8 Miami-Area Residents Charged, Assets Frozen in $22 Million Home Health Medicare Fraud Scheme

June 29, 2009

Eight Miami-Dade County, Florida residents have been indicted in connection with an alleged $22 million Medicare fraud scheme operated out of Miami businesses purporting to specialize in home health care services and the assets of those charged and their companies frozen as part of a joint Department of Justice (DOJ) and Department of Health & Human Services (HHS) Medicare Fraud Strike Force operation.

DOJ and HHS officials jointly announced the Florida indictments and injunction action on June 26, 2009, just two days after their June 24, 2009 joint announcement of that a Detroit Medicare Fraud Strike Force had secured indictments against 53 people for schemes to submit more than $50 million in false Medicare claims.

Both the Florida and Detroit actions arose from health care fraud conducted by Medicare Fraud Strike Force teams acting as part of a recently formalized and expanded Health Care Fraud Prevention & Enforcement Action Team (HEAT) jointly announced by the DOJ and HHS on May 20, 2009.  The Florida and Detroit actions announced last week reflect the growing commitment of federal officials to investigate and prosecute Medicare and other alleged heath care fraud.

8 Florida Indictments

The Florida indictments announced June 26, 2009 charge Gladys Zambrana, Javier Zambrana, Enrique Perez, Alejandro Hernandez Quiros aka Alex Hernandez, Vanessa Estrada, Vicenta Tellechea, Modesto Hidalgo and Carlos Castaneda conspiracy to commit health care fraud.  Gladys Zambrana was also charged with four counts of health care fraud.  Gladys Zambrana and Hernandez Quiros were charged with three counts each of paying health care kickbacks, while Perez, Hidalgo and Tellechea were charged with one count each of paying health care kickbacks.  Gladys Zambrana, Perez, Alejandro Quiros, Tellechea and Castaneda were also charged with conspiracy to launder health care fraud proceeds.

According to the indictment, Gladys Zambrana, Perez and Hernandez Quiros operated ABC Home Health Care Inc. (ABC), listing Javier Zambrana as the owner; and Gladys Zambrana and Castaneda operated Florida Home Health Care Providers Inc. (Florida Home Health), listing Tellechea as the owner.  Both ABC and Florida Home Health purported to be home health agencies that catered to Medicare beneficiaries.  The indictment alleges that at both agencies, beneficiaries were recruited and paid kickbacks and bribes to arrange for their Medicare beneficiary numbers to be used by their co-conspirators to file claims with Medicare for purported home health care services.  The indictment alleges that the services were not provided and were not medically necessary.

The indictment alleges that in addition to exerting ownership and control of the home health agencies, Hernandez Quiros and Castaneda acted as Medicare beneficiary recruiters for ABC and Florida Home Health, respectively; and Hidalgo, a medical assistant, falsified medical tests and records to make it appear that the services were needed.  The indictment alleges that ABC billed more than $17 million to the Medicare program for services provided from January 2006 through December 2008 that were medically unnecessary and were not actually provided.  During that time frame, Medicare paid more than $11 million on those fraudulent claims submitted by ABC.  The indictment also alleges that from October 2007 through March 2009, Florida Home Health billed more than $5 million to the Medicare program for services that were medically unnecessary and not actually provided.  During that time frame, Medicare paid more than $4 million on those fraudulent claims submitted by Florida Home Health.

The charge of conspiracy to commit health care fraud carries a maximum prison sentence of 10 years.  Each charged count of health care fraud carries a maximum prison sentence of 10 years and each count of paying health care kickbacks carries a maximum prison sentence of five years.  Conspiracy to launder health care fraud proceeds carries a maximum prison sentence of 10 years per count.

In conjunction with the criminal case, on June 24, 2009, the U.S. Attorney’s Office filed a civil complaint for injunctive relief under the fraud injunction statute and obtained a temporary restraining order freezing the assets of ABC, Florida Home Health, Gladys Zambrana, Javier Zambrana, Perez, Hernandez Quiros, Castaneda and Tellechea.  In addition, that temporary restraining order also freezes certain financial assets of four other companies the defendants owned or controlled and allegedly used to launder money fraudulently obtained from Medicare.  The temporary restraining order is intended to preserve the remaining proceeds of the fraud for recovery by the United States as part of the criminal case and any related civil proceedings.

53 Indicted In Detroit June 24

The announcement of the Florida indictment comes just 2 days after DOJ, HHS and FBI officials announced that a Detroit Medicare Fraud Strike Force had secured indictments against 53 people for their involvement in alleged schemes to submit false Medicare claims.  The indictments unsealed June 24, 2009 returned by a grand jury in Detroit resulted in arrests in Miami, New York City and Detroit resulted from a concentrated effort by the Detroit Medicare Fraud Strike Force targeting infusion therapy and physical/occupational therapy providers involved in schemes orchestrated to defraud the Medicare program.

Collectively, the Detroit indictment accuses the physicians, medical assistants, patients, company owners and executives charged in the indictments of conspiring to submit more than $50 million in false claims to the Medicare program.  According to the indictments, the defendants participated in schemes to submit claims to Medicare for treatments that were in fact medically unnecessary and oftentimes, never provided.  In many cases, indictments also allege that beneficiaries accepted cash kickbacks in return for allowing providers to submit forms saying they had received the unnecessary and not provided treatments. 

