Articles Posted in Medicare Fraud

j-300x198Steven 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.

1-1-300x198Upcoding In The ER Could Be Stealing U.S. Tax Dollars

It’s an old and shady practice that has been in the forefront of Medicare and Medicaid fraud for years. Upcoding can hit taxpayers hard and drive emergency room bills to the thousands.

What is Upcoding?

CHS-300x200A Revived Lawsuit Against Community Health Systems Is Moving Forward

The court system is reviving an $891 million securities fraud lawsuit against Community Health Systems. According to Modern Healthcare, the shareholder’s allegations of securities fraud deserve another look. A federal appeals court agrees the company may have intentionally inflated its financial outlook.

The Lawsuit

Memorial Hermann Endoscopy and Surgery Center physicians agreed to pay more than $1.5 million to settle Medicare fraud allegations. Gurunath Thota Reddy, MD, and other surgery center physicians allegedly performed colonoscopies for 7.5 years that Medicare deemed “essentially worthless.” United Surgical Partners International operates the center, while the physicians are part of Houston-based Digestive & Liver Disease Consultants PA. Houston-based Memorial Hermann Health System is a minority owner.

A former nurse claimed center physicians were spending as little as two minutes on a colonoscopy, while not examining the entire colon. The nurse also claimed Dr. Reddy allegedly reused surgical gowns to save money. The nurse was fired the day after she brought the issues to the attention of USPI’s regional vice president. The practice’s lawyer Gene Besen disputed the timing and reason behind her dismissal.

Mr. Besen said in a statement the practice settled, “to avoid the cost of defending allegations and to continue to serve the community with the highest quality of care and standards as they have done for the last three decades.” Mr. Besen said the physicians have repeatedly denied the allegations.

The Macon-based Medical Center of Central Georgia, the second largest hospital in the state, will pay $20 million to settle allegations that it violated the False Claims Act by billing Medicare for more expensive inpatient services instead of less costly outpatient or observation services.

The feds alleged that from 2004 to 2008 the hospital knowingly charged Medicare for medically unnecessary inpatient admissions when the care provided should have been billed as less costly outpatient or observation services.

Since January 2009, the U.S. Justice Department has recovered more than $24 billion through False Claims Act cases, with more than $15.3 billion of that from cases involving fraud against federal health care programs.

ManorCare, one of the nation’s largest healthcare providers with 281 skilled nursing facilities (SNF’s) in 30 states has been sued under the False Claims Act in a whistleblower action now joined by The Justice Department (DOJ). The DOJ intervened in a  consolidated complaint against HCR ManorCare alleging that ManorCare knowingly and routinely submitted false claims to Medicare and Tricare for rehabilitation therapy services that were not medically reasonable and necessary.

The Government says that ManorCare, owned by The Carlyle Group, exerted pressure on SNF administrators and rehabilitation therapists to meet unrealistic financial goals that resulted in the provision of medically unreasonable and unnecessary services to Medicare and Tricare patients.

ManorCare allegedly set prospective billing goals designed to significantly increase revenues without regard to patients’ actual clinical needs and threatened to terminate SNF managers and therapists if they did not administer the additional treatments necessary to qualify for the highest Medicare payments.

Federal prosecutors in Florida are pursuing an unusual criminal fraud case  taking aim at billing practices of Medicare Advantage plans, which are popular with seniors because out-of-pocket costs are lower and they provide more benefits than traditional Medicare.The case centers on a South Florida doctor affiliated with Humana Inc., one of the industry’s biggest players.

A federal grand jury in West Palm Beach, Fla., indicted the doctor, Isaac Kojo Anakwah Thompson, on eight counts of health care fraud on Feb. 4. He’s accused of cheating Medicare out of about $2.1 million by claiming his Humana-enrolled patients were sicker than they actually were. Thompson, 55, was arrested and is free on a $1 million bond. Through his lawyer, he declined comment.

The indictment does not accuse Humana of wrongdoing and the company has repaid the Government.

Cardinal Health Inc. said in a regulatory filing that it has been sued by the government for fraud and violating health care laws for its marking and sale of continence and ostomy products.  The complaint in the case was apparently filed against Cardinal Health at Home division last year in the U.S. District Court in Massachusetts.

The Department of Justice has not yet determined if it will intervene in the case and is conducting an investigation, according to Cardinal, which is providing information to DOJ .

Jeffrey Newman represents whistleblowers. He does not represent whistleblowers in this case.

The Department of Justice is investigating 21st Century Oncology Holdings Inc. on allegations that it knowing billed for services that were not medically necessary and for services not rendered, according to the Wall Street Journal. Subpoenas issued to the company relate to a radiation therapy which the company asserts is used only for medical reasons and not profits. Continue reading

Bostwick Laboratories, Inc., an anatomic and pathology lab based in Uniondale, New York, has agreed to pay the United States$6,048,000 to resolve allegations regarding violations of the False Claims Act.

The qui tam complaint was filed in May 2008. It alleges that Bostwick Laboratories improperly billed Medicare and Medicaid for tests and services referred in violation of the Anti-Kickback Statute and for tests performed without a doctor’s order or consent. The Justice Department decided in June 2011 not to intervene in the case. In 2012, Senior District Judge S. Arthur Spiegel issued a well- reasoned order denying the defendants’ motions to dismiss. U.S. ex rel. Daugherty v. Bostwick Laboratories, et al., 2012 U.S. Dist. LEXIS 178641 (S.D. Ohio Dec. 18, 2012).

The case against Bostwick Laboratories settled after the company entered into settlement discussions with Mr. Daugherty and the United States based on its inability to pay the full value of the damages sought in the qui tam action.