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Excess Readmissions Mean Lower Medicare Reimbursement Rates for More than 2,000 Hospitals, Including 131 in Florida

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

Lower Medicare reimbursement rates are coming in October of 2012, to 2,211 hospitals around the country, including 131 in Florida. This is allegedly due to excessive readmission rates in these hospitals between July 2008 and June 2011, according to the Centers for Medicare and Medicaid Services (CMS). This story was originally reported by Kaiser Health News on August 13, 2012, and by other sources.

To read more on the readmissions reduction program, click here.


Starting in October 2012, Millions of Dollars in Penalties will be Deducted from Medicare Reimbursements.

Starting October 1, 2012, penalties will be deducted from Medicare reimbursements each time a hospital submits a claim.

All together these hospitals will give up about $280 million in Medicare funds over the next year as the government begins a push to start paying health care providers based on the quality provided, according to the Kaiser Health News article. The government apparently considers readmissions a prime symptom of an overly expensive and uncoordinated health system.

The CMS records show nine hospitals in Florida, including Florida Hospital in Orlando, will deal with a one percent (1%) decrease caused by the penalties.

To see the 2013 Medicare readmissions penalties in Florida, click here.

Medicare Attempting to Lower Readmission Rates.

According to the CMS nearly two million Medicare beneficiaries return to the hospital within a month of being discharged, costing Medicare $17.5 billion in additional hospital bills. CMS states the national average readmission rate is slightly above nineteen percent (19%).

Who Will Lose the Most Medicare Funds?

The penalties will fall heaviest on hospitals in New Jersey, New York, the District of Columbia, Arkansas, Kentucky, Mississippi, Illinois, and Massachusetts. Hospitals that treat mostly low-income patients will be hit particularly hard as well. This is all according to the report by Kaiser Heath News.

The analysis of the penalties shows seventy-six percent (76%) of the hospitals that have a majority of low-income patients will lose Medicare funds.

More Than 1,100 Hospitals Will Not Be Penalized.

The CMS report found 1,156 hospitals with acceptable readmission rates. Those hospitals will not lose any money. The analysis showed, on average, the readmission penalties were lightest on hospitals in Utah, South Dakota, Vermont, Wyoming and New Mexico. Idaho was the only state where no hospital was penalized by Medicare.

The Maximum Penalty to Increase Next Year.

The CMS notes the maximum penalty will increase to two percent (2%) starting in October 2013, and then to three percent (3%) the following year.

These penalties are part of an effort by Medicare to use its financial backbone to force improvements in hospital quality.

On top of the readmission reduction program, on August 27, 2012, the CMS will begin the Recovery Audit Prepayment Review (RAPR), in which Recovery Audit Contractors (RACs) will review a number of hospitals’ Medicare claims.
I previous wrote about the RAPR, click here to read that post.

Contact Health Law Attorneys Experienced in Handling Medicare Audits.

The Health Law Firm’s attorneys routinely represent physicians, medical groups, clinics, pharmacies, durable medical equipment (DME) suppliers, home health agencies, nursing homes and other healthcare providers in Medicare investigations, audits and recovery actions.

To contact The Health Law Firm please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Sources:

Rua, Jordan. “Medicare To Penalize 2,211 Hospitals For Excess Readmissions.” Kaiser Health News. (August 13, 2012). From: http://www.kaiserhealthnews.org/stories/2012/august/13/medicare-hospitals-readmissions-penalties.aspx?referrer=search

Kaiser Health News. “First Hospital Penalties for High Readmissions Detailed.” Kaiser Health News. (August 13, 2012). From: http://www.kaiserhealthnews.org/daily-reports/2012/august/13/quality-issues.aspx?referrer=search

Health News Florida. “Readmit Rates Cost FL Hospitals.” Health News Florida. (August 13, 2012). From: http://www.healthnewsflorida.org/hnf_stories/read/readmit_rates_cost_fl_hospitals

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone:  (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.

Duke University Health System Pays $1 Million to Settle Allegations of False Claims in Whistleblower Lawsuit

1 Indest-2008-1By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

On March 21, 2014, Duke University Health System in Raleigh, North Carolina, settled a whistleblower/qui tam lawsuit, according to the Department of Justice (DOJ). The lawsuit, filed in 2012, stated that the three-hospital academic medical center is alleged to have fraudulently inflated its Medicare bills by unbundling a number of cardiac services and billing for physician assistants’ (PAs) time illegally. Duke University Health System agreed to pay $1 million to resolve these allegations.

Click here to read the press release from the DOJ.

Duke University Health System Accused of Submitting False Claims to Federal Health Care Programs.