Federal Officials Turning On The HEAT on Health Care Fraud

 

The Florida and Detroit indictments reflect the growing commitment and cooperation among federal and state officials to investigation and prosecution of health care fraud using Medicare Fraud Task Forces operating as part of HEAT.  Drawing upon successful experiences gained from Medicare Fraud Task Forces operating in Miami and Los Angeles since 2007, HEAT is an expanded multi-agency effort jointly announced by HHS and DOJ in May, 2009 that uses a multi-agency team of federal, state and local investigators to investigate and combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. Since strike force operations began in March 2007, DOJ officials report that the Medicare Fraud Task Forces already have resulted in the indictment of 257 defendants in 115 cases for their allegedly fraudulently billing Medicare for more than $600 million.

Before the May 20, 2009 HEAT announcement, Medicare Fraud Strike Forces operating demonstration projects in South Florida and Los Angeles already had produced a number of indictments. The Medicare Fraud Strike Force team operating in South Florida has already convicted 146 defendants and secured $186 million in criminal fines and civil recoveries.  After the success of operations in South Florida, the Medicare Fraud Strike Force expanded in May 2008 to phase two in Los Angeles, where 37 defendants have been charged with criminal health care fraud offenses.  To date in the Los Angeles cases, more than $55 million has been ordered in restitution to the Medicare program.  DOJ and HHS officials have indicated that the success of these demonstration projects lies behind the founding of the HEAT initiative.

The heightened emphasis on enforcement of federal health care fraud laws reflected in the HEAT program the enactment of recent amendments to the False Claims Act, 31 U.S.C. § 3729 (FCA)  under the “Fraud Enforcement and Recovery Act of 2009”(FERA).  The FERA amendments increase the likelihood both that whistleblowers will turn in health care providers and other individuals and organizations that file false claims in violation of the FCA and the liability that violators may incur for that misconduct.

The FERA amendments and the HEAT Team and Strike Force activities are part of a broader emphasis in the enforcement of federal health care fraud laws by both the Administration and Congress.  President Obama’s proposed Fiscal Year 2010 budget seeks to further increase funding for fraud prevention and enforcement by investing $311 million — a 50 percent increase from 2009 funding — to strengthen program integrity activities within the Medicare and Medicaid programs.  The Obama Administration anticipates that all combined, the anti-fraud efforts in the President’s budget could save $2.7 billion over five years by improving oversight and stopping fraud in the Medicare and Medicaid programs, including the Medicare Advantage and Medicare prescription drug programs.  Many state agencies also are stepping up their health care fraud investigations and enforcement.

In light of this new emphasis upon health care fraud detection and enforcement, health care providers now more than ever need to prepare to demonstrate the appropriateness and defensibility of their health care billing and other compliance efforts.

Curran Tomko and Tarski LLP Health Care Practice Chair Cynthia Marcotte Stamer has extensive experience advising and assisting health care practitioners and other businesses and business leaders to establish, administer, investigate and defend health care fraud and other compliance and internal control policies and practices to reduce risk under federal and state health care and other laws. You can get more information about her health industry experience here.  

If you need assistance with these or other compliance concerns, wish to inquire about arranging for compliance audit or training, or need legal representation on other matters please contact Cynthia Marcotte Stamer, CTT Health Care Practice Group Chair, at cstamer@cttlegal.com, 214.270.2402 or your other favorite Curran Tomko Tarski LLP attorney. 

Other Helpful Resources & Other Information

We hope that this information is useful to you.  If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here. You can access other recent updates and other informative publications and resources provided by Curran Tomko Tarski LLP attorneys and get information about its attorneys’ experience, briefings, speeches and other credentials here.

For important information concerning this communication click here.  If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

©2009 Cynthia Marcotte Stamer.  All rights reserved. 

Leave a Comment » | Anti-KickBack, Doctor, false claims act, Federal Sentencing Guidelines, Health Care, Health Care Finance, Health Care Fraud, Health Care Provider, Hospital, Medicaid, Medicare, OIG, Physician | Tagged: , , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

53 Doctors, Health Care Executives & Beneficiaries Indicted For Involvement In A $50 Million Alleged False Billing Ring

June 24, 2009

Fifty-three people have been indicted for schemes to submit more than $50 million in false Medicare claims in the continuing operation of the Medicare Fraud Strike Force in Detroit, Attorney General Eric Holder, Department of Health and Human Services (HHS) Secretary Kathleen Sebelius, and FBI Director Robert Mueller announced today (June 24, 2009).

The charges were unsealed today against the 53 individuals who are accused of various Medicare fraud offenses, including conspiracy to defraud the Medicare program, criminal false claims and violations of the anti-kickback statutes.  The indictments returned by a grand jury in Detroit resulted in arrests in Miami, New York City and Detroit. 

According to the DOJ, federal agents from the FBI and the HHS Office of Inspector General (HHS-OIG) began executing arrest warrants and made arrests in Detroit, Miami and New York City earlier today as part of a concentrated effort targeting infusion therapy and physical/occupational therapy providers involved in schemes orchestrated to defraud the Medicare program.

Collectively, the indictment accuses the physicians, medical assistants, patients, company owners and executives charged in the indictments of conspiring to submit more than $50 million in false claims to the Medicare program.  According to the indictments, the defendants participated in schemes to submit claims to Medicare for treatments that were in fact medically unnecessary and oftentimes, never provided.  In many cases, indictments also allege that beneficiaries accepted cash kickbacks in return for allowing providers to submit forms saying they had received the unnecessary and not provided treatments.  An indictment is merely an allegation, and defendants are presumed innocent until and unless proven guilty.

