Articles Posted in Whistleblowers and Qui Tam Lawsuits

One of the most disturbing forms of health care fraud is fraud involving nursing home residents, a group that relies on their caregivers even more than most members of the public. As a San Francisco nursing home fraud lawyer, with expertise in both Medicare fraud and nursing home abuse matters, Attorney Brod works with the brave whistleblower who come forward to report nursing home fraud. Using the qui tam provisions of fraud laws, we work as a team to stop these transgressions, help the health care programs recoup losses and bring perpetrators to justice. We also protect whistleblowers from retaliation and ensure they receive due compensation for their role in stopping the health care fraud epidemic.

Nursing Home Chain Allegedly Committed Medicare Fraud

Life Care Centers of America Inc. (“Life Care”), a nursing home care company based in Tennessee, is facing allegations it engaged in Medicare fraud, filing millions of dollars of claims for unnecessary treatments. A Wall Street Journal report from late 2012, reviewed allegations that Life Care, from high-ranking executives to low-level supervisors, pressured therapists to provide unneeded, expensive treatments and bill ever-higher amounts. According to the Complaint, Life Care billed both Medicare and Tricare, an insurance program for military personnel and their families, for unnecessary treatments in a scheme dating back to at least 2006. Life Care allegedly falsified records in order to charge the government for the most costly services possible.

Our firm serves personal injury clients. We are also a law firm for California health care fraud whistleblowers, teaming with brave individuals/groups to combat fraud. Why the overlap? In a press release announcing the settlement of pharmaceutical kickback claims, Assistant Attorney General Stuart F. Delery explains that “Americans who rely on federal health care programs, particularly vulnerable patients in skilled nursing facilities, are entitled to feel confident that decisions about their medical care are not tainted by improper financial arrangements.” Such tainted decisions can cause serious harm to patient health and even death. Combatting health care fraud and representing the injured serve similar goals, making the practices a natural fit.

Omnicare, Take One: Receiving Kickbacks from a Drug Manufacturer

The Department of Justice (“DOJ”) published the press release referenced above in February 2014. It announced a settlement with Omnicare Inc., the nation’s largest company supplying pharmaceuticals and related services to nursing homes and long-term care facilities. Omnicare agreed to pay the government $4.19 million to settle claims Omnicare solicited and received kickbacks from Amgen Inc., a drug manufacturer, for participating in “therapeutic interchange programs” aimed at switching Medicaid beneficiaries from another drug to one of Amgen’s products. Kickbacks included rebates, grants, data and speaker fees, consulting services, as well as dining and travel.

Over the last week, two major cases concerning Medicare fraud that resulted in a guilty plea for an office worker or a prison sentence and fines for a well-known physician made the news. The two decisions represent text-book cases of why San Francisco qui tam lawsuit lawyer Gregory J. Brod would point out that the South Florida area has become a hotbed for healthcare fraud schemes in the United States.

The sentencing and fines handed down on Friday, June 13, probably gained more attention of the two cases, because the target was Christopher Gregory Wayne, a Miami Beach, Fla., osteopathic physician popularly known as the “Rock Doc,” so named by his patients because he favored wearing his blond hair in distinctive spikes. According to the Miami Herald, Wayne’s hair was not the only thing he was spiking, as he was convicted of running up millions in fraudulent charges against Medicare.

Wayne, who pleaded guilty in February to the charges leveled against him, admitted to a brazen scheme to billing Medicare for physical therapy services that he knew were never provided to patients at his Miami medical office. But in admitting to the violations, Wayne excused his behavior by claiming that he was unaware of a 2008 policy change that required his employees to be licensed physical therapists in order to conduct such services. Wayne’s plea agreement detailed fraudulent billing against Medicare that amounted to more than $5 million for thousands of ultrasounds, massages and other forms of physical therapy that were not provided or needed between December 2007 and August 2009.

Among the blatant schemes detailed in the plea deal was one where Wayne billed Medicare for services that were purportedly provided to a patient while she was out of the country; in many other examples of fraud, Wayne’s unlicensed employees provided services instead of him. As a result of all of Wayne’s schemes, Medicare paid his clinic, Miami Urgent Care and Rehab Center, about $1.9 million.

