$6B fraud bust includes numerous telehealth schemes

https://www.healthcaredive.com/news/6b-fraud-bust-includes-numerous-telehealth-schemes/586220/?utm_source=Sailthru&utm_medium=email&utm_campaign=Issue:%202020-10-01%20Healthcare%20Dive%20%5Bissue:29992%5D&utm_term=Healthcare%20Dive

Dive Brief:

  • Federal agencies have charged 345 people across the country, including more than 100 providers and four telehealth executives, with submitting more than $6 billion in fraudulent claims to payers. Of that, $4.5 billion was connected to telemedicine schemes and about $800 million each to substance abuse treatment and illegal opioid distribution.
  • More than 250 medical professionals had their federal healthcare billing privileges revoked for being involved in the scams, according to a statement released Wednesday.
  • The U.S. Department of Justice also said it is creating a new rapid response strike force to investigate fraud cases involving major providers that operate in multiple jurisdictions.

Dive Insight:

Telehealth fraud has increased significantly since 2016, the HHS Office of Inspector General said. As providers have quickly pivoted many services to virtual care during the COVID-19 pandemic, attempts at fraud will likely follow.

One of the cases outlined Wednesday included false claims for COVID-19 testing while another involved a COVID-19 related scheme to defraud insurers out of more than $4 million.

The telehealth fraud allegedly involved a marketing network that lured hundreds of thousands of people into a criminal scheme with phone calls, direct mail, TV ads and online pop-up ads. Telemedicine executives then paid doctors to order unneeded medical equipment, testing or drugs with either no patient interaction or only a brief call. 

Those were either not given to the patients or were worthless to them. The proceeds were then laundered through international shell corporations and banks.

The scheme is similar to one DOJ prosecuted in April 2019 involving fraudulent telehealth companies that pushed unneeded braces on Medicare beneficiaries in exchange for kickbacks from durable medical equipment companies.

The massive bust included the work of 175 HHS OIG agents and analysts and targeted myriad fraud operations across the U.S. and its territories.

One of the larger scams involved 29 defendants in the Middle District of Florida. A telemedicine company and medical professionals working for it billed Medicare for medical equipment for patients they never spoke to.

In New Jersey, laboratory owners paid marketers to get DNA samples at places like senior health fairs. Doctors on telemedicine platforms then ordered medically unnecessary and not reimbursable genetic testing.

 

 

 

 

Urgent care network to pay $12.5M in billing fraud case

https://www.beckershospitalreview.com/legal-regulatory-issues/urgent-care-network-to-pay-12-5m-in-billing-fraud-case.html?utm_medium=email

Different Types of Fraud and Abuse found in Medical Billing - Leading Medical  Billing Services | medicalbillersandcoders

A company that owned and operated more than 30 urgent care centers has agreed to pay $12.5 million to resolve overbilling allegations, the Department of Justice announced Sept. 3. 

UCXtra Umbrella, which did business in Arizona as Urgent Care Extra, previously admitted to engaging in healthcare fraud and monetary transactions derived from unlawful activity. The company admitted that it had billing procedures in place that caused its providers to overstate the complexity of the medical services provided to patients. This resulted in falsely inflated reimbursement rates from health insurance companies, according to the Justice Department. 

The company also admitted that staff were encouraged to order tests and procedures that may not have been medically necessary to justify higher billing codes and reimbursement. 

Health insurance companies overpaid the company by an estimated $12.5 million due to the fraud scheme, according to the Justice Department.

 

 

Feds sue to block Geisinger’s partial acquisition of 132-bed hospital

https://www.beckershospitalreview.com/hospital-transactions-and-valuation/feds-sue-to-block-geisinger-s-partial-acquisition-of-132-bed-hospital.html?utm_medium=email

Federal Antitrust Compliance Attorneys - Oberheiden, P.C.

The U.S. Justice Department sued to block Danville, Pa-based Geisinger’s partial acquisition of a 132-bed hospital in Lewisburg, Pa. 

