Healthcare fraud attributable to nurses, hospitals, pharmacists, equipment providers and doctors, contributes to the high cost of medical care. For this and other reasons, fraud continues to be a hot topic in the healthcare industry. Recently, there have been numerous headlines regarding Medicare, Medicaid, and private insurance company investigations of providers for improper billing practices. Accusations stem from both whistleblowers and audits, making it difficult for providers to hide behind fraudulent billing practices. With numerous investigations in the spotlight in recent months, providers should be alert and act to ensure that they are compliant with the law.
Legislation controlling self-referrals has created a complex road map that can leave doctors with questions regarding their ability to use business agreements to promote lab work and advanced imaging technology for their patients. For physicians, the rules and regulations of self-referrals for imaging can create headaches and lead to fines.
Georgia Physician Self-Referral and Fraud and Abuse Lawyers
Physician self-referrals may create conflicts of interest and can potentially result in violations of federal or state law. Previously, providers only had to worry about referrals for patients with federal insurance plans. However, the new legislative trend is expanding their liability. Physicians recently have been prosecuted for kickbacks involving patients with commercial insurance plans as well. If a physician’s referral is determined to be guided by profit and not the patient’s best interest, that referral could be violating the law.
This month, the abrupt closing of four Tennessee pain management clinics under investigation for state and federal health insurance fraud made headlines. Those clinics, formerly affiliated with PainMD and rebranded as Rinova, closed last week. Federal authorities alleged that PainMD and its parent company inflated profits by providing patients with unnecessary injections to be paid by federal health insurance programs. Authorities of the state of Tennessee initiated their own investigation, with concerns that the conduct of clinic personnel may violate state law.
Georgia Pain Management and DEA Defense Law Firm
In the PainMD pain clinic investigations, not only were the companies and clinic administrators at risk for financial penalties and reputational harm in connection with potential fraud, but so were the health providers who worked at those clinics. Three PainMD nurses were indicted on federal charges in connection with procedures provided at the Tennessee clinics under investigation.
The exposure and concern surrounding the opioid epidemic is at an all time high. Notwithstanding the urgency of the issue itself, this publicity places increased pressure on the intervening parties—sub-agencies of the Department of Health and Human Services, Department of Justice (DOJ) and state Attorney’s General—to implement regimens that make a difference. Our Georgia-based business and healthcare law firm follows developments that impact pain management physicians and medical practices.
At the Federal level, the DOJ is focused on taking steps to strategically intervene into physicians and pharmacies. Accordingly, the DOJ has expanded its enforcement to release a new tactic in the form of temporary restraining orders (TRO) against pharmacies that have violated the False Claims Act and the Controlled Substances Act. This tactic proved successful in a Tennessee District Court on January 13, 2019.
The highly anticipated “AseraCare” decision (United States v. GGSNC Admin. Serv. LLC) is still pending before the Eleventh Circuit Court of Appeals. The court is considering “whether a mere difference of opinion between physicians, without more, is enough to establish falsity under the False Claims Act.” To provide some context, the U.S. District Court evaluated the “falsity” element of the False Claims Act in the context of a hospice provider’s “clinical judgment” that a person meets the standard to be eligible for the Medicare Hospice Benefit. The requirement is that a patient be eligible for Medicare Part A and be “Terminally Ill” as defined by the regulation. “Terminally Ill” requires that the hospice Medical Director make a determination that the prognosis of the patient indicates a life expectancy of 6 months or less. So the issue is whether or not the “battle of expert opinion,” without some additional element, is enough to establish that a patient is not terminally ill rendering the subsequent Medicare reimbursement submissions false or fraudulent.