According to the complaint, the lawsuit was originally filed by a former health care bill coder and quality-control auditor for Duke’s revenue-cycle subsidiary, Duke Patient Revenue Management Organization. The former employee accused Duke University Health System of allegedly making false claims to Medicare, Medicaid and TRICARE by billing the government for services provided by PAs during coronary artery bypass surgeries when the PAs were acting as surgical assistants, which is not allowed. The whistleblower also alleged the medical center increased billing by unbundling claims when the unbundling was not appropriate. These unbundled claims were associated with cardiac and anesthesia services, according to the complaint.

To read the whistleblower’s complaint filed in December of 2012, click here.

According to the DOJ, the claims resolved by the settlement are allegations only, and there has been no determination of liability.

Whistleblowers Who Report Fraud and False Claims Against the Government Are Usually Employees.

Doctors, nurses or staff employees working for hospitals, nursing homes, medical groups, home health agencies or others, often become aware of questionable activities. They are sometimes even asked to participate in it. In many cases the activity may amount to health care fraud.

It does not matter who you are. You may even be actively involved in the wrongdoing. This does not disqualify you from reporting the false claims activity or receiving a reward for doing so. In order to encourage employees with knowledge of fraudulent activity to come forward, the government will usually not seek to prosecute or punish that person in any way.

Normally the government will want to see some actual documentation of the claims submitted by the hospital or other institution. Usually physicians, nurses or staff employees have access to such documentation. Whistleblowers are urged to come forward as soon as possible. In many circumstances, documentation that shows the fraud “disappears” or cannot be located once it is known that a company is under investigation.

Of course, the larger the amount of money the government has been defrauded the more likely it will be that the government will be interested in pursuing the case and the larger the reward the whistleblower will receive if there is a recovery.

To read more on whistleblower cases, read my previous blogs. Click here for part one, and click here for part two.

Contact Health Law Attorneys Experienced with Qui Tam or Whistleblower Cases.

Attorneys with The Health Law Firm also represent health care professionals and health facilities in qui tam or whistleblower cases both in defending such claims and in bringing such claims. We have developed relationships with recognized experts in health care accounting, health care financing, utilization review, medical review, filling, coding, and other services that assist us in such matters. We have represented doctors, nurses and others as relators in bringing qui tam or whistleblower cases, as well.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Comments?

What do you think of this settlement? Do you think whistleblower lawsuits are becoming more common? Please leave any thoughtful comments below.

Sources:

Carlson, Joe. “Duke Pays $1 Million to Settle Whistle-Blower Case.” Modern Healthcare. (March 25, 2014). From: http://bit.ly/1g3W7yw

Department of Justice. “Duke University Health System, Inc. Agrees to Pay $1 Million For Alleged False Claims Submitted to Federal Health Care Programs.” Department of Justice. (March 21, 2014). From: http://www.justice.gov/usao/nce/press/2014/2014-mar-21.html

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 1996-2014 The Health Law Firm. All rights reserved.

Ambulance Company in Tennessee Settles A $2 Million Overpayment Lawsuit

George F. Indest III, Board Certified by The Florida Bar in Health Law

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law and Dr. Thu Pham, O.D., Law Clerk, The Health Law Firm Attorney

A Tennessee ambulance company and the U.S. Department of Health and Human Services (DHHS) announced a settlement in a case over a post payment audit for more than two million dollars in May 2012. Back in March of 2010, the Nashville ambulance company sued the DHHS after being sent a $2.65 million overpayment demand, according to the Nashville Business Journal.

To see the Nashville Business Journal article on the lawsuit, click here.

Huge Fine Found Using Error Rate Extrapolation Formula.

According to the lawsuit, the ambulance company claimed that the fine was based on incorrect accounting by a Medicare Administrative Contractor (MAC) for the DHHS. The contractor reviewed “a small sample of claims and determined that many did not meet Medicare coverage criteria.”

The actual overpayment on those claims was $10,764, which was determined to be an error rate of fifty-one percent (51%). The error rate was then used to extrapolate and obtain the $2.65 million figure which was demanded from the ambulance company.

Ambulance Company Files Administrative Appeal.

Upon administrative appeal, the ambulance company said most of its claims were determined to be appropriate, yet the error rate was never recalculated and the company was still stuck with a large bill.

Disputes of payments included bills for transporting dialysis patients by ambulance. The DHHS said those trips were not valid because they were not emergencies. The ambulance company refuted this contending that the trips did not have to be emergencies because they were ordered by a doctor.

Click here to read the entire lawsuit.

What You Should Know About the Use of Statistical Sampling and Extrapolation Formulas.

