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Former Tenet Exec Charged in $400M Healthcare Fraud Scheme

Recent healthcare fraud schemes and settlements involved kickbacks for patient referrals as well as claims submitted for unnecessary services and substandard care.

DoJ charged a former Tenet healthcare executive for his alleged participation in a healthcare fraud scheme totaling $400 million

Source: Thinkstock

- The Department of Justice (DoJ) recently announced the indictment of Tenet Healthcare Corporation’s former senior vice president of operations for his alleged participation in a healthcare fraud scheme totaling over $400 million in inappropriate payments.

During his time as an executive at Tenet Healthcare’s Southern States Region and as the CEO at Georgia-based North Fulton Medical Center, John Holland reportedly bribed other healthcare organizations and paid kickbacks for patient referrals to his facilities.

From 2007 to 2013, Holland also engaged in an alleged Medicaid fraud scheme at Tenet Healthcare’s affiliated medical billing center in Florida. The former executive is charged with covering up a scheme to evade internal accounting controls and alter the healthcare corporation’s records and reports.

Resulting from the schemes, Tenet healthcare fraudulently billed Medicaid programs in Georgia and South Carolina for over $400 million. The healthcare corporation also received more than $149 million in Medicaid and Medicare reimbursements based on patient referrals from bribes and kickbacks.

In addition, the DoJ reported that Holland helped Tenet Healthcare violate it’s 2006 corporate integrity agreement with the Office of the Inspector General (OIG). He falsely stated that the healthcare corporation followed federal healthcare program participation requirements and the agreement’s terms.

Tenet Healthcare did not face termination from Medicaid and Medicare because of Holland’s false statements. Consequently, the healthcare corporation received upwards of $10 billion in federal healthcare payments it would not have received if the company had been terminated from the programs.

The former executive received one count of mail fraud, one count of healthcare fraud, and two counts of major fraud against the US.

Affiliated healthcare organizations, including North Fulton Medical Center and Tenet’s HealthSystem Medical Inc. are also working with the DoJ to resolve reported healthcare fraud schemes. Although, Tenet Healthcare entered a non-prosecution agreement, acquired an independent compliance monitor, and agreed to pay $513 million to resolve healthcare fraud charges.

Pain management provider in Kentucky to pay $20 million for healthcare fraud scheme

The DoJ also announced that a pain management provider from Kentucky consented to pay $20 million to resolve healthcare fraud allegations stemming from two schemes.

First, Robert Windsor, MD, reportedly submitted false claims between 2008 and 2013 to Medicare, TRICARE, and the Federal Employees Health Benefits Program. The claims showed that Windsor participated in online, real-time intraoperative surgery monitoring, but the pain management provider did not actually personally observe the surgeries.

Instead, he directed a medical assistant to monitor the surgeries despite a claim reimbursement requirement that a physician perform the task.

In October 2016, Windsor received three years and two months of jailtime followed by three years of supervised release for his participation in the healthcare fraud scheme.

Secondly, the DoJ also accused the pain management provider of submitting claims to federal healthcare programs for medically unnecessary services. Between 2010 and 2014, Windsor reportedly conducted inappropriate balance tests, nerve conductions, electromyography services, and qualitative drug screenings.

“Providing medically unnecessary services to a vulnerable population, such as Medicare beneficiaries, places patients at risk and jeopardizes millions of taxpayer dollars,” stated Derrick Jackson, OIG Special Agent. “HHS-OIG is committed to safeguarding the federal healthcare programs and the patients receiving medical services. Today’s settlement should send a message to others who profit from schemes abusing patient safety that we will pursue justice for our beneficiaries and the programs.”

Florida-based urologist charged with ordering unnecessary tests for financial gain

A Fort Myers-area urologist agreed to pay more than $3.8 million to the government after alleged False Claims Act violations stemming from unnecessary medical testing, the DoJ reported.

When Meir Daller, MD, was employed by Gulfstream Urology, a 21st Century Oncology LLC division, he reportedly billed Medicare and Tricare programs for unnecessary fluorescence in situ hybridization (FISH) tests. The laboratory test assesses a patient’s urine for genetic abnormalities that can lead to bladder cancer.

FISH tests are generally only considered necessary by Medicare if the patient already had bladder cancer or a provider believes a patient with blood in his urine might have bladder cancer.

Daller started to refer all FISH testing for his patients to a 21st Century laboratory and the company paid financial bonuses to the urologist based on the number of FISH test referrals. He ordered over 13,000 different FISH tests for his Medicare patients, causing him to become the top referring FISH test provider in the country.

He also received about $2 million in financial bonuses from 21st Century for his referrals to their laboratories.

In addition to paying millions to the government, Daller also agreed to a three-year integrity agreement from the OIG. The agreement mandates that the urologist undergo claim and EHR reviews by an independent review organization to ensure services are medically necessary and patient records are accurate.

21st Century will also pay $19.75 million to the government for similar healthcare fraud schemes.

Iowa nursing facility leaders agree to $100k settlement for substandard care

Leaders at Abbey of Le Mars, Inc. agreed to pay $100,000 to settle reported False Claims Act violations after investigators uncovered “grossly substandard” care at the nursing facility in Iowa.

The DoJ reported that nursing facility providers failed to perform quality care for 16 residents between January 2009 and February 2015. The nursing facility allegedly provided the following substandard care:

• Failure to manage skin conditions and fractures, resulting in low-quality care and added healthcare costs

• Excessive use of physical restraints and inappropriate medications

• Anti-psychotic drug use to reduce a resident needs

• Lacking nourishment, bathing, and toileting care, causing infections, impactions, and avoidable emergency room visits

Stemming from the low-quality care provided, the DoJ charged five of Abbey of Le Mars leaders, including its president and former director of nursing, for submitting Medicaid claims for services that were “worthless and effectively without value.”

The DoJ added that the Medicaid fraud case in Iowa was part of the larger Elder Abuse Initiative, launched in March 2016. Ten districts established regional Elder Justice Task Forces to further protect seniors and ensure that federal healthcare payments are not misspent.

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