The investigation and enforcement action that lead to today’s indictment was conducted as part of the continuing activities of the new interagency Health Care Fraud Prevention and Enforcement Action Team (HEAT) that DOJ and HHS jointly announced last month.  On May 20, 2009, DOJ and HHS jointly announced they were combining forces to find and prosecute health care fraud through the HEAT and identified Detroit and Houston as cities targeted for Medicare Fraud Strike Force attention.

Before the May 20, 2009 HEAT announcement, Medicare Fraud Strike Forces operating demonstration projects in South Florida and Los Angeles already had produced a number of indictments. The Medicare Fraud Strike Force team operating in South Florida has already convicted 146 defendants and secured $186 million in criminal fines and civil recoveries.  After the success of operations in South Florida, the Medicare Fraud Strike Force expanded in May 2008 to phase two in Los Angeles, where 37 defendants have been charged with criminal health care fraud offenses.  To date in the Los Angeles cases, more than $55 million has been ordered in restitution to the Medicare program.  The success of these demonstration projects lies behind the founding of the HEAT initiative.

The heightened emphasis on enforcement of federal health care fraud laws reflected in the HEAT program the enactment of recent amendments to the False Claims Act, 31 U.S.C. § 3729 (FCA)  under the “Fraud Enforcement and Recovery Act of 2009”(FERA).  The FERA amendments increase the likelihood both that whistleblowers will turn in health care providers and other individuals and organizations that file false claims in violation of the FCA and the liability that violators may incur for that misconduct.

The FERA amendments and the HEAT Team and Strike Force activities are part of a broader emphasis in the enforcement of federal health care fraud laws by both the Administration and Congress.  President Obama’s proposed Fiscal Year 2010 budget seeks to further increase funding for fraud prevention and enforcement by investing $311 million — a 50 percent increase from 2009 funding — to strengthen program integrity activities within the Medicare and Medicaid programs.  The Obama Administration anticipates that all combined, the anti-fraud efforts in the President’s budget could save $2.7 billion over five years by improving oversight and stopping fraud in the Medicare and Medicaid programs, including the Medicare Advantage and Medicare prescription drug programs.  Many state agencies also are stepping up their health care fraud investigations and enforcement.

In light of this new emphasis upon health care fraud detection and enforcement, health care providers now more than ever need to prepare to demonstrate the appropriateness and defensibility of their health care billing and other compliance efforts.

Curran Tomko and Tarski LLP Health Care Practice Chair Cynthia Marcotte Stamer has extensive experience advising and assisting health care practitioners and other businesses and business leaders to establish, administer, investigate and defend health care fraud and other compliance and internal control policies and practices to reduce risk under federal and state health care and other laws. You can get more information about her health industry experience here.  

If you need assistance with these or other compliance concerns, wish to inquire about arranging for compliance audit or training, or need legal representation on other matters please contact Cynthia Marcotte Stamer, CTT Health Care Practice Group Chair, at cstamer@cttlegal.com, 214.270.2402 or your other favorite Curran Tomko Tarski LLP attorney. 

Other Helpful Resources & Other Information

We hope that this information is useful to you.  If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here. You can access other recent updates and other informative publications and resources provided by Curran Tomko Tarski LLP attorneys and get information about its attorneys’ experience, briefings, speeches and other credentials here.

For important information concerning this communication click here.  If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

©2009 Cynthia Marcotte Stamer.  All rights reserved. 

Leave a Comment » | Anti-KickBack, Corporate Compliance, Doctor, false claims act, Federal Sentencing Guidelines, Health Care, Health Care Finance, Health Care Fraud, Health Care Provider, Hospital, Medicaid, Medicare, Medicare Advantage, OIG, Physician, Reimbursement | Tagged: , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Cindy Mann Appointed Director of the Center for Medicaid and State Operations

June 3, 2009

U. S. Health and Human Services Secretary Kathleen Sebelius recently announced the appointment of Cindy Mann to serve as Director of the Center for Medicaid and State Operations (CMSO), part of the Centers for Medicare & Medicaid Services (CMS).  Secretary Sebelius announced the appointment May 29, 2009.

Prior to her appointment, Mann most recently served as a research professor and executive director of the Center for Children and Families at Georgetown University’s Health Policy Institute. From 1999-2001, Ms. Mann was the director of the Family and Children’s Health Program Group at the Health Care Financing Administration (HCFA), now the Centers for Medicare & Medicaid Services. In that capacity, she directed, at the federal level, the implementation and oversight of the Medicaid program with respect to families, children, and pregnant women, and oversaw the implementation of CHIP. Prior to her work at HCFA, Ms. Mann led the Center on Budget and Policy Priorities’ federal and state health policy work. She also has extensive state-level experience, having worked on health care, welfare, and public finance issues in Massachusetts, Rhode Island, and New York. She holds a law degree from New York University School of Law.

Cynthia Marcotte Stamer and other attorneys practicing with Curran Tomko Tarski LLP are experienced advising and representing health industry clients about federal and state regulatory, reimbursement, grant, enforcement and other health industry risk management and compliance concerns.   If you have questions about these matters, please contact Ms. Stamer at 214.270.2402.

