Policy & Regulation News

July 17: Week That Was in Healthcare Fraud and Malpractice

By Jacqueline DiChiara

- 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.

healthcare scheme

Medically unnecessary Chemotherapy gets physician 45 years

Prosecutors pushed this week and last for Farid Fata, MD, to serve over 175 years behind bars for telling healthy patients they had cancer and administering chemotherapy drugs to them. Hermatologist-oncologist Fata administered medically unnecessary infusions or injections to over 550 patients in a healthcare scheme associated with $34 million in fraudulent claims to Medicare. Fata will serve 45 years in prison and will forfeit over $17 million.

“Rather than use his medical degree to save lives, Dr. Fata instead destroyed them in pursuit of profit,” states Assistant Attorney General Leslie R. Caldwell.  “Time and again, Dr. Fata callously violated his patients' trust as he used false cancer diagnoses and unwarranted and dangerous treatments as tools to steal millions of dollars from Medicare, even stooping to profit from the last days of some patients' lives.  While no sentence can restore what was taken from his patients and their families, the sentence imposed ensures that never again will Dr. Fata lay hands on another patient,” Caldwell says.

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  • Says US Attorney Barbara L. McQuade of the Eastern District of Michigan, “Dr. Fata did not care for patients; he exploited them as commodities. He over-treated, under-treated and outright lied to patients about whether they had cancer so that he could maximize his own profits.”

    “This is the most egregious case of fraud and deception that I have seen in my career," adds Chief Richard Weber of the Internal Revenue Service – Criminal Investigation (IRS-CI).  “This disgusting and diabolical scheme has hurt hundreds of patients and their families and stolen from them something that no punishment from the court can do to make them whole,” he says.

    Missouri cancer patients receive misbranded drugs

    Oncologist Robert L. Carter, MD, was sentenced this week in federal court to 5 years of probation for dispensing “foreign, misbranded drugs” to cancer patients. Joplin, Missouri-based Carter will pay over $971,000 in restitution and a criminal forfeiture judgement of $1.2 million. Via Carter’s plea agreement, he must stop practicing medicine within the state until the probation period ends.

    Carter, who pleaded guilty last March to both buying and selling FDA-unapproved misbranded prescription drugs, was president and medical practitioner, caring for patients with cancer and blood diseases. Medicare and Medicaid reimbursed Carter for prescription drugs and chemotherapy drugs purchased in Winnipeg, Manitoba, Canada, later dispensed through his practice. Some drugs had labeling in multiple languages and lacked the “Rx only” symbol.

    CT Physician pays $270K in False Claims Act settlement

    This week, osteopathic physician, David Lester Johnston, MD, was sentenced to 3 months of imprisonment and 3 years of supervised release, and community service for committing healthcare fraud.

    Johnston pleaded guilty last January to healthcare fraud and defrauding private health insurance companies by misrepresenting claims and claiming false services were performed. According to an investigation, Johnson was out of the country when he claimed he had rendered various massage services.

    Johnson will pay restitution of over $172,000 and will pay over $270,000 to settle federal civil claims regarding false Medicare claims, as Medicare does not categorize massage therapists as providers with Medicare eligibility. Johnson will not be able to participate in federal healthcare programs for several years, according to the civil settlement.