October 30: Week That Was in Healthcare Fraud and Malpractice

October 30, 2015 - 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. The crimes reported below result in multiple millions of dollars in healthcare fraud and the possibility of extensive prison time.

NY medical clinic owner pleads guilty in $55M fraud scheme

Valentina Kovalienko, the owner of a pair of Brooklyn-based medical clinics, pleaded guilty this week for her involvement in a massive $55 million money laundering healthcare fraud scheme connected to illegal kickbacks.

Kovalienko, whose sentencing date is yet to be scheduled, agreed to forfeit over $29 million. She admitted such money can be directly traced to her criminal behavior. 

Over a four-year period beginning in 2008, Kovalienko’s actions resulted in patients being paid cash kickbacks involving medically unnecessary physical and occupational therapy, diagnostic tests, and office visits not performed by licensed professionals, says the OIG.

Kovalienko additionally admitted paying occupational and physical therapists to mispresent patient charts and billing records and diverting Medicare and Medicaid funds to herself and co-conspirators.  

Healthcare fraud costs tens of billions of dollars annually, says the Department of Justice. Law enforcement efforts are a major aspect of healthcare fraud prevention, the organization adds.

“Some estimates put the figure close to $100 billion a year.  It is a rising threat, with national health care expenditures estimated to exceed $3 trillion in 2014,” says the Department of Justice. “Health care fraud schemes continue to grow in complexity and seriousness.”

Highlights of biggest healthcare fraud cases of 2015 so far

It appears to be a relatively quiet week, at least according to the OIG and the Department of Justice, in terms of late October fraud cases. Nonetheless, here is a condensed version of some of the most expensive healthcare fraud and malpractice cases reported by RevCycleIntelligence.com throughout the course of 2015 thus far.

• $256 million: Millennium Health allegedly caused physicians to order excessive tests and additionally took part in physician kickbacks in one of the biggest false claim submission acts of the year.
• $158 million: Patients watched films but received no medical treatment from Devotions Care Solutions, a satellite psychiatric facility of Riverside General Hospital. Three individuals were sentenced to a combined total of over 7 decades in prison. Six others pleaded guilty to involvement in this massive scheme.
• $115 million: Adventist Health System – a non-profit healthcare organization operating among 10 states – settled False Claims Act allegations to resolve allegations involving physician bonuses for inappropriate referrals.
• $69.5 million: The North Breward Hospital District settled to pay this sizable amount after allegedly violating the False Claims Act and the Stark Statute.
• $63 million: Roger Rousseau, former Medical Director of the currently non-operational Health Care Solutions Network Inc, (HCSN), and three therapists were found guilty of involvement in a healthcare fraud scheme involving intensive care treatments for the mentally ill. HCSN submitted more than $63 million in false and fraudulent Medicare and Medicaid claims.

Efforts to combat the aforementioned cases have been actively underway this year. As RevCycleIntelligence.com additionally reported, Sylvia M. Burwell, Secretary of the Department of Health and Human Services, announced a $712 million false billing sweep across 17 districts where nearly 250 individuals ended up facing healthcare fraud and malpractice charges.