For More Information

We hope that this information is useful to you. If you need assistance responding to concerns about the matters discussed in this publication or other health care concerns, wish to obtain information about arranging for training or presentations by Ms. Stamer, wish to suggest a topic for a future program or update, or wish to request other information or materials, please contact Ms. Stamer via telephone at (214) 270-2402 or via e-mail to cstamer@CTTLegal.com.

You can review other recent updates and other publications by Ms. Stamer and other helpful health care resources and additional information about Ms. Stamer and her experience, see Stamer Health Industry Experience. If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here or by registering to participate in the Solutions Law Press Health Care Update blog at Health Care Update Blog. For important information concerning this communication click here.    If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

Leave a Comment » | Anti-KickBack, Childrens Health Insurance Program, Health Care, Health Care Fraud, Health Care Provider, Hospital, Medicaid, Medicare, Medicare Advantage, OIG, Physician, Public Policy, Reimbursement, Stark, Uncategorized | Permalink
Posted by Cynthia Marcotte Stamer

Newly Enacted FERA Amendments To False Claims Act Signal New Risks For Health Industry Organizations & Others

May 26, 2009

Health care providers and other parties covered by the False Claims Act, 31 U.S.C. § 3729 (FCA), now face expanded whistleblower and other liability under amendments to the FCA enacted under the “Fraud Enforcement and Recovery Act of 2009”(FERA).  The amendments increase the likelihood both that whistleblowers will turn in health care providers and other individuals and organizations that file false claims in violation of the FCA and the liability that violators may incur for that misconduct.

Signed into law by President Obama last Wednesday (May 20, 2009), FERA immediately upon enactment:

  • Amends the whistleblower protections afforded to employees, contractors and agents who suffer retaliation for taking lawful efforts to stop violations of the FCA and to make it easier for those individuals to pursue retaliation claims;
  • Expands liability under for making false or fraudulent claims to the federal government under the FCA;
  • Applies liability under the FCA for presenting a false or fraudulent claim for payment or approval (currently limited to such a claim presented to an officer or employee of the federal government); and
  • Requires persons who violate such Act to reimburse the federal government for the costs of a civil action to recover penalties or damages 

Concurrent with President Obama’s signature of FERA into law, the U.S. Departments of Justice (DOJ) and Health & Human Services (HHS) jointly announced the expansion of federal health care fraud enforcement efforts.  On May 20, 2009, HHS and DOJ announced their activation of a new interagency team to combat health care fraud highlights the increasing need for health care providers and health plans to review and tighten their practices for dealing with Medicare and other federal programs to survive scrutiny under federal health care fraud initiatives.  Coupled with FERA and the already significant increase in federal health care fraud detection and enforcement activities in recent years and a proposed 50 percent increase in funding for these activities included in President Obama’s Fiscal Year 2010 budget, health care providers and payers must be prepared to defend their dealing with Medicare, Medicaid and other federal health care programs.

The expanded protections afforded under FERA to whistleblowers and others suffering retaliation for opposing or reporting illegal actions can be expected to serve as a key tool in these efforts. These new retaliation safeguards are designed further increase the likelihood that employees and other insiders will help government officials ferret out false claims and other fraud. Specifically with regard to retaliatory action claims Section 4(d) of FERA amends 31 U.S.C.§ 3730(h) to provide for the recovery of “all relief necessary to make that employee, contractor, or agent whole” where that individual is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment because of lawful acts he does or takes on behalf of an individual in furtherance of other efforts to stop a violation of the FCA. 

FERA expressly provides that relief to victims of retaliation will include “reinstatement with the same seniority status that employee, contractor, or agent would have had but for the discrimination, 2 times the amount of back pay, interest on the back pay, and compensation for any special damages sustained as a result of the discrimination, including litigation costs and reasonable attorneys’ fees.” 

The FERA amendments to the FCA, the new TEAMS enforcement effort announced simultaneously with its signature into law mean that health care industry organizations and others covered by the FCA must implement appropriate fraud prevention, detection, redress and other procedures to help defend against possible FCA or other health care fraud claims and investigations.

The attorneys at Curran Tomko Tarski, LLC have extensive experience representing and advising health industry and other clients against FCA and other federal health care and fraud laws. 

For More Information

We hope that this information is useful to you. If you need assistance with auditing or defending health care fraud concerns or other health care compliance, risk management, transactions or operations concerns, please contact Curran Tomko Tarski LLP Partners Cynthia Marcotte Stamer at (214) 270-2402, CStamer@CTTLegal.com; Michael T. Tarski at (214) 270-1420 or MTarski@CTTLegal.com; Edwin J. Tomko at (214) 270-1405 or ETomko@CTTLegal.com.

You can review other recent health care and internal controls resources and additional information about the health industry and white collar experience of the Curran Tomko Tarski LLP attorneys at http://www.CTTLegal.com. If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail – by creating or updating your profile at CTTLegal.com or e-mailing this information to CStamer@CTTLegal.com.

Leave a Comment » | Anti-KickBack, ARRA, Construction, Corporate Compliance, Doctor, Federal Sentencing Guidelines, Grants, Health Care, Health Care Fraud, Health Care Provider, Health Care Reform, Health Plan, Health Policy, Hospital, OCR, OIG, Physician, Prescription Drugs, Reimbursement, Stark | Tagged: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Stamer To Discuss “Making Gainsharing Work: Managing Physician Performance” At June 17, 2009 Dallas Bar Association Health Law Section Meeting

May 26, 2009

Health care organizations, health plans and regulars increasingly point to gainsharing and pay-for-performance strategies as key to securing needed key physician buy-in and performances to achieve desired health care quality and cost objectives.  Using physician gainsharing to promote desired performances within the bounds of the law without undesirable side effects involves more than staying within the STARK exceptions and anti-kickback safe harbors. 

