Date Posted: Wednesday, December 04, 2024

 

The following cases highlight fraud, waste, and abuse (FWA) and serve as a reminder to uphold high ethical standards when providing patient care and services.

 

Testing Laboratory Co-Owner Sentenced for $3.8 Million in Fraudulent Billing

 

Mid-August saw the U.S. District Judge on the case sentencing a former St. Louis County healthcare company owner to 20 months in prison and fining him $100,000 for submitting more than $3.8 million in fraudulent claims to Medicare, Medicaid, and private healthcare benefit programs.

 

He owned or operated a series of healthcare-related businesses. His co-defendant, a doctor, owned Advanced Geriatric Management LLC (AGM) in Missouri. In the fall of 2014, the men decided to open an in-house testing lab at AGM. They also opened Genotec DX, which they held out as a clinical testing laboratory, and which was in the same building and used the same testing machine as AGM's lab.

 

The duo sought accreditation for both labs under the Clinical Laboratory Improvement Amendments (CLIA), which provides quality standards for laboratories. They did not disclose that both labs would employ the same part-time employee who would perform tests using the same machine. To convince CLIA to grant Genotec a final certificate of compliance in November 2015, the co-owner participated in causing Genotec to make misrepresentations to CLIA, including that Genotec's testing hours "changed so that they no longer overlapped with AGM. The misrepresentations also included claims that AGM stopped lab running samples and transferred its employees to Genotec in July of 2015, and that Genotec did not begin running samples until July of 2015. Actually, the AGM lab continued operating after July 2015 and Genotec started testing months before then.

 

The pair concealed the doctor's co-ownership of Genotec from Medicare, Medicaid, and private healthcare insurers, while referring urine specimens from the doctor's own practice, AGM, to Genotec.

 

The pair and other healthcare providers at AGM ordered urine toxicology tests for patients and referred those tests to AGM's lab and Genotec, which in turn sent the samples to outside "reference laboratories. Both men knew AGM and Genotec did not have the necessary testing equipment to confirm the amount of given toxin in the urine testing to a high degree of certainty, according to court documents. They then billed health insurers for the testing, despite knowing that Medicare, Medicaid, and many private insurers bar "pass-through billing, or billing for tests performed by others.

 

When health insurers became resistant to paying Genotec claims, the duo created another laboratory company in March of 2015, called Midwest Toxicology Group LLC ("Midwest), for the purpose of billing health insurers. Midwest was a lab in name only and was not authorized to perform tests on human specimens. The men never obtained a CLIA certification or any lab equipment for Midwest. In many instances, the co-owner caused Genotec and Midwest to each submit claims for the testing of the same specimen obtained from the same person on the same day of service. The pair also falsely used Genotec's CLIA number on claims submitted under Midwest's name.

 

The co-owner admitted in his plea agreement that Medicare, Medicaid, and private healthcare insurers paid $1.4 million in pass-through billing and $2.4 million in split billing.

 

The co-owner pleaded guilty in February in the U.S. District Court in St. Louis to a felony conspiracy charge.

 

The doctor pleaded guilty in November 2022 and has satisfied the restitution owed. He also agreed to forfeit $3.1 million in assets.

 

Source: Testing Laboratory Co-Owner Sentenced for $3.8 Million in Fraudulent Billing (2024, August 13). www.justice.gov.

 

Attorney General Charging Medicaid Biller for $1.2 Million in False Liquid Nutrition Claims

 

The Attorney General of Colorado filed fraud and theft charges against a woman in an alleged Medicaid fraud scheme that cost taxpayers over $1.2 million in losses. She is accused of submitting false claims to the state of $1,217,933 when she worked as a Medicaid biller for Element Medical Supply, a durable medical equipment company.

 

An investigation by the Medicaid Fraud Control Unit in the Colorado Department of Law found that from May 2020 to March 2021, the woman allegedly submitted false claims for enteral formula, a liquid nutrition product used to feed patients who are unable to consume enough food orally. While she billed millions of calories of formula, only about 5% of the product billed to Medicaid was delivered to patients. Investigators were able to link a username and IP addresses used to submit the claims in question to her location and identity.

