Taking Advantage of the Digital Switch: CFO Admits Lying to Receive Medicare’s Electronic Health Records Incentive Payments

Mention the phrase “card catalog” to someone over age 30 (or maybe 35?) and they will recall searching for books in the library by leafing through small notecards listing titles, authors, and Dewey Decimal numbers. Mention the phrase to a teen and you’ll probably elicit a blank stare. The card catalog is just one example of a formerly physical record system that has been replaced by electronic records. The shift to electronic records remains a work in progress in the health care field and incentives are being offered to encourage health care organizations to make the move to electronic health records. Sadly it comes as little surprise to the experts at our health care fraud law firm in Northern California that there are those looking to take advantage of the incentives and willing to defraud the government and the health care system for their own financial gain.

CFO Falsely Told Officials Hospital Made Meaningful Use of Electronic Records
A press release carried by KTRE, an ABC affiliate in Texas, announced that a former hospital CFO pled guilty last week to making false statements that officials say were part of a larger health care fraud scheme. While acting as CFO for Shelby Regional Medical Center, Joe White oversaw the hospital’s implementation of an electronic health records system. In this role, White made statements to Medicare attesting that the hospital made meaningful use of electronic records and qualified for certain payments pursuant to Medicare’s Electronic Health Record Incentive Program. According to White’s guilty plea, he knew the hospital did not qualify as a meaningful user at the time he made these statements on November 20, 2012. As a result of White’s false attestations, the Medical Center received $785,655 from Medicare.

White’s guilty plea comes amidst other fraud charges tied to the Shelby Regional Medical Center. As reported in The Dallas Morning News White’s former employer Dr. Tariq Mahmood was convicted back in July on 15 counts of fraud. Mahmood owned and operated a chain of hospitals, including Shelby Regional. A jury found that he directed hospital billing coders to alter diagnoses and assign codes for more serious diagnostic codes to Medicare claims than the patients’ medical charts reflected. The fraud involved over $1.1 million in federal Medicare claims. Four of the six hospitals in the chain have since closed and the remaining two are under new leadership but still struggling, allegedly due to Mahmood’s failed leadership.

The Danger of Complicity, The Importance of Whistleblowers
While the $785,655 payment made by Medicare as a result White’s fraudulent statements is a tiny fraction of the billions lost to Medicare fraud each year, every instance of medical fraud takes money from the already-strained health care system. Wrongdoing associated with electronic records is particularly concerning given the enormous implications for patient privacy. More broadly, those at the helm of large health care fraud schemes succeed because others lend their support. In some cases, this comes in the form of “little” frauds that add up to a larger scheme and “smaller” lies that lend support to the bigger plot. In other (and more frequent) cases, the fraud is supported by the silence of those who see the wrongdoing but are afraid or unwilling to speak up.

We understand it is hard to challenge company leadership and scary to go against the tide. This is where we come in. We work with whistleblowers, ensuring their interests are protected while building case and using the law to stop the fraud and recover wrongfully diverted funds. When a private individual successfully helps the government recover lost monies, the whistleblower is often eligible for a substantial reward in recognition of his/her efforts. Call to arrange a no-cost consultation with a whistleblowers’ Medicare fraud attorney in Santa Rosa, San Francisco, or Oakland.