In both state Medicaid audits and in Medicare audits, we have experienced increased reliance by the auditing agency on use of mathematical extrapolation formulas to estimate the amount that should be repaid. The formula used usually takes the overpayment that has actually been found and, based on several factors, multiplies it out to many times the actual overpayment amount, as is the example in this case. We have seen ratios of as high as 1 to 150 (or 150 times the actual disallowed claims amount) calculated.

Things you should know about this are as follows:

1.  Neither the Medicare program nor the state Medicaid programs should use an extrapolation formula, unless:

  a. There is a “high” error rate in the claims that have been submitted; or

  b. There have been prior educational efforts or prior audits of the provider, and the provider

has failed to correct the problems in claims submission previously found.

2.  The states each have different guidelines, rules or regulations on when they will apply the statistical formula. Some do not use it at all. Some use a higher percentage error rate to prompt use of the formula and some lower. For example, North Carolina uses one of the lowest percentage error rates we have encountered; an error rate of more than five percent (5%) will prompt its Medicaid agency to apply the statistical extrapolation to the recovery amount.


Two Parties Settle.

On May 25, 2012, the United State District Court announced the ambulance company and the DHHS had settled and compromised. The lawsuit was dismissed against the DHHS without prejudice for a period of ninety (90) days.

Click here to see the order of dismissal.

Don’t Wait Until It’s Too Late; Consult with a Health Law Attorney Experienced in Medicare and Medicaid Issues Now.
The attorneys of The Health Law Firm represent health care providers in Medicare audits, ZPIC audits and RAC audits throughout Florida and across the U.S. They also represent physicians, medical groups, nursing homes, home health agencies, pharmacies, hospitals and other healthcare providers and institutions in Medicare and Medicaid investigations, audits, recovery actions and termination from the Medicare or Medicaid Program.

For more information please visit our website at www.TheHealthLawFirm.com or call (407) 331-6620 or (850) 439-1001.

Sources:

Nashville Business Journal. “Ambulance Company Sues Over $2.65M Bill.” Nashville Business Journal Online. (March 15, 2012). From: http://www.bizjournals.com/nashville/stories/2010/03/15/daily2.html

First Call Ambulance Service, Inc., v. Department of Health and Human Services, Case Number 3:10-0247, Order of Dismissal, May 25, 2012 available at: http://www.thehealthlawfirm.com/uploads/First%20Call_Dismissal.pdf

First Call Ambulance Service, Inc., v. Department of Health and Human Services, Case Number 3:10-cv-0247, First Call Ambulance Service, Inc., Sues Department of Health and Human Services Over $2.65 Million, March 20, 2010 available at: http://www.thehealthlawfirm.com/uploads/First%20Call%20Case.pdf

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone:  (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.

The RACs, They’re Back! The Return of Medicare Recovery Audits

Patricia's Photos 013By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

All good things must come to an end. This includes the two-month hiatus from Recovery Audit Contractors (RACs) that healthcare professionals enjoyed. The Centers for Medicare and Medicaid Services (CMS) is restarting audits of Medicare fee-for-service claims on a limited basis. The program has been suspended since June 1, 2014, due to expired contracts.

CMS announced the return of RACs on August 4, 2014.

Click here to read the latest announcements on Medicare recovery audits from CMS.

From what we have heard, there were serious problems with some of the audits that had been conducted by the RACs and CMS desired to start over with a clean slate. Just saying!

What Does Limited Basis Mean?

According to CMS, current RACs will conduct a limited number of automated reviews and a small number of complex reviews on certain claims including, but not limited to:

– Spinal fusions;
– Outpatient therapy services;
– Durable medical equipment;
– Prosthetics;
– Orthotics; and
– Supplies and cosmetic procedures.

RACs will not conduct any inpatient hospital patient status reviews for now. In the past, short inpatient stays accounted for 91 percent of the money the program recovered for Medicare.

Controversial Program.

According to an article on HealthData Management, in February 2014, members of congress argued that parts of the RAC program are unfair and violate the way that the Medicare program was intended to operate by raising out-of-pocket costs for beneficiaries. To address this concern, CMS established a provider relations coordinator to increase program transparency. This was announced in June 2014, so it is too soon to determine if this position will help providers affected by the medical review process. Click here to read more from HealthData Management.

Healthcare providers have complained that they are fed up with Medicare recovery audits tying up crucial funds and physician time in endless appeals. Currently, appeals can take up to five years. There is also a two-year moratorium in place preventing new appeals from being filed. You may remember my previous blog on the enormous backlog of Medicare recovery audit appeals. Click here to read that post.

What Exactly is a RAC?

RACs are often referred to as “bounty hunters.” They are private companies contracted by CMS, used to identify Medicare overpayments and underpayments, and return Medicare overpayments to the Medicare Trust Fund. Since the program began in 2009, it has brought in more than $8 billion in allegedly fraudulent, wasteful and abusive payments to healthcare providers.