 

The Attorney General said, "Not only does taking advantage of the state's Medicaid system harm all of us as taxpayers, it harms the entire healthcare system by threatening to erode trust in providers. He continued, "We will not hesitate to investigate and prosecute those who exploit Medicaid and the patients the system serves.

 

She is charged with Medicaid fraud and waste false claims of $1 million or more and cybercrime theft of $1 million or more, both class two felonies.

 

The filing of criminal charges is a formal accusation that an individual committed a crime under Colorado law. All defendants are presumed innocent until proven guilty.

 

The Colorado Medicaid Fraud Control Unit receives 75% of its funding from the U.S. Department of Health and Human Services under a grant award totaling $3,795,665 for federal fiscal year 2024. The remaining 25%, totaling $1,265,221, is funded by the state of Colorado for the federal fiscal year.

 

Coloradans who are aware of or suspect Medicaid fraud are encouraged to file a complaint with the attorney general at StopFraudColorado.gov.

 

Source: Attorney General Charging Medicaid Biller for $1.2 Million in False Liquid Nutrition Claims (2024, August 14). www.coag.gov.

 

U.S. Attorney Announcing $600,000 False Claims Act Settlement With Medical Practice and Its Owners for Improper Medicare and Medicaid Billing

 

Orange Medical Care admits submitting claims for payment where services were rendered by nurse practitioners or physician assistants not enrolled with Medicare and Medicaid and doctors had no personal involvement or supervision in treatment.

 

The United States Attorney for the Southern District of New York, and the Special Agent in Charge of the New York Regional Office of the Department of Health and Human Services, Office of Inspector General (HHS-OIG), announced that the United States had filed and simultaneously settled a civil fraud lawsuit against Orange Medical Care, P.C. ("Orange Medical) and its owners, Ashikkumar A. Raval and Manish A. Raval (together, the "Ravals, and with Orange Medical, the "defendants).

 

The owners are both Ravals, physicians, who own and operate Orange Medical, a family medicine practice that provides primary care services to patients in New York. The settlement resolves claims that Orange Medical and the physicians fraudulently billed Medicare and Medicaid by submitting claims for primary care services that were not rendered or supervised by the physician identified in the claim for payment and had, in fact, been rendered by non-credentialed providers.

 

Under the approved settlement Saturday, August 17, 2024, by the U.S. District Judge on the case, Orange Medical and the Ravals will pay $268,800 to the U.S. and have admitted and accepted responsibility for conduct alleged in the Complaint as further described. Orange Medical and the Ravals have also agreed to pay $331,200 to the State of New York to resolve the State of New York's claims, for a total recovery of $600,000. The settlement amount is based on the Office's and the State of New York's assessment of Orange Medical's and the Ravals' ability to pay based on the financial information they provided. The parties have also executed a Consent Judgment in the amount of $1,646,835, which may be enforced if the defendants do not make the payments required under the settlement agreement.

 

As alleged in the Complaint filed in a Manhattan federal court:

 

From November 2006 through December 2022, Orange Medical and the Ravals submitted claims to Medicare and Medicaid that listed one of the Ravals as the rendering provider even though the services had been rendered by non-credentialed providers, without the direct supervision of either of the Ravals. On many such occasions, the Ravals were traveling outside of the U.S. at the time the patient received the treatment.

 

As part of the settlement, Orange Medical and the Ravals admitted and accepted responsibility for certain conduct alleged by the U.S., including the following:

 

Orange Medical and the Ravals understood that they were prohibited by relevant federal healthcare program rules from submitting claims for reimbursement to Medicaid in the State of New York for primary care services if the physician listed as the rendering provider on the claim for reimbursement had not actually rendered the services and, with respect to Medicare, if the services were not, at minimum, rendered "incident to medical services actually provided by the physician listed on the claim. Orange Medical and the Ravals further understood that, in order to receive reimbursement from Medicaid, a healthcare provider must be enrolled as a provider in the Medicare or Medicaid program at the time the services are rendered.

