May 8: Week That Was in Healthcare Fraud and Malpractice
By - Here is a general roundup of the past week’s developments in healthcare fraud and malpractice, as reported by the Department of Justice (DOJ) 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.
Five million oxycodone pills illegally distributed in NY
Kevin Lowe, owner and operator of “Astramed,” a pretend medical clinic and drug distribution ring operating throuhout Bronx, NY, has been convicted for illegally distributing five million oxycodone pills over a three-year period.
“As a jury unanimously found, Kevin Lowe operated a series of purported medical clinics that functioned as prescription pill drug trafficking dens,” states Attorney Preet Bharara.
Within these alleged clinics, physicians handled 35,000 medically pointless oxycodone prescriptions. The tablets’ street value was approximately $165 million, confirms Bharara.
Written oxycodone prescriptions have incredibly high value on the street, especially in the New York City area, confirms the DOJ report. One single prescription for 180 30-miligram pills can go for at least $6,000.
“With this guilty verdict and the 24 other convictions in this case, we have made an important step toward combatting the prescription pill trafficking problems plaguing the Southern District. I would like to thank the Drug Enforcement Administration and the New York City Police Department for being our partners in this case,” states Bharara.
Beneficiaries were charged $300 for very short “doctor visits” lasting only a couple of minutes. No physical examinations were performed and patients were not required to submit insurance information.
Lines were out the door of the clinic on a daily basis, the report confirms. Patients typically received large six 30-milligram oxycodone doses. “Virtually none of these individuals had any medical need for oxycodone, or any legitimate medical record documenting an ailment for which oxycodone would be prescribed,” confirms the report.
Lowe faces a maximum prison sentence of 20 years. Additionally, twenty-four individuals involved in the drug distribution ring have pled guilty thus far, including physicians, drug traffickers, and clinic employees.
$8M Nevada Medicare and Medicaid billing fraud scheme
Tonya Rushing, former CEO of the now closed Endoscopy Center of Southern Nevada, will serve one year and one day in prison for committing healthcare fraud. Rushing will also serve two years of supervised release, perform 150 hours of community service, and pay $60,000 in fines and restitution. Additionally, over $8 million will be paid via an order of forfeiture. Rushing conspired with the former owner of the center, Dipak Desai, to overcharge Medicare and Medicaid.
Both Rushing and Desai substantially exaggerated the amount of time certified registered nurse anesthetists spent with patients on various procedures. Rushing and Desai additionally demanded their office staff refer to fabricated anesthesia records when preparing reimbursement claims before sending them to Medicare and Medicaid.
“Those perpetrating Medicare and Medicaid fraud cheat both taxpayers and vulnerable patients,” maintains Attorney Daniel G. Bogden. “We will hold criminals accountable and will seek to recover stolen dollars in each case of healthcare fraud we prosecute.” Desai pleaded guilty last April to one count of conspiracy to commit healthcare fraud, and one count of healthcare fraud.
$5M settlement for violating anti-kickback using gift cards
The Physician Pharmacy Alliance (PPA) in North Carolina will pay $5 million for violating the Anti-kickback statute. PPA utilized an illegal strategy of awarding gift cards to garner Medicare and Medicaid patient referrals and regularly waiving Medicaid and Medicaid beneficiaries’ copayments.
“This case underscores for health care providers that if you commit fraud by giving gift cards or routinely waiving copayments in order to induce referrals, you will be liable for substantial damages and penalties under the Anti-kickback statute,” confirms Attorney Thomas G. Walker.
Via the implementation of the Anti-kickback statute, healthcare providers cannot legally offer such forms of compensation.