In the antitrust suit, filed Aug. 5, prosecutors said Geisinger and Evangelical are close competitors for inpatient acute care for patients in six counties in Pennsylvania.

As a result, Geisinger’s plan to acquire a 30 percent ownership stake in Evangelical Community Hospital would “fundamentally” alter the relationship between the two organizations and reduce incentives to “compete aggressively against each other,” the complaint reads.

The suit also claims the agreement between the two parties would result in higher prices, lower care quality and reduced access to inpatient hospital services.

The Justice Department said Geisinger initially sought to acquire Evangelical  Community Hospital in full. But, instead pursued a partial acquisition agreement “in part to avoid antitrust scrutiny,” according to the suit. 

“Preserving competition in healthcare markets is a priority for the Department of Justice because of its important impact on the health and well-being of Americans,” said Makan Delrahim, an assistant attorney general of the Justice Department’s antitrust division. “This agreement between Geisinger and Evangelical threatens to harm patients in central Pennsylvania by reducing competition that has improved the price, quality, and availability of healthcare in the region.”

“We are disappointed by the decision and continue to believe enhancing our relationship with Geisinger is in the best interest of the region and will provide efficient, cost-effective healthcare to the communities we serve,” Kendra Aucker, president and CEO of Evangelical Community Hospital, told PennLive.

 

 

 

 

FTC, Justice Department have new guidelines for vertical mergers

https://www.beckershospitalreview.com/hospital-transactions-and-valuation/ftc-justice-department-have-new-guidelines-for-vertical-mergers.html?utm_medium=email

Trump Administration Updates Vertical Merger Guidelines - Multichannel

Guidance on vertical mergers got its first major overhaul from the Federal Trade Commission and the U.S. Department of Justice in more than 35 years under new joint guidelines published June 30.

Vertical mergers are those that combine firms or assets at different stages of the same supply chain, such as healthcare company CVS Health’s acquisition of insurer Aetna. Previously proposed mergers like that of insurers Humana and Aetna would be considered horizontal.

FTC Chairman Joe Simon said in a news release that the new guidances “are an important step forward in maintaining vigorous antitrust enforcement, and reaffirm our commitment to challenge vertical mergers that are anticompetitive and would harm American consumers.”

Leaders said that the guidelines explain FTC and Justice Department investigative practices and will give the business community clarity about antitrust concerns, such as the type of evidence the FTC and Justice Department review and how they define markets.

To read the full guidelines, click here

 

 

 

 

 

DOJ charges execs, others with elaborate $1.4B billing scheme using rural hospitals

https://www.healthcaredive.com/news/doj-charges-execs-others-with-elaborate-14b-billing-scheme-using-rural-h/580785/

Office of Attorney Recruitment & Management | Department of Justice

Dive Brief:

  • The U.S. Department of Justice is charging 10 defendants for an “elaborate” pass-through billing scheme that used small rural hospitals across three states as shells to submit fraudulent claims for laboratory testing to commercial insurers, jacking up reimbursement.
  • The defendants, including hospital executives, lab owners and recruiters, billed private payers roughly $1.4 billion from November 2015 to February 2018 for pricey lab testing, reaping $400 million.
  • The four rural hospitals used in the scheme are: Cambellton-Graceville Hospital, a 25-bed rural facility in Florida; Regional General Hospital of Williston, a 40-bed hospital in Florida; Chestatee Regional Hospital, a 49-bed facility in Georgia; and Putnam County Memorial Hospital, a 25-bed hospital in Missouri. Only Putnam emerged from the scheme relatively unscathed: Chestatee was sold to a health system that plans to replace it with a newer facility, Cambellton-Graceville closed in 2017 and RGH of Williston was sold for $100 to an accounting firm earlier this month.

Dive Insight:

The indictment, filed in the Middle District of Florida and unsealed Monday, alleges the 10 defendants, using management companies they owned, would take over rural hospitals often struggling financially. They would then bill commercial payers for millions of dollars for pricey urine analysis drug tests and blood tests through the rural hospitals, though the tests were normally conducted at outside labs, and launder the money to hide their trail and distribute proceeds.

