Practice Management News

GA Provider Receives Jail Time for a Healthcare Fraud Scheme

While a Georgia-area provider received prison time for a healthcare fraud scheme, other recent fraud cases involved unnecessary services, fraudulent medical billing, and false claims.

By Jacqueline LaPointe

- A Georgia-area provider has recently been sentenced to three years and two months in prison stemming from a healthcare fraud case, the Department of Justice (DoJ) reported.

Recent healthcare fraud cases involved cases of fraudulent medical billing, false claims, and unnecessary medical services

Robert E. Windsor of Georgia was charged with fraudulent medical billing after he allegedly had an unqualified medical assistant monitor surgeries for him using Windsor’s credentials to make it seem as if Windsor was the monitoring physician.

Windsor was contracted by the Maryland-based American Neuromonitoring Associates to provide intra-operative monitoring to reduce adverse effects. The monitoring physician views the surgery online and communicates with surgeons in the operating room.

However, American Neuromonitoring Associates billed patients and payers for Windsor’s services even though he did not perform them. As a result, Windsor was reimbursed over $1.1 million by the company for monitoring he never performed.

DoJ discovered the healthcare fraud scheme through Medicare billing data analysis and several complaints to the Department of Human Services-Office of Inspector General (HHS-OIG) hotline.

In addition to prison time, a district court judge sentenced Windsor to three years of supervised release. He was also ordered to serve 200 hours of community service and repay over $1.1 million to health insurers.

“It is incomprehensible the lengths that some people will go to defraud our healthcare system,” stated George Crouch, Assistant Special Agent in Charge, FBI Atlanta. “But even more reprehensible is the willingness of healthcare providers like Dr. Windsor, to thoughtlessly put patients’ health at risk to profit from the system.”

Skilled nursing system pays $145 million to resolve Medicare fraud case

Life Care Centers of America Inc., a nationwide skilled nursing facility system, has agreed to pay $145 million to resolve a Medicare fraud case, representing the largest skilled nursing facility chain settlement in DoJ history, the federal department announced.

The settlement ends a Medicare fraud case stemming from false rehabilitation therapy claims between Jan. 1, 2006 and Feb. 28, 2013. Life Care Centers of America allegedly implemented corporate policies and practices that encouraged providers to place patients in the highest Medicare reimbursement level regardless of the patient’s clinical needs. Many beneficiaries received medically unnecessary and unreasonable services as a result.

Medicare reimburses skilled nursing facilities at a daily rate that considers the patient’s need for therapy and nursing services. If patients demonstrate more need, then Medicare reimbursement rates increase.

Life Care Centers of America reportedly tried to keep patients in care facilities longer than necessary to continue receiving Medicare reimbursement for services. The chain also monitored therapy minutes and days attributed to each patient to keep as many patients as possible at the highest Medicare reimbursement level for the longest possible period.

The Medicare fraud scheme was uncovered when former employees filed whistleblower lawsuits against the skilled nursing facilities chain. The whistleblowers will receive $29 million for their part in unveiling fraudulent behavior.

In addition to a fine, Life Care Centers of America will also enter into a five-year Corporate Integrity Agreement with HHS-OIG that will require the chain to undergo annual reviews by an independent organization. The auditors will look for medical necessity and appropriateness of therapy services billed to Medicare.

CA provider pleads guilty to $2.6 million Medicare fraud conspiracy

DoJ reported that a California-based licensed occupational therapist recently pleaded guilty in a $2.6 million Medicare fraud scheme. Keith Canlapan of California admitted that he billed Medicare for occupational therapy services that were never provided while he working at JH Physical Therapy.

Canlapan told the court that Medicare beneficiaries received massage and acupuncture services in lieu of occupational therapy, but these services were not reimbursable under Medicare. In other cases, Canlapan billed Medicare for services even though he was not present at JH Physical Therapy because he was out of the country or at his other jobs.

Through JH Physical Therapy, Canlapan billed Medicare for about $2.6 million in false and fraudulent claims, of which he was reimbursed $1.8 million.

The sentencing for Canlapan is expected to take place on Feb, 16, 2017.

Canlapan was also charged with Medicare fraud in June along with Simon Hong, JH Physical Therapy owner, and Grace Hong, JH Physical Therapy co-operator. The co-defendants were charged with one count of conspiracy to commit healthcare fraud and three counts of healthcare fraud. Their trial is scheduled for Jan. 17, 2017.

Another licensed occupational therapist, Roderick Belmonte Concepcion, also pled guilty as a co-conspirator in the Medicare fraud case. His sentencing is scheduled for Jan. 23, 2017.

Former state rep in MI receives probation for healthcare fraud

A district court recently sentenced Paul Nathan DeWeese, MD, former President and Chief Executive Officer of Michigan-based NBO Medical, to three years of probation for his participation in a healthcare fraud scheme involving false medical documents. He will also face a $5,000 fine.

The former state representative from 1998 to 2002 admitted to directing his administrative assistant and other employees to sign his name on electronic medical records for supervision services. DeWeese then sent the false claims to Blue Cross Blue Shield of Michigan for reimbursement even though the payer required physicians to supervise nerve block injections administered by nurse practitioners.

The investigation also uncovered that some of DeWeese’s signatures were signed in the medical record from electronic devices outside of the state and were not affiliated with NBO Medical.

The recent sentencing follows a March civil settlement involving DeWeese and NBO Medical. In that case, both entities agreed to pay over $270,000 to Medicare and Medicaid to resolve federal and state False Claims Act violations. DeWeese and NBO Medical reportedly failed to return Medicare and Medicaid overpayments for improperly billed electrical stimulation services and diagnostic vestibular tests as well as services performed by a non-physician practitioner.

Under the civil settlement resolution, DeWeese also paid a $15,000 fine and voluntarily gave up his Department of Drug Enforcement Administration (DEA) registration after related Controlled Substances Act violation accusations.

As part of a separate licensing case, DeWeese also permanently surrendered his medical license stemming from inappropriate controlled substance prescribing allegations.

In response, US Attorney Patrick Miles noted that his office sought jail time for DeWeese’s involvement in healthcare fraud schemes. DeWeese’s case qualified for a 24 to 30-month prison term under the advisory US Sentencing Guidelines.

Miles issued the following statement:

"When healthcare professionals engage in this type of conduct, they face civil fines, criminal restitution, suspensions and revocations of their licenses, and the possibility of imprisonment. As this case demonstrates, my office will aggressively use all available criminal, civil, and administrative remedies when it receives credible allegations of fraud and the improper prescribing of controlled substances. Document frauds in the healthcare field are particularly damaging because insurers rely on the accuracy and presume the authenticity of documents to assess the legitimacy of healthcare claims. As for improper prescribing of controlled substances, our opioid epidemic warrants the serious attention we give those allegations."

Dig Deeper:

Strong Compliance Programs Key to Avoiding Healthcare Fraud

Key Ways to Improve Claims Management and Reimbursement in the Healthcare Revenue Cycle