Curran, Tomko Tarski, LLP attorney Cynthia Marcotte Stamer will discuss key strategies and processes for designing and administering legally defensible pay-for-performance and other gainsharing arrangements that promote desired outcomes in operation at the Dallas Bar Association Health Law Section meeting on June 17, 2009. 

Former Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, attorney and author Cynthia Marcotte Stamer is nationally and internationally recognized for her legal work, publications and programs, and advocacy on health industry performance management and other health industry matters.  Ms. Stamer works extensively with health care organizations, managed care and health insurance organizations, governments and others to manage performance and legal risks.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization, Ms. Stamer combines her more than 22 years of health industry regulatory and risk management experience with an in-depth knowledge of workforce management and regulation to help clients manage performance and legal and operational risks.  Her experience includes advising public and private health industry clients domestically and internationally on a wide range of matters.  A widely published author and popular speaker, Ms. Stamer’s insights on health industry matters also are quoted in HealthLeaders, Managed Care Executive, the Wall Street Journal and many other national popular, business and industry publications.

 Ms. Stamer is scheduled to begin her remarks at Noon on June 17, 2009 at the offices of the Dallas Bar Association located at 2101 Ross Avenue, Dallas, Texas 75201.  For additional information, call the Dallas Bar Association at 214-220-7400 or see http://www.dallasbar.org.

Leave a Comment » | Anti-KickBack, Doctor, Health Care, Health Care Fraud, Health Care Provider, Health Care Reform, Health Plan, Health Policy, HIPAA, Hospital, Licensing, Medical Licensure, Medical Malpractice, Medicare Advantage, OCR, OIG, Peer Review, Physician, Physician Licensing, Public Policy, Reimbursement, Stark | Tagged: , , , , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

DOJ/HHS Step Up Health Care Fraud Enforcement By Announcing New Interagency Health Care Fraud Prevention and Enforcement Action Team

May 20, 2009

Lead DOJ Health Care Fraud Enforcer Speaks In Dallas Tomorrow

The joint announcement today (May 20, 2009) by the U.S. Departments of Justice (DOJ) and Health & Human Services (HHS) of a new interagency team to combat health care fraud highlights the increasing need for health care providers and health plans to review and tighten their practices for dealing with Medicare and other federal programs to survive scrutiny under federal health care fraud initiatives.   Houston and Detroit are targeted for the attention of a new Strike Force.

Participants attending tomorrow’s Dallas Health Industry Council Southwest Healthcare Transaction Conference will get to hear the latest about these and other federal health care fraud prevention and enforcement activities from one of its key players. The Justice Department’s lead federal health care fraud prosecutor, John “Jay” S. Darden, the U.S. Department of Justice Assistant Chief for Healthcare Fraud is scheduled to provide an update on these and other federal regulatory and enforcement activities affecting health care transactions when he speaks at the Conference tomorrow afternoon at the Omni Mandalay Hotel Dallas at Las Colinas at 1:30 p.m.

Attorney General Eric Holder and Health and Human Services (HHS) Secretary Kathleen Sebelius announced the creation of the Health Care Fraud Prevention and Enforcement Action Team (HEAT), to combat Medicare fraud and the expansion of Strike Force team operations to Detroit and Houston.  Medicare Fraud Strike Forces, currently in operation in South Florida and Los Angeles, fight Medicare fraud on a targeted local level.  Statements made by Secretary Sebelius and Attorney General Holder in connection with the announcement of HEAT and the Strike Force Expansion make clear that the Obama Administration views health care fraud enforcement and prevention as a key element of its efforts to control health care costs.

The HEAT team will include senior officials from DOJ and HHS who will build upon and strengthen existing programs to combat fraud while also investing new resources and technology to prevent fraud, waste and abuse before it happens.  Efforts will include the expansion of joint DOJ-HHS Medicare Fraud Strike Force teams that have been successfully fighting fraud in South Florida and Los Angeles. 

Established in 2007, these Strike Force teams have a proven record of success using a “data-driven” approach to identify unexplainable billing patterns and investigating these providers for possible fraudulent activity.  The Medicare Fraud Strike Force team operating in South Florida has already convicted 146 defendants and secured $186 million in criminal fines and civil recoveries.  After the success of operations in South Florida, the Medicare Fraud Strike Force expanded in May 2008 to phase two in Los Angeles, where 37 defendants have been charged with criminal health care fraud offenses.  To date in the Los Angeles cases, more than $55 million has been ordered in restitution to the Medicare program. 

In addition to health care fraud enforcement and prosecution, HHS and DOJ also view prevention as critical to reforming the system.  Therefore, in addition to investigating and prosecuting fraud, the HEAT team will also focus critical resources on preventing fraud from occurring in the first place.  These efforts are expected to include:

  • Drawing from demonstration projects by the HHS Inspector General and the Centers for Medicare & Medicaid Services (CMS) that have focused on suppliers of durable medical equipment (DME) including increasing site visits to potential suppliers to prevent imposters from posing as legitimate DME providers. 
  • Increasing training for providers on Medicare compliance, offering providers the resources and the knowledge they need to help identify and prevent fraud.
  • Improving data sharing between CMS and law enforcement to help identify patterns that lead to fraud.
  • Strengthening program integrity activities to monitor and ensure Medicare Parts C (Medicare Advantage plans) and D (prescription drug programs) compliance and enforcement.