The rural hospitals had negotiated rates with commercial insurers for higher reimbursement for tests than if they’d been run at an outside labs, so the facilities were used as a shell for fraudulent billing for often medically unnecessary tests, the indictment alleges.

The defendants, aged 34 to 60, would get urine and other samples by paying kickbacks to recruiters and healthcare providers, like sober homes and substance abuse treatment centers.

Screening urine tests, to determine the presence or absence of a substance in a patient’s system, is generally inexpensive and simple — it can be done at a substance abuse facility, a doctor’s office or a lab. But confirmatory tests, to identify concentration of a drug, are more precise and sensitive and have to be done at a sophisticated lab.

As such they’re more expensive and are typically reimbursed at higher rates than screening urine tests. None of the rural hospitals had the capacity to conduct confirmatory tests, or blood tests, on a large scale, but frequently billed in-network insurers, including CVS Health-owned Aetna, Florida Blue and Blue Cross Blue Shield of Georgia, for the service from 2015 to 2018, the indictment says.

Rural hospitals are facing unprecedented financial stress amid the pandemic, but have been fighting to keep their doors open for years against shrinking reimbursement and lowering patient volume. That can give bad actors an opportunity to come in and assume control.

One of the defendants, Jorge Perez, 60, owns a Miami-based hospital operator called Empower, which has seen many of its facilities fail after insurers refused to pay for suspect billing. Half of rural hospital bankruptcies last year were affiliated with Empower, which controlled 18 hospitals across eight states at the height of the operation. Over the past two years, 12 of the hospitals have declared bankruptcy. Eight have closed, leaving their rural communities without healthcare and a source of jobs.

“Schemes that exploit rural hospitals are particularly egregious as they can undermine access to care in underserved communities,” Thomas South, a deputy assistant inspector general in the Office of Personnel Management Office of Inspector General, said in a statement.

 

 

 

 

 

Trump will urge Supreme Court to strike down Obamacare

https://www.politico.com/news/2020/05/06/trump-supreme-court-obamacare-240366?utm_source=The+Fiscal+Times&utm_campaign=f343554e9c-EMAIL_CAMPAIGN_2020_05_06_09_42&utm_medium=email&utm_term=0_714147a9cf-f343554e9c-390702969

Trump will urge Supreme Court to strike down Obamacare - YouTube

Attorney General Bill Barr had urged the White House to soften its attack on the law during the pandemic.

President Donald Trump on Wednesday said his administration will urge the Supreme Court to overturn Obamacare, maintaining its all-out legal assault on the health care law amid a pandemic that will drive millions of more Americans to depend on its coverage.

The administration appears to be doubling down on its legal strategy, even after Attorney General William Barr this week warned top Trump officials about the political ramifications of undermining the health care safety net during the coronavirus emergency.

Democrats two years ago took back the House of Representatives and statehouses across the country by promising to defend Obamacare, in particular its insurance protections that prevent sick people from being denied coverage or charged more because of a health condition. The issue may prove to be even more salient in November amid the Covid-19 outbreak that health experts believe will persist through the fall.

The Justice Department had a Wednesday deadline to change its position in a case brought by Republican-led states, but Trump told reporters Wednesday afternoon his administration would stand firm. DOJ declined to comment.

“Obamacare is a disaster, but we’ve made it barely acceptable,” Trump said.

The Supreme Court later this fall will hear a lawsuit from the GOP-led states that argue the Affordable Care Act was rendered invalid after Congress eliminated its tax penalty for not having health insurance. A coalition of Democratic state attorneys general and the Democratic-led House of Representatives are defending the law in court.

The Trump administration had previously shifted its legal position in this case, but appears to have decided against doing so again. DOJ originally argued the courts should throw out just Obamacare’s preexisting condition protections, before last year urging that the entire law be struck down.

The Supreme Court is expected to hear the case during its next term starting in October, but it hasn’t scheduled arguments yet. A decision is unlikely before the Nov. 3 election. The court has previously upheld Obamacare in two major challenges that threatened the law’s survival.

