Federal prosecutors say CityMD, a New York based urgent care, admitted that it overcharged Medicare. They will pay millions for ordering more expensive procedures, and billing for services provided by physicians who were not properly credentialed.
The Whistleblower Lawsuit
The federal government joined a private whistleblower lawsuit. The lawsuit had been filed under seal but made severe allegations that CityMD has now admitted to committing.
A physician has been indicted for stealing nearly $1 million in Medicare fraud scheme that also included private insurance. Dr. Pranav Patel, of the Chicago area, allegedly submitted fake insurance claims for medical tests and exams that were never conducted.
SightLine Health LLC (SightLine), which operates radiation therapy centers throughout the United States, will pay $11.5 million to settle a False Claims Act lawsuit alleging that it knowingly submitted claims to the Medicare program that violated the Anti‑Kickback Statute. Together with Integrated Oncology Network Holdings LLC (ION), which acquired SightLine in 2011, SightLine has agreed to pay the government up to $11.5 million. The Anti-Kickback Statute is intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and instead is based on the best interests of the patient. It prohibits anyone from offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded programs. Claims submitted in violation of the Anti-Kickback Statute may subject the claimant to liability under the False Claims Act.
The settlement resolves allegations that SightLine violated the Anti-Kickback Statute and the False Claims Act by targeting physicians that were able to refer patients to its cancer treatment centers, and paid those physicians a share of its profits pursuant to investment arrangements that were set up to allow physicians to profit from their referrals. Specifically, the United States alleged that SightLine formed a series of leasing companies in which referring physicians were permitted to invest, and through which SightLine allegedly distributed the profits that its physician-investors generated by referring cancer patients for radiation therapy.The allegations resolved by the settlement were brought in a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act. The whistleblower was represented by the firm Morgan Verkamp. The act permits private parties to sue on behalf of the government when they believe that defendants submitted false claims for government funds and to share in any recovery. The act also allows the Government to take over the case, as it did here in part. The whistleblower will receive up to $1.725 million. “Investment arrangements that are structured to improperly compensate physicians for referrals can encourage physicians to make decisions based on financial gain rather than the best interest of their patients,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “The Department of Justice is committed to preventing illegal inducements, in whatever form, that undermine the integrity of our public health programs.”
“As the professionals charged with recommending and referring medical procedures for our community, physicians’ primary motivation must remain the well-being of their patients,” said U.S. Attorney Erin Nealy Cox. “Today’s settlement demonstrates our determination to eliminate complex business ventures that improperly interpose financial considerations into our physicians’ medical judgment.” In addition to resolving their alleged False Claims Act liability, ION, SightLine, and their related entities have entered into a five-year Corporate Integrity Agreement with the HHS-OIG. This agreement is intended to increase accountability and transparency and to deter future misconduct. The Corporate Integrity Agreement includes internal and external monitoring of the relationships between the ION and SightLine entities and referring physician investors.
According to GoEarie, Tullio Emanuele, M.D., claimed Hamot and the other defendant, Medicor Associates Inc., knowingly submitted claims to the Medicare and Medicaid programs that violated the Anti‑Kickback Statute and the Physician Self-Referral Law (the “Stark Law”).
Emanuele practiced with Medicor from 2001 to 2005. He contended that Hamot violated federal law between 2004 and 2010 by submitting claims, primarily to Medicare, while the hospital was paying millions of dollars a year to Medicor, an independent physician-owned group that remains in business.
This week the Justice Department made a big move that could be a game changer for the nation’s opioid crisis. According to Cleveland.com, the DOJ will make a large swath of data on painkillers available, hoping the intel will be used in the fight against big pharma.
The DOJ has made its position clear when it comes to chasing after the legal makers and distributors of these drugs. Attorney General Jeff Sessions even went so far to create an Opioid Fraud Unit in order to target 12 federal districts the DOJ believes have been hardest hit by the opioid epidemic. The Opioid Fraud Unit uses data to find and target doctors or clinics they suspect are overprescribing opioids. They also want to go after pharmacists who are not properly distributing the pills. But with the release of this new data, they are hoping to help with settlement talks between the drug companies and the local governments suing them over the nation’s opioid epidemic.
VA physician Dr. Sarah Kemble, Chief of Medicine for the U.S. Department of Veterans Affairs for the central and western Massachusetts region revealed on her deathbed that the medical care for veterans at the Northampton Medical Center is substandard, especially regarding psychiatric care. Dr. Kemble wrote a 23-page affidavit revealing the inside information give days before she died of cancer in December. The VA’s Office of Accountability and Whistleblower Protection has is now investigating.
The Northampton Medical Center advertises itself as a 24-7 urgent care hospital but, according to the affidavit, this is not true and in addition, there are no lab service, radiology, clinical pharmacist or appropriate psychiatric service available during nights or weekends.
Steven M. Butcher, 39, owner of MedMax LLC, which provided marketing services for compounded medications, pleaded guilty before U.S. District Judge John Michael Vazquez in Newark federal Court for conspiracy to commit healthcare fraud and violate the Anti-Kickback Statute.
Butcher used his company, MedMax, to convince people to obtain unneeded compound medications and then bill the costs to various private and federal healthcare insurance plans. MedMax was a marketing company for compound medications. Butcher also paid several kickbacks from 2014 to 2015 for many individuals to fraudulently bill a health care benefit program that primarily serviced military families, called TRICARE, for unnecessary compound medications.
Compounded pharmacies prepare personalized medications based on specific prescriptions that include instructions for exact strength and dosage.
Hearing the term Medicaid fraud may conjure up images of lawyers and government officials, but the true cost is actually much closer to home for many people. Fraud and abuse in Medicaid cost taxpayers billions of dollars every year. Funds intended to help the sick end up being wasted.
But worse than the wasted time is the risk to patients caught up in unnecessary procedures that just line the pockets of unscrupulous health care companies. Imagine if you found out that your child had an unnecessary surgery just so that agency could make a few hundred dollars.