The Attorney General and the HHS Secretary also called on the American people to visit a new Web site http://www.hhs.gov/stopmedicarefraud or call 1-800-HHS-TIPS (1-800-447-8477) to report suspected Medicare fraud.

The HEAT Team and Strike Force activities are part of a broader emphasis in the enforcement of federal health care fraud laws.  President Obama’s proposed Fiscal Year 2010 budget seeks to further increase funding for fraud prevention and enforcement by investing $311 million — a 50 percent increase from 2009 funding — to strengthen program integrity activities within the Medicare and Medicaid programs.  The Obama Administration anticipates that all combined, the anti-fraud efforts in the President’s budget could save $2.7 billion over five years by improving oversight and stopping fraud in the Medicare and Medicaid programs, including the Medicare Advantage and Medicare prescription drug programs.

For More Information

We hope that this information is useful to you. If you need assistance responding to concerns about the matters discussed in this publication or other health care concerns, wish to obtain information about arranging for training or presentations by Ms. Stamer, wish to suggest a topic for a future program or update, or wish to request other information or materials, please contact Ms. Stamer via telephone at (214) 270-2402 or via e-mail to cstamer@CTTLegal.com.

You can review other recent updates and other publications by Ms. Stamer and other helpful health care resources and additional information about Ms. Stamer and her experience, see Stamer Health Industry Experience. If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here or by registering to participate in the Solutions Law Press Health Care Update blog at Health Care Update Blog. For important information concerning this communication click here.    If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

Leave a Comment » | Anti-KickBack, ARRA, ARRA Funding, Corporate Compliance, Doctor, Federal Sentencing Guidelines, Health Care, Health Care Fraud, Health Care Provider, Health Care Reform, Health Policy, Hospital, Medicare Advantage, OCR, OIG, Physician, Prescription Drugs, Privacy, Reimbursement, Stark | Tagged: , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

CMS Plans Hospital & Hospital Quality Open Door Forum to Wednesday, May 6, 2009

April 21, 2009

The Centers for Medicare & Medicaid Services (CMS) announced today that it has rescheduled its next Hospital & Hospital Quality Open Door Forum to Wednesday, May 6, 2009 from 2-3pm ET. Interested persons can participate by phone dial 1-800-837-1935 using Conference ID 89323669.  For more information on this or other upcoming or recently recorded forums sponsored by CMS or other Department of Health & Human Services Agencies, see http://www.cms.hhs.gov/opendoorforums or check out the Breaking News link on CynthiaStamer.com.  

For assistance with compliance and risk management policies, practices or programs, assessing the strength of your controls in addressing these laws or other healthcare laws and regulations, or in addressing other compliance or health care concerns, please contact Cynthia Marcotte Stamer at cstamer@CTTLegal.com or (214) 270- 2402.

Leave a Comment » | Health Care, Health Care Fraud, Health Care Provider, Hospital, OIG, Uncategorized | Permalink
Posted by Cynthia Marcotte Stamer

HHS Releases Report Comparing Average Sales Price to Average Manufacturer Prices of Prescription Drugs

April 20, 2009

The Department of Health & Human Services (HHS) Office of Inspector General (OIG) released its latest “Comparison of Third-Quarter 2008 Average Sales Prices and Average Manufacturer Prices: Impact on Medicare Reimbursement for First Quarter 2009″ (the “Report”) on April 17, 2009.  The findings are used to help determined Medicare Part B reimbursement rates for prescription drugs.   You can review the entire Report at http://www.oig.hhs.gov/oei/reports/oei-03-09-00150.pdf.

Mandated by Congress under Section 1847A(d)(2)(B) of the Social Security Act (the Act), the Report reviews the average sales prices (ASP) and average manufacturer prices (AMP) for Medicare Part B prescription drugs to identify the ASPs that exceed AMPs by at least 5 percent. The review also determines the impact of lowering reimbursement amounts for drugs that meet the 5-percent threshold. Pursuant to sections 1847A(d)(3)(A) and (B) of the Act, if OIG finds that the ASP for a drug exceeds the AMP by a certain percentage (currently 5 percent), HHS may disregard the ASP for the drug when setting reimbursement amounts. According to the Report, of the 325 drugs with complete AMP data, OIG found 15 met the 5-percent threshold under the revised ASP payment methodology recently mandated. Twelve of these 15 drugs were previously eligible for price adjustment under the revised methodology, with 2 drugs meeting the 5-percent threshold in each of the past 7 quarters. OIG estimates that, if reimbursement amounts for all 15 drugs had been based on 103 percent of the AMPs, Medicare expenditures would have been reduced by almost three-quarters of a million dollars in the first quarter of 2009. The Report also states that of the 129 drugs with only partial AMP data in the third quarter of 008, 21 had ASPs that exceeded the AMPs by at least 5 percent in the third quarter of 2008.

Under the revised methodology, 12 of the 21 drugs would have met the 5 percent threshold in at least 2 of the past 7 quarters, dating back to the first quarter of 2007. OIG estimates that Medicare expenditures would have been reduced by $9 million during the first quarter of 2009 if reimbursement amounts for all 21 drugs had been based on 103 percent of the AMPs.