About 20 million people have been covered by Obamacare, and the law is expected to provide a major safety net during the economic freefall brought on by the coronavirus. Millions more are expected to join the Medicaid rolls, especially in states that joined Obamacare’s expansion to poor adults. Others who lost workplace health insurance can sign up on the law’s health insurance marketplaces, though the Trump administration isn’t doing much to advertise coverage options.

House Democrats in a filing to the Supreme Court on Wednesday said the pandemic showcased why justices should preserve the law.

“Although Congress may not have enacted the ACA with the specific purpose of combatting a pandemic, the nation’s current public-health emergency has made it impossible to deny that broad access to affordable health care is not just a life-or death matter for millions of Americans, but an indispensable precondition to the social intercourse on which our security, welfare, and liberty ultimately depend,” their brief read.

Obamacare has grown more popular since the GOP’s failed repeal bid during Trump’s first year in office, though the law is still broadly disliked by Republicans. Many Democrats are eager to again run on their defense of Obamacare this fall. That includes presumptive presidential nominee Joe Biden, who has advocated for building on the health care law rather than pursuing a comprehensive progressive overhaul like “Medicare for All.”

Top Trump officials have long been split on the legal strategy in the Obamacare lawsuit. Barr and Alex Azar, the Health and Human Services secretary, both opposed a broader attack on the law, but White House officials have been more supportive, seeing it as a chance to fulfill Trump’s pledge to repeal Obamacare. Barr, in a Monday meeting with Vice President Mike Pence and other White House officials, made an eleventh-hour plea for the administration to soften its legal stance ahead of the Supreme Court’s briefing deadline.

 

 

 

Barr urges Trump administration to back off call to fully strike down Obamacare

https://www.cnn.com/2020/05/05/politics/william-barr-obamacare-supreme-court/index.html?fbclid=IwAR0H0M_pTi9V9W4iEAqWTWKJzopzznh6202z0FgsMbthJS7oS-pDowVGc3M

Barr urges Trump administration to back off call to fully strike ...

Attorney General William Barr made a last-minute push Monday to persuade the administration to modify its position in the Obamacare dispute that will be heard at the Supreme Court this fall, arguing that the administration should pull back from its insistence that the entire law be struck down.