How to Prepare for a Medicare Recovery Audit.

There is no such thing as a routine Medicare audit. The fact is that there is some item you have claimed as a Medicare provider or the amount of claims Medicare has paid in a certain category that has caused you or your practice to be audited.

I previously wrote a blog highlighting some of the actions we recommend you take in responding to a Medicare audit. The most important step you should take is to consult an experienced health law attorney early in the audit process to assist in preparing the response. Click here to read more on how to respond to a Medicare audit.

We Told You RACs Would Be Back.

RACs apparently caught $3.7 billion in allegedly wasteful payments that Medicare made to healthcare providers in 2013, and was allegedly on pace to bring back $5 billion this year. That’s why the government was eager to get RACs back to work.

It is extremely common for state and federal regulators to enforce even the smallest violations, resulting in investigations, monetary fines and penalties. If found in violation, you will not only have to pay fines and face disciplinary action, you will also lose revenue because you will have to spend time dealing with the investigation, instead of practicing medicine. Whether you are trying to prevent Medicare and Medicaid audits, Zone Program Integrity Contractor (ZPIC) audits, or any other kind of healthcare audits, there are steps you can implement in your practice today that may save you down the line. Click here to read more on self audits.

Comments?

What do you think about the return of Medicare recovery audits? What are you thoughts on Recovery Audit Contractors? Please leave any thoughtful comments below.

Don’t Wait Until It’s Too Late; Consult with a Health Law Attorney Experienced in Medicare and Medicaid Issues Now.

The attorneys of The Health Law Firm represent healthcare providers in Medicare audits, ZPIC audits and RAC audits throughout Florida and across the U.S. They also represent physicians, medical groups, nursing homes, home health agencies, pharmacies, hospitals and other healthcare providers and institutions in Medicare and Medicaid investigations, audits, recovery actions and termination from the Medicare or Medicaid Program.

For more information please visit our website at www.TheHealthLawFirm.com or call (407) 331-6620 or (850) 439-1001.

Sources:

Demko, Paul. “Controversial Medicare Recovery Audits Make Limited Return.” Modern Healthcare. (August 5, 2014). From: http://www.modernhealthcare.com/article/20140805/NEWS/308059962/controversial-medicare-recovery-audits-make-limited-return

Goedert, Joseph. “CMS Restarts Parts of the RAC Program.” HealthData Management. (August 5,2014). From: http://www.healthdatamanagement.com/news/CMS-Restarts-Parts-of-the-RAC-Program-48553-1.html

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 1996-2014 The Health Law Firm. All rights reserved.

Revised Readmission Penalties are Coming Due to Calculation Errors

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

Back in August of 2012, I wrote that lower Medicare reimbursement rates were coming to more than 2,000 hospitals around the country due to excessive readmission rates. To see that blog, click here.

In October of 2012, the Centers for Medicare and Medicaid Services (CMS) announced it has discovered errors in its initial calculations. This means, 1,422 hospitals with high readmission rates will lose slightly more money than first expected, according to Kaiser Health News.

Click here to read the entire article from Kaiser Health News.

Hiccup  in Medicare’s Hospital Readmission Reduction Program.

According to Kaiser Health News, the revisions were relatively small, averaging two-hundredths of a percent of a hospital’s regular Medicare reimbursements. Florala Memorial Hospital in Alabama will see the largest increase in its reimbursements, from 0.62 to 0.73 percent.

Originally, Medicare said it would base the penalties on the readmission rates for patients who were discharged from July 2008 through June 2011. According to a notice the CMS published, the mistake happened because the agency accidentally included claims before July 1, 2008, in its evaluations. Click here to see the notice from the CMS.

Program Initiated to Lower Hospitals’ Readmission Rates.

According to CMS, nearly one out of five Medicare patients will return to the hospital within a month of being discharged, these readmissions cost the government $17.5 billion in 2010. Medicare has estimated, with this program, it will recoup about $280 million from hospitals where too many patients return.

To see an updated list of hospital penalties, click here.

Don’t Wait Until It’s Too Late; Consult with a Health Law Attorney Experienced in Medicare and Medicaid Issues Now.

The attorneys of The Health Law Firm represent healthcare providers in Medicare audits, ZPIC audits and RAC audits throughout Florida and across the U.S. They also represent physicians, medical groups, nursing homes, home health agencies, pharmacies, hospitals and other healthcare providers and institutions in Medicare and Medicaid investigations, audits, recovery actions and termination from the Medicare or Medicaid Program.

For more information please visit our website at www.TheHealthLawFirm.com or call (407) 331-6620 or (850) 439-1001.

Comments?