Of the “fraud and abuse” laws, the three decades old Ethics in Patient Referrals Act, 42 U.S.C. § 1395nn, dubbed “Stark Law” after Congressmen Pete Stark who sponsored it, can often be the most challenging to properly interpret and apply, easily leading to head scratching. The law as originally enacted was simple in concept: to remove any financial motivation for doctors to send their patients for unnecessary testing that could raise health care costs and/or result in bad health care. Now often subject to much criticism and even calls for repeal, Stark Law’s is often viewed as confusing, which is ironic because Congressman Stark intended for the law to create “bright line” tests that would provide clear guidance to physicians about what self-referral arrangements are unlawful. Instead, the evolution of the law over the years, including implementing regulations, advisory opinions and court cases have rendered proper interpretation and application of the law debatable and unpredictable in some circumstances.
In our Georgia business and healthcare law firm, we have noticed that cases involving Medicare fraud and billing compliance issues are published on virtually a daily basis, underscoring the critical need that physicians, nurses and other care providers and billing professionals exercise caution and vigilance in billing Medicare or other third party payers. For example, last week in Dallas, Texas, two physicians and three nurses were sentenced to prison for submitting fraudulent claims to Medicare through a home healthcare agency. The financial harm and potential billing fraud and serious “zero tolerance policy” of the Office of the Inspector and Federal Government for Medicare fraud has enhanced the financial and legal risks to healthcare providers and billing companies for all billing discrepancies. The OIG published its 2018 National Health Care Fraud Takedown providing the following statistics, which reflect law enforcement efforts to combat healthcare fraud and abuse:
The United States Department of Justice issued a press release on March 28, 2018 regarding the sentencing of Sandra Parkman, age 63, for Medicare fraud. Our business and health care law firm follows developments in the fraud and abuse legal arena. The DOJ, as well as numerous other Federal and state law enforcement agencies, are continuing with their push to crack down on offenses they determine to constitute “fraud and abuse” under applicable statutes and rules.
United States District Judge Kurt D. Engelhardt of the Eastern District of Louisiana sentenced Ms. Parkman to 32 months in prison. Additionally, she was ordered to pay $277,197 in restitution. Ms. Parkman elected to go to trial in her case. There was a three-day jury trial. At trial, the government presented evidence that Ms. Parkman engaged in a scheme to provide durable medical equipment (DME) that was not medically necessary to federal program beneficiaries in the New Orleans area. The owner of a DME supply company, Tracy Browns, a co-defendant in the case, allegedly paid kickbacks to Ms. Parkman to provide information of eligible Medicare beneficiaries and to obtain physician signatures on order forms for the DME in question. Brown was convicted in a separate trial and sentenced to 80 months in prison.
On January 19, 2017, the United States Department of Justice (DOJ) issued a press release announcing a deal reached with Costco Wholesale to resolve DOJ’s disputed allegations that Costco violated Federal law in filling prescriptions by lax protocol. The allegations against Costco stem from an investigation by the United States Drug Enforcement Agency (DEA) Diversion Groups based in Seattle, Los Angeles, Sacramento and Detroit.
Georgia Healthcare and Business Litigation Law Firm
Our Atlanta and Augusta-based business law firm closely follows healthcare industry legal developments, including the healthcare fraud and abuse matters. A strong focus of the DEA and supporting Federal and State law enforcement activities is the current epidemic of Opioid abuse in the United States. According to the United States Centers for Disease Control and Prevention (CDC), deaths from Opioid overdose in the United States have quadrupled since 1999; and during the same period, sales of these drugs quadrupled. The most common such Opioids are Methadone, Oxycodone and Hydrocodone. “Pill mills” are a principal target of DEA and State law enforcement efforts. To combat pill mills and other circumstances that may give rise to misuse of opioids and controlled substances, the DEA will pursue healthcare providers and entities that fail to strictly follow legal protocols in prescribing or dispensing controlled substances.
The United States Department of Health and Human Resources (HHS) and the United States Department of Justice (DOJ) recently issued a joint annual report for 2016 (the Report) providing details about the federal fraud and abuse program and, in particular, annual financial recoveries. Fraud and abuse law enforcement efforts continued to be a top priority for the Federal Government and an important means of defraying the rising costs of our nation’s healthcare delivery system. According to the Report, the Federal Government obtained over $2.5 billion in additional revenue in 2016 by way of health care fraud judgments and settlements.