But Wayne did not stop at schemes emanating from his clinic, as prosecutors said that he was caught selling significant amounts of the painkillers Oxycodone and Endocet to a confidential law enforcement source and an undercover police officer on three occasions in 2011. According to the prosecutors, Wayne pocketed $428,000 from the sale of “drug cocktails” to patients regardless of medical necessity.

A federal judge sentenced Wayne to nearly six years in prison and ordered him to return $1.65 million for his theft of millions from Medicare.

On Thursday, a Miami office worker pleaded guilty to a scheme that involved a defunct home healthcare company, according to the Federal Bureau of Investigation‘s Miami Division. Lizette Garcia will be sentenced in August after admitting to a district judge in the Southern District of Florida to one count of payment of healthcare kickbacks.

Court documents revealed that Anna Nursing, the home healthcare agency, billed Medicare for, among other things, expensive physical therapy and home healthcare services that were medically unnecessary and/or were never provided. Garcia was charged with paying kickbacks and bribes to patient recruiters in return for the recruiters providing patients to Anna Nursing so that Medicare could be billed for the fraudulent services. From October 2010 through approximately April 2013, Medicare shelled out nearly $7 million to Anna Nursing for medically unnecessary or not-provided home healthcare services.
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Good doctors should be paid well. Good doctors make huge sacrifices, racking up huge schooling bills and sacrificing sleep and personal time to serve their patients. This, along with the desire to attract talented minds to medical practice, makes paying doctors well incredibly important. However, when a doctor’s pay, including Medicare and Medicaid reimbursements, is way out of line with his/her colleagues, it raises a red flag. High billings can be one sign of health care billing fraud. It is one of many pieces of evidence that our California medical billing fraud law firm in San Francisco uses to evaluate and build a qui tam (aka whistleblower-brought) case against providers who commit health care fraud.

Doctor Charged With Medicare Fraud

A San Francisco Chronicle report published last week focused on the indictment of Dr. Robert A. Glazer on a charge of conspiracy to commit health care fraud, a charge involving allegations that he defrauded Medicare, filing $33.5 million worth of phony claims. Prosecutors allege that between January 2006 and May 2014, the Hollywood, California-based doctor billed the agency for services that were not medically necessary and sometimes hadn’t even been performed. They also suggest Glazer received kickbacks tied to phony hospice, wheelchair, and other medical supply prescriptions. One witness said she was offered everything from shoes to oil to rice and beans in exchange for coming to the clinic and that the clinic wouldn’t let her leave until she agreed to a sonogram. Further, Glazer ordered more than 1,000 power wheelchairs in the timeframe in contrast with other providers, even those focused on senior care, who may prescribe one or two a year.

If you are a regular reader of this blog, you are well aware that Medicare fraud is a serious problem that costs our nation billions of dollars each year. Understanding health care fraud and the many forms it can take is essential to fighting it, especially since private whistleblowers often alert the government to cases of fraud and even help pursue wrongdoers through lawsuits called qui tam actions. In this post, our California fraudulent health care billing lawyer discusses one of the most prevalent types of fraud – upcoding. While even a one-time choice to charge Medicare for a more expensive service than that provided is fraud, upcoding becomes an even greater threat when it is a matter of routine and a practice encouraged by a company looking to put profit above patient care.

A Basic Overview of Upcoding

The Patient Empowerment section of the About.com website provides a brief, patient-oriented discussion of upcoding. As the article explains, medical providers use numbers called CPT codes (“current procedural terminology”) to bill insurance providers, including Medicare and Medicaid, for each service they provide to a patient. Each CPT codes is tied to a service and the amount that the provider will be paid for performing it. Upcoding is the practice of using a CPT code that commands a greater payment than the proper code would elicit. For example, a doctor may have performed a quick check up but bill using the code for an expanded check up, resulting in a higher payment from Medicare than is actually appropriate. Upcoding is fraudulent and illegal, costing the taxpayers money and also endangering the health of individual patients by building a false medical record.