With a Wednesday deadline to make any alterations to its argument looming, Barr made his case in a room with Vice President Mike Pence, White House counsel Pat Cipollone, members of the Domestic Policy Council, press secretary Kayleigh McEnany and several other officials. The meeting ended without a decision and it was not immediately not clear if any shift in the Trump administration’s position will emerge.
Barr and other top advisers have argued against the hard-line position for some time, warning it could have major political implications if the comprehensive health care law appears in jeopardy as voters head to the polls in November.
According to four sources familiar with the meeting, Barr argued for modifying the administration’s current stance to preserve parts of the law, rather than fully back the lawsuit filed by a group of Republican states. As it stands now, the Trump administration’s position seeks to invalidate the entire Affordable Care Act, signed by President Barack Obama in 2010 and commonly known as Obamacare.
Barr and Health and Human Services Secretary Alex Azar have argued against supporting invalidating the law in full, engaging in a heated debate on this point with then-acting White House chief of staff Mick Mulvaney and policy officials allied with him, CNN reported last year. But Barr and others have recently brought an additional dimension to their efforts, highlighting the coronavirus pandemic that has swept the nation. If the justices were to accept the Trump administration position, its decision could cause substantial disruptions to the health care of millions of Americans and cause the uninsured rate to spike.
The Affordable Care Act is expected to serve as an important safety net for the millions of people who lose their jobs and work-based health insurance amid the pandemic. If the unemployment rate hits 15%, nearly 17.7 million Americans could lose their employer-sponsored policies, according to a recent Urban Institute report. More than 8 million people could enroll in Medicaid, particularly in states that expanded the program to more low-income adults under the sweeping health care law. Also, more than 4 million people could obtain coverage through the Affordable Care Act exchanges or other private policies, leaving just over 5 million uninsured, the report found.
Even before the pandemic, more than 11.4 million people signed up for Obamacare coverage for 2020 and roughly 12.5 million were enrolled in Medicaid expansion.
Trump’s domestic policy aides have resisted any change in the Trump administration’s legal arguments at this point, contending that the legal position should move forward without changes because Republicans have campaigned on repealing Obamacare for a decade. Those aides have brushed off the possibility of any new political repercussions, and pushed back on Barr in the meeting Monday.
The Justice Department declined to comment.
The divide has been a long-running battle inside the administration, but it has a new sense of urgency because the administration is up against a deadline on Wednesday if it wants to modify its argument.
The administration currently contends that the individual insurance requirement is unconstitutional, and because that mandate is tied to other provisions of the law, the entire Affordable Care Act must fall. If the administration is going to back off that absolute position, it would likely submit a filing to the Supreme Court within the next 48 hours, based on the court’s current briefing schedule for the dueling parties. Otherwise, the administration’s brief would not be due to the high court until June.
Barr has long favored tempering the administration’s position, which has shifted multiple times since the lawsuit began in early 2018. The administration argued that only two key provisions that protect Americans with pre-existing conditions should fall, but the rest of the law could remain. In a dramatic reversal soon after Barr became attorney general in early 2019, the Justice Department said the entire Affordable Care Act should be invalidated. Several months later, the administration argued before a federal appeals court that the law should only be struck as it applies to the coalition of Republican-led states that brought the challenge.
The argument that the entire law should be struck down already might have been a tough one to make to a Supreme Court majority that has twice rejected broad-scale challenges.
After a decade, the Affordable Care Act has affected nearly every aspect of the health care system. It required all Americans obtain coverage and created a marketplace for purchasing insurance. It also expanded Medicaid for poor people and protected diabetics, cancer patients and other individuals with pre-existing conditions from being denied coverage or charged higher premiums.
The current Supreme Court dispute began when Texas and other Republican-led states sued after the Republican-led Congress in 2017 cut the tax penalty for those who failed to obtain insurance to zero. Because the individual mandate is no longer tied to a specific tax penalty, the states argue, it is unconstitutional. They also say that because the individual mandate is intertwined with a multitude of ACA provisions, invalidating it should bring down the entire law, including protections for people with preexisting conditions.
On the other side are California and other Democratic-led states and the now Democratic-controlled US House of Representatives. The Affordable Care Act has remained in effect through the litigation.
The Supreme Court agreed earlier this year to take up the ACA dispute. The case is likely to be heard in the fall, but a decision would not be expected until 2021, after the November presidential election.
The case will mark the third time that the Supreme Court takes up a major ACA dispute. In 2012, the justices upheld the law, by a 5-4 vote, with Chief Justice John Roberts casting the deciding vote with the four liberal justices over the dissent of four conservatives. Roberts grounded his opinion in Congress’ taxing power.

 

 

 

Large, Troubled Companies Got Bailout Money in Small-Business Loan Program

Large, Troubled Companies Got Bailout Money in Small-Business Loan ...

Companies with accounting problems or in trouble with the government received millions in federal loans.

A company in Georgia paid $6.5 million to resolve a Justice Department investigation — and, two weeks later, received a $10 million federally backed loan to help it survive the coronavirus crisis.

Another company, AutoWeb, disclosed last week that it had paid its chief executive $1.7 million in 2019 — a week after it received $1.4 million from the same loan program.

And Intellinetics, a software company in Ohio, got $838,700 from the government program — and then agreed, the following week, to spend at least $300,000 to purchase a rival firm.

The vast economic rescue package that President Trump signed into law last month included $349 billion in low-interest loans for small businesses. The so-called Paycheck Protection Program was supposed to help prevent small companies — generally those with fewer than 500 employees in the United States — from capsizing as the economy sinks into what looks like a severe recession.