What do you think about this story? Does this error by the CMS leave you jaded about the program? Leave any thoughtful comments below.


Sources:

Rau, Jordan. “Medicare Revises Hospitals’ Readmissions Penalties.” Kaiser Health News. (October 2, 2012). From: http://www.kaiserhealthnews.org/Stories/2012/October/03/medicare-revises-hospitals-readmissions-penalties.aspx

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone:  (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.

Apopka Woman to Serve 18-Month Prison Sentence After $47K Medicaid Scam

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

IndestAn Apopka businesswoman was recently sentenced to 18 months in prison after she was found guilty of a Medicaid scam. According to the Florida Attorney General’s Office, Shanqual Marshall-Gunn was arrested in September on suspicion of submitting more than $47,000 in fraudulent Medicaid claims.

Company Provided Targeted Case Management Services (TCMs).

Marshall-Gunn owned Second Chances TCM, Inc. TCMs are intended to provide Medicaid recipients who have mental-health disorders with connections to resources in their community, and to assist them in leading a more normal life. Prosecutors said Marshall-Gunn gave employees and clients kickbacks when they submitted referrals to her company.

Three of her employees were also arrested in September 2014 for billing Medicaid for targeted case management services that were fraudulent or not authorized.

Marshall-Gunn Entered a No Contest Plea.

Media reported that court records show Marshall-Gunn entered a no contest (or “nolo contendere”) plea and was found guilty of Medicare fraud, a second-degree felony. Circuit Court Judge Jenifer Davis sentenced Marshall-Gunn on July 2. Davis also ordered Marshall-Gunn to serve five years of probation.

In addition, she cannot work for any Medicaid provider and must pay more than $47,000 in restitution.

The Investigation Was Conducted by the Medicaid Fraud Control Unit.

The investigation was conducted by Attorney General Pam Bondi’s Medicaid Fraud Control Unit (MFCU). And it was prosecuted by the Attorney General’s Office of Statewide Prosecution.

Bondi’s MFCU investigates and prosecutes providers that intentionally defraud Florida’s Medicaid program. According to Bondi’s MFCU press release in this case: “From January 2011 to August 2014, Attorney General Bondi’s MFCU has obtained more than $460 million in settlements and judgments.”

To read the press release, click here.

To read more about the MFCU, click here.

Comments?

Have you ever been a victim or suspect of Medicaid fraud? Please leave any thoughtful comments below.

Contact Health Law Attorneys Experienced in Handling Medicaid Audits, Investigations and other Legal Proceedings.

Medicaid fraud is a serious crime and is vigorously investigated by the state MFCU, the Agency for Health Care Administration (AHCA), the Zone Program Integrity Contractors (ZPICs), the FBI, the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (DHHS). Often other state and federal agencies, including the U.S. Postal Service (USPS), and other law enforcement agencies participate. Don’t wait until it’s too late. If you are concerned of any possible violations and would like a confidential consultation, contact a qualified health attorney familiar with medical billing and audits today. Often Medicaid fraud criminal charges arise out of routine Medicaid audits, probe audits, or patient complaints.

The Health Law Firm’s attorneys routinely represent physicians, dentists, orthodontists, medical groups, clinics, pharmacies, assisted living facilities (ALFs), home health care agencies, nursing homes, group homes and other healthcare providers in Medicaid and Medicare investigations, audits and recovery actions.

To contact The Health Law Firm, please call (407) 331-6620 and visit our website at www.TheHealthLawFirm.com.

Sources:

Attorney General’s Press Office. “Four Central Florida Residents Arrested for Medicaid Fraud.” (Sept. 5, 2014). WCTV. From: http://www.wctv.tv/home/headlines/Four-Central-Florida-Residents-Arrested-for-Medicaid-Fraud-274154191.html

Connolly, Kevin P. “Apopka woman sentenced to prison for 18 months after Medicaid scam.” Orlando Sentinel. Print.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

KeyWords: Medicaid, Medicaid fraud, defense attorney, Medicaid investigation, defense lawyer, defense counsel, Medicaid claims, fraudulent claims, home health care, criminal defense, health law criminal defense, health law criminal representation, criminal representation, Medicaid Fraud Control Unit, MFCU, targeted case management provider, TCM, Florida’s Medicaid program, overbill Medicaid, Medicaid scam, Medicaid fraud defense attorney, Medicaid fraud defense lawyer, Medicare, Medicare fraud, Medicare Investigation, overbill Medicare, health care fraud, Florida Attorney General, The Health Law Firm

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 1996-2015 The Health Law firm. All rights reserved.

