Healthcare Fraud Lawyer Blog

At the Brod Firm, we do the work we do for many reasons. We enjoy the intellectual challenge and being able to constantly grow, using what we learned yesterday to improve our work today. We enjoy serving our clients and helping them through their legal challenges, difficulties that often arise during life challenges. From an injured pedestrian to a grieving parent, a wronged tenant to a patient whose well-being was sacrificed for someone else’s financial reward, we enjoy making a difference. In the particular case of our work as a California health care fraud law firm, we enjoy partnering with inspiring whistleblowers in anti-kickback and other matters to fight for our health care programs and for patients’ rights. We are honored to play this role.

Kickback Case Involving Prenatal and Infant Care

Last week, an FBI press release announced the guilty pleas of Tracey Cota and Gary Lang. Both pled guilty to conspiring to violate the Anti-Kickback Statute by referring patients to hospitals in exchange for illegal payments. Lang served as the CEO of a hospital that was a provider enrolled in the Georgia Medicaid program while Cota owned and acted as COO for a corporation that operated multiple medical clinics in the Atlanta region and on Hilton Head Island.

Imagine starting a new job. You’ve probably left behind another job and made other changes to prepare for the new experience, perhaps even relocating. No matter how experienced and educated you are, it is a nerve-wracking experience. It takes time to learn company practice. Now suppose you are asked to do something you know is wrong. What would you do? In the case of health care fraud and other forms of government contracting fraud our Northern California whistleblowers’ law firm helps people who find themselves in this situation, helping them report the wrongdoing while protecting their own interests.

False Claims Allegations Brought Thanks to Whistleblower and Supported by Another Inside Witness

Last week, an FBI press release detailed federal health care fraud charges filed against Jocelyn Gumila, a nurse who served as the manager for Doctor At Home (“DaH”). The release details allegations including double-billing, over-billing, and improperly certifying patients as eligible for home-based care. Doctor At Home allegedly helped home health agencies pursue false billings such as claims for more than $1,000 per month to provide nurse visits that were not medically necessary.

Suppose your eight year-old child receives a weekly allowance of $5 (perhaps the amount dates us!) and instead of handing him a five dollar bill, you accidentally give him a $20. If he speaks up, you probably praise his honesty, but what if he doesn’t? How do you feel later when you notice your own error? The moment might prompt a lesson in honesty and a discussion of how silence can be dishonest. With your child, there might be room for debate, but what if the recipient is a medical institution and the money closer to a million dollars than five? That scenario might trigger a concept known as reverse false claims, a violation of the False Claims Act that may be costing the government billions a year. As a Northern California medical fraud lawyer, Attorney Gregory Brod is dedicated to working with whistleblowers to end all forms of costly frauds from purposefully filing claims for services that were never provided to knowingly accepting and keeping overpayments.

“Reverse False Claims” and the False Claims Act

The U.S. Justice Department provides a primer to explain key parts of the False Claims Act (“FCA” or “the Act”) and how the law works. As we’ve discussed in prior posts, the Act creates liability for submitting or causing another to submit false claims to the federal government. Medical fraud is one of the key areas in which the Act is invoked and cases are often brought under the “qui tam” provisions that allow a private whistleblower to bring a claim on the government’s behalf. The Primer also notes that Section 3729(a)(1)(G) creates liability for reverse false claims. Initially, this provision was pretty narrow but revisions to the Act in 2009 and 2010 made it clear that Congress intends this reverse false claims concept to create liability when a facility receives an overpayment for services and, despite being aware of the overpayment, fails to return the money within a 60-day period.

It seems as though every time the federal government gains ground in the battle over Medicare fraud, schemers come up with new scams or variations of old ones in an attempt to stay one step ahead of the feds. So it comes as little surprise to San Francisco qui tam lawsuit attorney Gregory J. Brod that testing conducted at clinical laboratories could provide another frontier for healthcare fraud.

According to the Wall Street Journal, a report from the Department of Health and Human Services’ Office of Inspector General released Wednesday called into question $1.7 billion in approved Medicare payments to clinical laboratories in 2010 alone. The report found that more than 1,000 labs had five or more measures of questionable billing in that year. The six measures, median levels and the questionable lines these labs crossed that have raised red flags include the following:

• Lab average allowed amount per ordering physician: median, $61; threshold for questionable, $901
• Lab average claims per ordering physician: median, 3; threshold for questionable, 22
• Lab average allowed per claim: median, $19; threshold for questionable, $129
• Claims with beneficiaries living 150 miles or more away from ordering physician: median, 1.5 percent; threshold for questionable, 12.5 percent
• Lab average allowed amount per beneficiary: median, $47; threshold for questionable, $303
• Lab average claims per beneficiary: median, two; threshold for questionable, nine

In addition to the red flags the 1,000 labs have raised, the very nature of the relationship between clinical laboratories and physicians in general is cause for concern, according to Medicare fraud specialists. The specialists harbor a more general suspicion of inappropriate spending at clinical laboratories, whose services include blood counts, cholesterol screenings and urinalysis, because doctors order their services from the labs rather providing them directly, and whenever a chain of healthcare providers are involved the prospect for fraud rises.

Not surprisingly, Medicare is the biggest payer of clinical laboratory services in the United States; the program paid out $8.2 billion in 2010 for lab services as part of its Part B benefit, which covers doctor visits as well as clinician services. And while enrollment in Part B has been increasing, going up by 10 percent from 2005 to 2010, the surge in spending for lab services through the program has been even more robust, going up by 29 percent during the same period.

While only 13 percent of all clinical laboratories in the nation are located in California and Florida, 43 percent of the labs that surpassed the threshold for having five or more measures of questionable billing were in either the Golden State or the Sunshine State. Indeed, Florida has been the epicenter of much of the nation’s healthcare fraud schemes.

Interestingly enough, the same day the inspector general’s report was released, the U.S. Senate Special Committee on Aging issued another eyebrow-raising report on Medicare fraud. According to CNBC, the Senate committee found that improper Medicare payments increased from $30 billion to $36 billion between 2011 and 2012. At about the same time, government officials began using a technology screening system that is similar to the one credit card companies employ to scan charges and freeze accounts.
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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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