Fraud is a crime that hits people in their pocketbooks and can also feel like a betrayal of trust. Health care fraud fits both these characterizations but also includes an added danger — it is often a direct threat to our physical and mental well-being, endangering people’s health and even jeopardizing lives. Money should not cloud decisions about what treatments are appropriate and medically necessary. This is why the problem of kickbacks to patient recruiters is of great concern. The danger posed to people’s health and well-being, in addition to the economic threat, also motivates our California health care fraud law firm in our work to stop all forms of improper payments for medical referrals.

FBI Announces Sentencing of Patient Recruiter in Kickback Scheme

This month, the Federal Bureau of Investigation (“FBI”) issued a press release announcing a criminal sentence for Richard Shannon, age 41, a patient recruiter who took part in a Medicare fraud scheme. At trial, evidence showed that Shannon solicited Medicare beneficiaries in the Detroit area to sign blank forms for physical therapy treatments that were not medically necessary and were never actually provided. The beneficiaries were typically destitute individuals that Shannon found in housing projects and Detroit-area soup kitchens. In exchange for their patient information and signatures, Shannon provided cash and the promise of narcotics prescribed by physicians who were also involved in the conspiracy. Shannon’s co-conspirators, including the owners of All American and Patient Choice, two home health care companies based in Oak Park, then paid doctors to issue referrals and related documents necessary to bill Medicare for the same fake services.

In the wake of the week in which the federal government arrested 90 healthcare professionals accused of fraudulent acts against Medicare, it would be useful to review the key pieces of legislation, the so-called Anti-Kickback Statute and the Stark Law, that often undergird the government’s actions in sweeps such as these. In addition to reviewing these laws, San Francisco qui tam lawsuit attorney Gregory J. Brod would like to revisit the federal False Claims Act, which is the legal basis of support for action by a whistleblower on behalf of the government in cases where fraud has occurred.

A kickback, of course, is basically negotiated bribery in which some form of a commission, usually money, is paid to the person who takes the bribe in return for services he or she performs for the person who offers the bribe. In such a quid pro quo arrangement, the person taking the bribe and the person offering it are in collusion.

Kickbacks are a pervasive factor in government corruption involving public officials, but they are also a troubling incentive for fraud to be committed against the government by private individuals and entities, for example, in schemes that are cooked up to steal money from Medicare. The problem of medical companies paying doctors to refer patients to them for treatment, tests or other healthcare, whether the patient needs the care or not, has been a growing phenomenon in the United States. In 1972, Congress passed major legislation to discourage this sort of behavior in the form of the Anti-Kickback Statute, 42 U.S.C. Secs. 1320a-7b(b), which forbids anyone from offering, paying, soliciting or accepting anything of value in order to encourage or reward referrals or generate federal healthcare program business.

In 2011, Congress went an important step further in its quest to combat Medicare fraud when it passed the Stark Law. The Stark Law, 42 U.S.C. Sec. 1395nn, was named after its sponsor, former U.S. Rep. Pete Stark of California, and it is a limitation on certain types of physician referrals. Specifically, the Stark Law forbids a doctor from referring Medicare patients for designated healthcare to an entity in which that doctor or an immediate family member has a financial stake; the law also prohibits such designated healthcare entities from submitting claims to Medicare for services that have occurred as result of the prohibited referral.

While the Anti-Kickback Statute and the Stark Law are relatively new pieces of legislation, the main weapon in the federal government’s arsenal for combatting fraud, the False Claims Act, is much older, having been on the books since 1863. The False Claims Act, 31 U.S.C. Secs. 3729-3733, also known as the Lincoln Law, assigns liability to individuals and companies that knowingly defraud government programs.

The important “qui tam” provision of the False Claims Act permits individuals who are not affiliated with the government but have knowledge of fraud committed against programs such as Medicare to file a lawsuit on behalf of the government, with the person initiating the action known as a whistleblower. Such qui tam lawsuits account for a large majority of all legal action under the False Claims Act, and the whistleblowers who initiate them stand to receive 15 percent to 25 percent of any recovered damages.
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