South Florida Pharmacy Owner Pleads Guilty to $23 Million Health Care Fraud Scheme

00011_RT8By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

A co-owner and operator of three Miami-area pharmacies pleaded guilty on December 6, 2012, for his part in a $23 million health care fraud scheme. The pharmacy owner allegedly admitted in the Florida Southern Federal District Court to one count of conspiracy to commit health care fraud and one count of conspiracy to pay illegal health care kickbacks, according to a Department of Justice (DOJ) press release.

Click here to read the entire press release from the DOJ.

Pharmacy Owner Used Kickbacks and Referrals to Allegedly Scam Medicare and Medicaid.

According to court documents, the pharmacy owner allegedly admitted to paying illegal kickbacks to an unnamed number of co-conspirators in return for Medicare and Medicaid beneficiary information. That information was then used to submit fraudulent claims. A majority of the beneficiaries referred to the owner’s pharmacies reportedly resided at assisted living facilities (ALFs) in Miami.

The court documents state that the pharmacy owner also allegedly paid kickbacks to physicians in exchange for prescription referrals which were also billed to Medicare.

Unused and Partially Used Medicine Part of Scheme.

As part of the scheme, the pharmacy owner allegedly instructed drivers working for his pharmacies to pick up unused medications from ALFs around Miami. The medications were then allegedly placed back into pill bottles. Unused and partially used medications were billed back to Medicare and Medicaid, according to court documents.

Click here to read the court documents on this case.

The pharmacy owner and his co-conspirators allegedly submitted more than $23 million in false and fraudulent claims to Medicare and Florida Medicaid programs.

Don’t Wait Until It’s Too Late; Consult with a Health Law Attorney Experienced in Medicare and Medicaid Issues Now.

The attorneys of The Health Law Firm represent healthcare providers in Medicare audits, ZPIC audits and RAC audits throughout Florida and across the U.S. They also represent physicians, medical groups, nursing homes, home health agencies, pharmacies, hospitals and other healthcare providers and institutions in Medicare and Medicaid investigations, audits, recovery actions and termination from the Medicare or Medicaid Program.

For more information please visit our website at www.TheHealthLawFirm.com or call (407) 331-6620 or (850) 439-1001.

Comments?

What do you think of this case? Is the Miami area just a hotbed for Medicare and Medicaid schemes? Please leave any thoughtful comment below.

Sources:

United States of America v. Jose Carlos Morales. Case Number 12-23374, Preliminary Injunction and Supporting Memorandum of Law. (September 14, 2012). From: http://www.thehealthlawfirm.com/uploads/USA%20v%20Morales.pdf

Department of Justice. “Pharmacy Owner Pleads Guilty in Miami for Role in $23 Million Health Care Fraud Scheme.” Department of Justice . (December 6, 2012). From: http://www.justice.gov/opa/pr/2012/December/12-crm-1461.html

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone:  (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.

Specialty Pharmacy Agrees to Pay A $11.4 Million Settlement in Whistleblower Case

Lance Leider headshotBy Lance O. Leider, J.D., and George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

The Department of Justice (DOJ) announced on December 27, 2012, that a specialty pharmacy, based in San Diego, California, has agreed to pay a $11.4 million settlement. That payment is to resolve allegations that the company used kickbacks to persuade doctors to write prescription for its products. The allegations came from a whistleblower lawsuit filed by a former employee.

Click here to read the press release from the DOJ.

Specialty Pharmacy Allegedly Used Expensive Kickbacks to Bribe Doctors.

An article in Modern Healthcare states that the specialty pharmacy allegedly used tickets to sporting events, concerts, plays, spa outings, golf games and ski trips to bribe doctors to write prescriptions for its products. The company also had representatives schedule paid “preceptorships,” where the reps would follow doctors in their offices in an attempt to increase prescriptions written for their products.

To read the Modern Healthcare article, click here.

Specialty Pharmacy Will Pay More Than $11 Million.

The specialty pharmacy company agreed to a forfeiture of $1.4 million to resolve the anti-kickback statue allegations. It will also pay $9.9 million to resolve false claims allegations, according to the DOJ. Representatives with the DOJ said that by entering the deferred prosecution agreement the company was able to avoid criminal and civil liability for the kickback and false claims violations.

Whistleblower Gets $1.7 Million Reward.

According to the DOJ, the settlement resolves a False Claims Act lawsuit that was filed by a former sales representative for the specialty pharmacy. As part of the resolution, that whistleblower will receive $1.7 million.

Whistleblowers stand to gain substantial amounts, sometimes as much as thirty percent (30%), of the amount the government recovers under the False Claims Act (31 U.S.C. Sect. 3730). Such awards encourage employees and contractors to come forward and report fraud. You can learn more on the False Claims Act on the DOJ website.