The loan program was meant for companies that could no longer finance themselves through traditional means, like raising money in the markets or borrowing from banks under existing credit lines. The law required that the federal money — which comes at a low 1 percent interest rate and in some cases doesn’t need to be paid back — be spent on things like payroll or rent.

But the program has been riddled with problems. Within days of its start, its money ran out, prompting Congress to approve an additional $310 billion in funding that will open for applications on Monday. Countless small businesses were shut out, even as a number of large companies received millions of dollars in aid.

Some, including restaurant chains like Ruth’s Chris and Shake Shack, agreed to return their loans after a public outcry. But dozens of large but lower-profile companies with financial or legal problems have also received large payouts under the program, according to an analysis of the more than 200 publicly traded companies that have disclosed receiving a total of more than $750 million in bailout loans.

Another dozen or so collected money even though they have recently reported being able to raise large sums through private means. Several others have recently showered top executives with seven-figure pay packages.

The government isn’t disclosing who receives aid, leaving it up to individual companies to decide whether to disclose that they obtained loans. That makes a full accounting of the loan program impossible.

“It’s outrageous,” said Amanda Ballantyne, the executive director of Main Street Alliance, an advocacy group for small businesses. She added that there were countless small business owners “who have laid off all their staff, are trying to file for unemployment and will go bankrupt because of the problems with the way this Paycheck Protection Program was designed.”

Applicants for loans do not need to provide evidence that they have been harmed by the pandemic. They simply need to certify that “current economic uncertainty makes this loan request necessary” to support their operations.

Instead of having the Small Business Administration, which is guaranteeing the loans, decide which companies get funding, the process was essentially outsourced to banks. The banks collect fees for each loan they make but don’t have to monitor whether the recipients use the money appropriately.

For small business owners shut out of the program, watching big companies collect loans while their applications languish has been infuriating.

“It has been beyond frustrating,” said Diane Burgio, a single mother who runs a design business in New York City that employs four people. She was one of more than 280,000 applicants who sought, and did not get, a loan from JPMorgan Chase.

The New York Times identified roughly a dozen publicly traded companies that had recently boasted about their access to ample capital — and then applied for and received millions of dollars in the federal loans.

Legacy Housing, a Texas company that manufactures premade homes, announced on April 1 that it had access to a new $25 million credit line. Curtis D. Hodgson, Legacy’s executive chairman, told investors that he expected any damage from the coronavirus to be short-lived. “Our order book is still strong, and we are well-positioned once the situation begins to normalize,” he said.

Less than two weeks later, on April 10, the company announced that a local lender, Peoples Bank, had approved it for $6.5 million under the S.B.A. loan program.

In an interview on Sunday, Mr. Hodgson said that an inquiry from The Times led the company to decide to give back the money it borrowed, though he defended seeking the loan in the first place. “Legacy is a highly leveraged company without cash on hand,” he said. “Here was a way to get a cash infusion.”

Escalade Sports, which makes things like table tennis tables and basketball hoops, already had a $50 million credit line from JPMorgan Chase. The company’s chief executive, Dave Fetherman, told investors this month that the company, based in Evansville, Ind., had “a strong balance sheet” and was seeing rising demand for its products, with so many Americans cooped up in their homes.

Days earlier, Escalade got a $5.6 million federally backed loan. A spokesman for Escalade said the company “fully met all required conditions at the time we applied for the P.P.P. loan.”

Executives at some companies said applying for the loans made clear business sense. The loans are essentially free money: They have rock-bottom interest rates and can be forgiven if, among other things, the borrower maintains the size of its work force. In some cases, executives said, their bankers encouraged them to apply for the loans.

At least seven companies that received a total of $45 million in loans under the federal government’s program have recently had serious scrapes with the federal government.

MiMedx Group, a biopharmaceutical company in Marietta, Ga., got a $10 million loan on April 21. On April 6, the company had agreed to pay the Justice Department $6.5 million to resolve allegations that it violated federal law by knowingly overcharging the Department of Veterans Affairs for medical supplies.