If you have questions about the Report, Medicare reimbursement or compliance or any other health care compliance and risk management policies, practices or programs, assessing the strength of your controls in addressing these laws or other healthcare laws and regulations, or in addressing other compliance or health care concerns, please contact Cynthia Marcotte Stamer at cstamer@CTTLegal.com or (214) 270- 2402. For More Information We hope that this information is useful to you. If you need assistance responding to concerns about the matters discussed in this publication or other health care concerns, wish to obtain information about arranging for training or presentations by Ms. Stamer, wish to suggest a topic for a future program or update, or wish to request other information or materials, please contact Ms. Stamer via telephone at (214) 270-2402 or via e-mail to cstamer@CTTLegal.com. You can review other recent updates and other publications by Ms. Stamer and other helpful health care resources and additional information about Ms. Stamer and her experience, see Stamer Health Industry Experience. If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here or by registering to participate in the Solutions Law Press Health Care Update blog at slphealthcareupdate.wordpress.com. For important information concerning this communication click here. If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

Leave a Comment » | Doctor, Health Care, Health Plan, Hospital, OIG, Prescription Drugs, Reimbursement | Tagged: , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

OIG Enters Into $2 Million Civil Monetary Penalty Settlement With Radiology Practice

March 29, 2009

A Las Vegas, Nevada radiology practice, West Valley Imaging Limited Partnership, and its principals, William L. Boren, M.D. and Luke S. Cesaretti, M.D., will pay $2 million and comply with the terms of an Integrity Agreement for five years to resolve allegations that they submitted false or fraudulent claims to Medicare, under a Civil Monetary Penalty (“CMP”) settlement agreement announced by the Office of Inspector General (“OIG”) for the Department of Health and Human Services on March 25, 2009.

One of the largest CMP settlements ever negotiated under the OIG’s CMP authority, the West Valley CMP Settlement announcement comes just one day after the OIG announced changes to the conditions under which health care providers can use the OIG’s Self-Disclosure Protocol (“SDP”) to resolve CMP exposures for federal health care fraud violations and established $50,000 as the minimum settlement amount under the SDP program.

The West Valley CMP settlement resolves OIG charges that the defendants intentionally defrauded Medicare by improperly providing diagnostic tests to Medicare beneficiaries without the required treating physician’s orders; billing for certain tests under Current Procedural Terminology codes not supported by the medical records; and failing to satisfy certain other Medicare billing and coverage requirements.

The West Valley CMP settlement reflects the growing perils that health care providers face when charged with violating the Stark Law, Anti-Kickback Statute or other federal health care fraud laws.  Health care providers should seek consult with qualified legal counsel within the scope of attorney-client privilege about the adequacy of their current policies and procedures and the development, implementation and enforcement of appropriate policies and practices to manage exposures to health care fraud or other liabilities taking into account the specific nature and scope of that health care provider’s health care operations. As part of this process, health care providers should work with their legal counsel within the scope of attorney-client privilege to decide and implement appropriate oversight and audit procedures and processes for investigating and addressing any issues that might arise in connection with an audit. While each health care provider generally should work with their legal counsel to define the scope and other particulars of such audit, every health care provider as part of this effort generally should undergo a periodic assessment by outside counsel of the adequacy of its Stark compliance efforts.

 

For assistance in reviewing and updating your Stark Law, Anti-Kickback Statute, or other health care compliance and risk management policies, practices or programs, assessing the strength of your controls in addressing these laws or other healthcare laws and regulations, or in addressing other compliance or health care concerns, please contact Cynthia Marcotte Stamer at cstamer@solutionslawyer.net or 469.767.8872.

Leave a Comment » | Anti-KickBack, Health Care, Health Care Fraud, Health Care Provider, OIG, Physician | Permalink
Posted by Cynthia Marcotte Stamer

OIG Narrows Availability of Self-Disclosure Protocol, Sets Minimum Settlement At $50K

March 29, 2009

The Department of Health & Human Services Office of Inspector General (OIG) recently narrowed the circumstances under which health care providers can use its Self-Disclosure Protocol (SDP) to resolve Civil Monetary Penalty (CMP) exposures for federal health care fraud violations and established $50,000 as the minimum settlement amount under the SDP program.  The announcement of modifications to the program corresponds with the OIG’s March 25, 2009 announcement that a Las Vegas, Nevada radiology practice, West Valley Imaging Limited Partnership, and its principals, William L. Boren, M.D., and Luke S. Cesaretti, M.D. must pay $2 million and comply with the terms of an Integrity Agreement for five years to resolve allegations that they submitted false or fraudulent claims to Medicare , under a Civil Monetary Penalty (CMP) settlement agreement.

 

Under the Civil Monetary Penalties Law (“CMPL”), 42 U.S.C. § 1320a-7a, and other provisions of the Social Security Act, health care providers risk the assessment of CMPs, exclusion from participation in all Federal health care programs or both if they knowingly and willfully:

 

ü      Offer or pay remuneration to induce the referral of or solicit or receive remuneration in return for the referral of Federal health care program business in violation of the Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b));

ü      Present or cause to be presented a claim that the person knows or should know is for a service for which payment may not be made under 42 U.S.C. § 1395nn, the physician self-referral or “Stark” law. 42 U.S.C. § 1395nn(g)(3); or

ü      Engages in certain other prohibited activities under federal healthcare fraud laws.