Contact Health Law Attorneys Experienced with Qui Tam or Whistleblower Cases.

Attorneys with The Health Law Firm also represent health care professionals and health facilities in qui tam or whistleblower cases. We have developed relationships with recognized experts in health care accounting, health care financing, utilization review, medical review, filling, coding, and other services that assist us in such matters.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Comments?

What do you think of the settlement agreement? As a health professional are you tempted with kickbacks? Please leave any thoughtful comments below.

Sources:

Department of Justice. “Victory Pharma Inc. of San Diego Pays $11.4 Million to Resolve Kickback Allegations in Connection with Promotion of Its Drugs.” Department of Justice. (December 27, 2012). From: http://www.justice.gov/opa/pr/2012/December/12-civ-1547.html

Kutscher, Beth. “$11.4 Million Settlement in Pharma Kickback Case.” Modern Healthcare. (December 27, 2012). From: http://www.modernhealthcare.com/article/20121227/NEWS/312279957/

About the Authors: Lance O. Leider is an attorney with The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Avenue, Altamonte Springs, Florida 32714, Phone:  (407) 331-6620.

George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

 

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.

Copyright © 1996-2012 The Health Law Firm. All rights reserved.

Major Medicare Offender Sentenced to Prison for Multi-Million Dollar Health Care Fraud Scheme

Lance Leider headshotBy Lance O. Leider, J.D., The Health Law Firm

The former owner of four mental health facilities in South Florida and North Carolina was sentenced to fourteen (14) years in federal prison on February 25, 2013. The former business owner pleaded guilty to defrauding Medicare out of tens of millions of dollars from 2004 through 2011, according to the Department of Justice (DOJ). He had previously been convicted of cocaine trafficking but decided to move to Medicare fraud supposedly because he thought it would be safer. In total the former mental health facility owner was indicted for defrauding the government of nearly $63 million. As part of his plea, he was ordered to repay $28 million.

Click here to read the press release from the DOJ.

Unnecessary Services, Illegal Kickbacks and Fake Mental Health Records.

The scheme, headed by the former business owner, involved three mental health clinics in Miami, Florida, and one in Hendersonville, North Carolina. All four facilities allegedly billed Medicare and Medicaid for services that were unnecessary or otherwise not provided. The clinics also paid bribes to local assisted living facilities (ALFs) in order to provide a steady stream of patients that were in no need of services. Employees of the clinic would then fabricate entire mental health records for the patients in order to bill the government programs. The former mental health facility owner and his employees allegedly thought that creating the medical records would aid them in avoiding detection by federal auditors, according to an article in the Miami Herald.

To read the Miami Herald article, click here.

Co-Conspirators Feeling the “Heat.”

Fifteen (15) of the former business owner’s co-conspirators have been charged for their alleged roles in the health care fraud scheme. Ten (10) defendants have already pleaded guilty, according to the DOJ.

This case was investigated by the Federal Bureau of Investigation (FBI), the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) and the Medicare Fraud Strike Force. These departments help make up the Health Care Fraud Prevention and Enforcement Action Team (HEAT) that works to stop Medicare fraud across the country.

Don’t Wait Until It’s Too Late; Consult with a Health Law Attorney Experienced in Medicare and Medicaid Issues Now.

The attorneys of The Health Law Firm represent healthcare providers in Medicare audits, ZPIC audits and RAC audits throughout Florida and across the U.S. They also represent physicians, medical groups, nursing homes, home health agencies, pharmacies, hospitals and other healthcare providers and institutions in Medicare and Medicaid investigations, audits, recovery actions and termination from the Medicare or Medicaid Program.

For more information please visit our website at www.TheHealthLawFirm.com or call (407) 331-6620 or (850) 439-1001.

Comments?

What do you think of the former business owner’s sentence? Do you think it is enough to deter other would-be criminals from scamming the government? Please leave any thoughtful comments below.

Sources:

Weaver, Jay. “Miami Businessman Who Stole Millions from Medicare Sentenced to 14 Year.” Miami Herald. (February 26, 2013). From: http://www.miamiherald.com/2013/02/26/3254507/miami-businessman-who-pleaded.html

Department of Justice. “Owner of Mental Health Facilities Sentenced to 168 Months in Prison in Connection with $63 Million Health Care Fraud Scheme.” Department of Justice. (February 25, 2013). From: http://www.justice.gov/opa/pr/2013/February/13-crm-234.html

About the Author: Lance O. Leider is an attorney with The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Avenue, Altamonte Springs, Florida 32714, Phone: (407) 331-6620.

The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 1996-2012 The Health Law Firm. All rights reserved.

Tips for Responding to a Medicaid Audit

6 Indest-2008-3By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

Should you find yourself, your facility or your health practice the subject of a Medicaid audit by your state Medicaid agency or audit contractor, there are a few things you should know.