 

Nonetheless, Orange Medical and the Ravals frequently submitted claims to Medicaid and Medicare for primary care services that listed either doctor, Manish Raval or Ashikkumar Raval as the rendering provider, even though they had not rendered the services for which reimbursement had been sought. In fact, the services had been performed by providers who had not enrolled in the Medicare or Medicaid programs. Further, the providers that had rendered the services were often not physicians, but instead nurse practitioners or physician assistants. On many such occasions, the Ravals had no personal involvement or supervision in the treatment of the patient and were traveling outside of the U.S. at the time that the services were furnished.

 

Orange Medical and the Ravals also altered patient records to reflect falsely that one of them had seen a patient when, in fact, the patient had been seen by a different provider.

As a result of the conduct described above, Orange Medical received reimbursements from Medicare and Medicaid for primary care claims that did not comply with those programs' billing rules.

 

In connection with the filing of the lawsuit and settlement, the government joined a private whistleblower lawsuit that had been filed under seal pursuant to the False Claims Act.

 

Source: U.S. Attorney Announcing $600,000 False Claims Act Settlement With Medical Practice and Its Owners for Improper Medicare and Medicaid Billing (2024, August 19). www.justice.gov .

 

Provider to Pay $600,000 to Resolve False Claims Act Liability Arising From Billing of Electro-Acupuncture Device

 

Two U.S. Attorneys of Pennsylvania and Delaware announced that PA Green Wellness ("PA Green), a business located within PA and DE, agreed to pay $600,000 to resolve liability under the False Claims Act for the alleged improper billing of an electro-acupuncture device.

 

From September 2020 through July 2021, PA Green billed Medicare for the application of a percutaneous electrical nerve pulse stimulation device (the "P-Stim Device) in an office setting.

 

The P-Stim Device is a device for treatment of chronic pain that, pursuant to manufacturer's instructions, is affixed behind a patient's ear using an adhesive. Needles are inserted into the patient's ear and affixed using another adhesive. Once activated, the device then provides intermittent stimulation by electrical pulses. It is a single-use, battery-powered device designed to be worn for several days until its battery runs out, at which time the device is thrown away. Other brand names for this device include Stivax, NeuroStim, ANSiStim, E-Pulse, and NSS-2 Bridge.

 

PA Green applied the P-Stim Device simply using an adhesive and insertion of a limited number of needles. The procedure did not involve any surgery or anesthesia or take place in an operating room (or even at a facility with such capabilities) but was billed to Medicare as a surgically implanted neurostimulator, contrary to repeated guidance from the Centers for Medicare and Medicaid Services (CMS).

 

On June 22, 2021, SafeGuard Services LLC, the Northeastern Unified Program Integrity Contractor of Medicare (UPIC), provided notice to PA Green Wellness that CMS had suspended $50,845.99 of Medicare payments to PA Green Wellness pursuant to 42 C.F.R. § 405.371(a)(2) based on credible allegations of fraud. As part of the settlement, PA Green has agreed that the United States will retain the suspended payments.

 

The Pennsylvania U.S. Attorney on the case stated, "Along with other U.S. Attorneys around the country, CMS, and the Department of Health and Human Services Office of Inspector General, we have held distributors and providers accountable for inappropriate acupuncture device billing. It may not be billed as surgically implanted neurostimulators.

 

In addition, the Delaware U.S. Attorney stated, "The decisions made by CMS about what procedures are reimbursable and how they may be billed are designed to ensure that all beneficiaries receive safe and effective treatment at an appropriate cost.

 

Source: Provider to Pay $600,000 to Resolve False Claims Act Liability Arising From Billing of Electro-Acupuncture Device (2024, August 19). www.justice.gov.

 

Sonal Patel, BA, CPMA, CPC, CMC, ICDCM, is CEO and Principal Strategist at SP Collaborative, LLC.

 

Home - SP Collaborative