 

For an Anti-Kickback violation, the OIG may seek a penalty of up to $50,000 for each improper act and damages of up to three times the amount of remuneration at issue (regardless of whether some of the remuneration was for a lawful purpose). 42 U.S.C. § 1320a-7a(a).  As part of the federal government’s broader effort to control federal health care spending, OIG and other federal regulators are stepping up enforcement of these and other federal health care laws.

 

In keeping with this expanding enforcement commitment, the OIG announced in a March 24, 2009 Open Letter To Health Care Providers that health care providers generally will only be able to use the SDP to address health care fraud violations involving a violation of the federal Anti-Kickback Statute.  Effective March 24, 2009, the SDP cannot be used to resolve physician self-referral violations of the Stark law that do not also involve violations of the Anti-Kickback Statute.  The OIG previously allowed health care providers the option to self-disclose and settle self-discovered violations of either the Anti-Kickback Statute or the Stark law under the SDP as a means of avoiding the uncertainty, disruptions and costs associated with a government-directed investigation and prosecution for those violations.  The March 24, 2009 Open Letter announced that OIG will no longer accept disclosure of a matter that involves only liability under the physician self-referral law in the absence of a colorable anti-kickback statute violation. However, OIG will continue to accept providers into the SDP when the disclosed conduct involves colorable violations of the anti-kickback statute, whether or not it also involves colorable violations of the physician self-referral law.

 

In addition to narrowing the scope of the SDP, the March 24, 2009 Open Letter also announced that the OIG now will require a health care provider a minimum settlement of at least $50,000 to use the SDP. The OIG indicated this minimum settlement amount is consistent with OIG’s statutory authority to impose a penalty of up to $50,000 for each kickback and an assessment of up to three times the total remuneration. See 42 U.S.C. § 1320a-7a(a)(7).  Had this new minimum settlement policy been in effect at the time, it would have more than doubled the $21,025.62 settlement that San Jacinto Methodist Hospital (SJMH) paid in January, 2009 to settle its CMP exposure arising from its self-disclosure to the OIG that it had entered into an arrangement with a physician for a Medical Director position that included the physician occupying hospital space for private use and utilizing hospital personnel for clerical assistance related to the physician’s private practice patient visits without any contractual entitlement to do so.

 

Reflecting the continuing emphasis of the OIG on vigorous enforcement of federal health care fraud laws, the announcement of the SDP changes were immediately followed by the OIG’s announcement of one of the largest CMP settlements ever negotiated under the OIG’s CMP authority.  On March 25, 2009, OIG announced that West Valley Imaging Limited Partnership, and its principals, William L. Boren, M.D., and Luke S. Cesaretti, M.D. must pay $2 million and comply with the terms of an Integrity Agreement for five years to resolve allegations that they submitted false or fraudulent claims to Medicare.  The settlement resolves OIG charges that the defendants intentionally defrauded Medicare by improperly providing diagnostic tests to Medicare beneficiaries without the required treating physicians’ orders, billing for certain tests under Current Procedural Terminology codes not supported by the medical records, and failing to satisfy certain other Medicare billing and coverage requirements. 

 

Even prior to the March 24, 2009 Open Letter, OIG habitually has assessed significant penalties against health care providers found to have violated the Anti-Kickback Statute, the Stark Law, and other federal health care fraud laws – including those violations self-disclosed under the SDP.  In December, 2008, for instance King’s Daughters’ Hospital and Health Services in Indiana paid $391,500 to settle alleged violations of the Civil Monetary Penalties Law provisions applicable to kickbacks arising from its self-disclosure of compensation arrangements with employed physicians under which physicians were compensated for services that were not personally performed by them.

 

Health care providers should seek consult with qualified legal counsel within the scope of attorney-client privilege about the adequacy of their current policies and procedures and the development, implementation and enforcement of appropriate policies and practices to manage exposures to health care fraud or other liabilities taking into account the specific nature and scope of that health care provider’s health care operations.  As part of this process, health care providers should work with their legal counsel within the scope of attorney-client privilege to decide and implement appropriate oversight and audit procedures and processes for investigating and addressing any issues that might arise in connection with an audit. While each health care provider generally should work with their legal counsel to define the scope and other particulars of such audit, every health care provider as part of this effort generally should undergo a periodic assessment by outside counsel of the adequacy of its Stark compliance efforts.

 

You also can review guidance governing the SDP at: http://oig.hhs.gov/fraud/selfdisclosure.asp.  For examples of past settlements under the SDP law, see http://oig.hhs.gov/fraud/enforcement/cmp/kickback.asp.

 

For assistance in reviewing and updating your Stark Law, Anti-Kickback Statute, or other health care compliance and risk management policies, practices or programs, assessing the strength of your controls in addressing these laws or other healthcare laws and regulations, or in addressing other compliance or health care concerns, please contact Cynthia Marcotte Stamer at cstamer@solutionslawyer.net or 469.767.8872.   To review  and register to receive other helpful updates or for additional information about Ms. Stamer and her experience, see http://www.cynthiastamer.com/healthcare.asp.

 

Leave a Comment » | Anti-KickBack, Health Care, Health Care Fraud, Health Care Provider, OIG, Physician, Stark | Permalink
Posted by Cynthia Marcotte Stamer

Next Entries »