The most important thing is that just because you are being audited, it does not mean that you or your business has done anything wrong. State and federal governments conduct audits for many different reasons. Typical reasons include: special audits of high-fraud geographic areas, auditing of particular billing codes, randomly selected provider auditing, and complaints of possible fraud.

Medicaid Audits in Florida.

The Agency for Health Care Administration (AHCA), Office of Inspector General (OIG) and Bureau of Medicaid Program Integrity are the Florida agencies responsible for routine audits of Medicaid health care providers to ensure that the Medicaid Program was properly billed for services. Health care professionals receiving the greatest amounts of Medicaid payments are also the ones most likely to be audited. These include pediatricians, Ob/Gyns, family practice physicians and dentists. The Medicaid audit usually requests information in a questionnaire that the medical practice is required to complete, as well as a request for copies of medical records (including x-rays and other diagnostic studies) on the list of Medicaid patients selected for the audit.

If AHCA determines that Medicaid overpaid for services, it will use a complex mathematical extrapolation formula to determine the repayment amount. The amount of the repayment to the Medicaid Program can be considerably greater than (30 to 100 times as much as) the actual amount of overpayment disclosed by the sample of records audited. Additionally, fines and penalties can be added by the Medicaid Program. However, you can eliminate or reduce the amount of any such repayment by actions taken both before and during the Medicaid audit.

How to Know If You Are the Subject of an Audit.

An audit will usually begin with the provider receiving an initial audit request, usually by letter or fax. This request will serve to notify the recipient that it is the subject of an audit. The initial letter will not always identify the reason for the audit. What it will contain, however, is a list of names and dates of service for which the auditors want to see copies of medical records and other documentation.

This stage of the process is crucial because it is the best opportunity to control the process. Once the records are compiled and sent to the auditor, the process shifts and you are now going to have to dispute the auditor’s findings in order to avoid a finding of overpayment.

The biggest mistake that someone who is the subject of an audit can make is to hastily copy only a portion of the available records and send them off for review. The temptation is to think that since the records make sense to you, they will make sense to the auditor. Remember, the auditor has never worked in your office and has no idea how the records are compiled and organized. This is why it is so important to compile a thorough set of records that are presented in a clearly labeled and organized fashion that provides justification for every service or item billed.

Read the Audit Letter Carefully.

On top of the letter notifying you of the audit, AHCA will also supply you with a list of patients to be sampled. A standard sample will include a list of anywhere from 30 to 150 patient names, depending on the size of the practice. Regular audits routinely request 30 to 50 patient records. The audit letter will also include a questionnaire to be completed (Medicaid Provider Questionnaire) and a “Certification of Completeness of Records” form to complete and return with the copies of the patient records. (Please note: this will be used against you in the future if you attempt to add to or supplement the copies of the records you provided).

Compiling a Response to an Initial Audit Request.

The following are steps that you should take in order to compile and provide a set of records that will best serve to help you avoid any liability at the conclusion of the audit process:

1. Read the audit letter carefully and provide everything that it asks for. It’s always better to send too much documentation than too little.

2. If at all possible, compile the records yourself. If you can’t do this, have a compliance officer, experienced consultant or experienced health attorney compile the records and handle any follow-up requests.

3. Pay attention to the deadlines. If a deadline is approaching and the records are not going to be ready, contact the auditor and request an extension before it is due. Do this by telephone and follow up with a letter (not an e-mail). Send the letter before the deadline.

4. Send a cover letter with the requested documents and records explaining what is included and how it is organized as well as who to contact if the auditors have any questions.

5. Number every page of the records sent from the first page to the last page of documents.

6. Make a copy of everything you send exactly as it is sent. This way there are no valid questions later on whether a particular document was forwarded to the auditors.

7. Send the response package using some form of package tracking or delivery confirmation to arrive before the deadline.

Compiling all of the necessary documentation in a useful manner can be an arduous task. If you find that you cannot do it on your own, or that there are serious deficiencies in your record keeping, it is recommended that you reach out to an attorney with experience in Medicaid auditing to assist you in the process.

Contact Health Law Attorneys Experienced in Handling Medicaid and Medicare Audits.

The Health Law Firm’s attorneys routinely represent physicians, medical groups, clinics, pharmacies, durable medical equipment (DME) suppliers, home health agencies, nursing homes and other healthcare providers in Medicaid and Medicare investigations, audits and recovery actions.
To contact The Health Law Firm please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

Comments?

Have you ever been the subject of a Medicaid audit? What was the process like? Please leave any thoughtful comments below.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 1996-2012 The Health Law Firm. All rights reserved.

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