December 4: Week That Was in Healthcare Fraud and Malpractice
“Patients and taxpayers deserve better, and those who would defraud the system should expect to pay for their schemes.”
By - Here is a general roundup of the past week’s developments in healthcare fraud and malpractice, as reported by the Department of Justice and the Office of Inspector General (OIG). The crimes reported below result in multiple millions of dollars in healthcare fraud and the possibility of extensive prison time.
Improper financial relations lead to $500K payment
This week, Piedmont Pathology Associates, Inc. and Piedmont Pathology P.C. – based in North Carolina – agreed to pay $500,000 involving violation of the False Claims Act.
The cases, prompted by a whistleblower who was a former contract salesperson within the practice, involve improper financial relationships with referring physicians, according to the Department of Justice.
Piedmont Pathology provided Electronic Medical Record (EMR) software licenses to 9 physician practices for free or at a very low cost. These licenses were administered right around the time when the physician practices began participating in referral contracts, confirmed the Department of Justice.
“This conduct violated the Anti-Kickback Statute. Claims submitted in violation of the Anti-Kickback Statute are considered tainted and are per se violations of the False Claims Act,” reported the Department of Justice.
“Combatting fraud against the government is a priority in this office; and importantly, holding accountable health care providers who have improper financial relationships with referral sources has been a focus,” stated Bill Nettles, United States District Attorney for the District of South Carolina.
“Financial relationships between physicians for referrals can alter a physicians’ judgment as to what’s necessary and appropriate for a patient. Our goal in this settlement was not only to recover money for improper healthcare claims, but to deter similar conduct and, in turn, promote health care affordability.”
“Paying for referrals, as the government alleged, is little more than a thinly veiled bribe,” asserted Derrick Jackson, Special Agent in Charge with the Office of Inspector General, Department of Health and Human Services (HHS). “Patients and taxpayers deserve better, and those who would defraud the system should expect to pay for their schemes.”
Regent Management to pay $3M for ambulance swapping
Regent Management Services L.P. – a skilled nursing facility with nearly a dozen owned and operated facilities across Texas and Nevada – has agreed to pay over $3 million in a rare settlement involving ambulance “swapping” arrangements.
Regent patients allegedly received free or very inexpensive ambulance transports from various ambulance companies in exchange for referrals. Said the Department of Justice, Regent essentially dodged financial accountability through its actions.
“Swapping arrangements continue to be an area of concern throughout the ambulance industry,” said CJ Porter, Special Agent in Charge at HHS-OIG.
“Such improper arrangements among providers have the potential to negatively affect patient care and need to be aggressively pursued in order to protect the integrity of the federal health care programs and their beneficiaries.”
The state of Texas will reportedly receive over $500,000 of the settlement amount. Additionally, Regent has been instructed to carry out internal compliance reforms over the next 5 years, as per a corporate integrity agreement (CIA) with HHS-OIG.
“This settlement sends a message to the health care industry that both sides of a swapping arrangement can be held responsible for their improper actions, not just the entity that actually bills Medicare or Medicaid for the services,” said Gregory Demske, Chief Counsel to the Inspector General at HHS-OIG.
“Any company or individual considering entering such schemes should understand that their actions may have serious legal and financial consequences.”