MiMedx, which makes and sells human tissue grafts, also ran into problems with the Securities and Exchange Commission. Last year, the agency sued MiMedx, accusing the company of exaggerating its revenue to investors over several years. MiMedx agreed to settle the case for $1.5 million, without admitting wrongdoing. Two of its former top executives were indicted last year by federal prosecutors in Manhattan on charges of accounting fraud.

A MiMedx spokeswoman, Hilary Dixon, said the company was trying to move past its accounting scandal. “We don’t have the option of raising capital in the public markets owing to our financial restatement process,” she said.

Another company, US Auto Parts Network, which received a $4.1 million loan through the program, has been in a heated dispute in recent years with Customs and Border Protection. The agency has seized some of the company’s imported products, claiming they are counterfeit.

US Auto Parts Network didn’t respond to requests for comment.

At least two companies that received federally backed loans have previously borrowed heavily from their own executives or others close to the firms — meaning that the new loans could help the companies repay their insiders.

Infinite Group, a cybersecurity firm in Pittsford, N.Y., had been borrowing hundreds of thousands of dollars from its board members and the brother of a top executive at annual interest rates as high as 7.5 percent. This month, Infinite secured a nearly $1 million federally backed loan whose 1 percent interest rate could allow the company to dramatically lower its funding costs. Company officials didn’t respond to requests for comment.

Intellinetics, the company that announced that it was buying a rival days after it received its emergency loan of $838,700, borrowed nearly $400,000 last fall from two brothers who run a small New York brokerage firm, Taglich Brothers. If the money isn’t repaid by May 15, Intellinetics will need to give the brothers stock in the company or start paying a steep 12 percent interest rate. (Some of that debt has already been converted into stock.)

“Securing the PPP funding gives us extra confidence and ability to restart and hit the ground running,” James F. DeSocio, the company’s chief executive, said in a news release.

Infinite Group and Intellinetics have not said precisely how they intend to use the loan proceeds.

A number of other companies have had serious accounting problems. The chief financial officer of CPI Aerostructures, an aerospace manufacturer that got a $4.8 million loanresigned in February after the company disclosed major problems with how it reported revenue.

And several firms have been paying their top executives millions of dollars despite financial problems that predate the coronavirus crisis.

For example, AutoWeb’s chief executive, Jared Rowe, got $4.7 million in total compensation over the past two years — including $1.7 million in 2019 — even as its stock price plummeted more than 70 percent. The company declined to comment.

And Manning & Napier, an investment firm in Fairport, N.Y., that has about $20 billion in assets under management, disclosed in March that its chief executive, Marc O. Mayer, earned nearly $5 million last year. On April 19, the company was approved for $6.7 million in the paycheck protection loans — even as the company said it would pay out a quarterly dividend to its shareholders.

Last week, amid mounting public anger toward large recipients of the rescue loans, Manning & Napier said it had decided not to take the money.

While the federal loan program is supposed to help companies avoid layoffs, some of the large recipients of loans have already dramatically reduced their workforces — and not always because of the coronavirus.

Harvard Bioscience, based in Holliston, Mass., has been trying since last year to pacify an activist investor that is pressuring management to boost the company’s stock price. The company closed facilities in North Carolina and Connecticut and said in February, before the coronavirus upended the economy, that it was laying off about 10 percent of its work force.

This month, Harvard Bioscience received a $6.1 million loan through the paycheck protection program. In a securities filing disclosing the loan, the company didn’t say why it sought the money or how it would use it. A spokesman didn’t respond to requests for comment.

A number of relatively large companies with connections to Mr. Trump also received millions of dollars in loans.

Phunware, a data-collection company that received a $2.9 million loan this month, counts Mr. Trump’s re-election campaign and Fox News as two of its biggest clients.

Continental Materials, a heating and air conditioning and construction material supplier based in Chicago, got a $5.5 million loan. The firm’s chief executive, James Gidwitz, is a major Trump donor, and his brother Ronald was appointed ambassador to Brussels by Mr. Trump after serving as Illinois campaign finance chairman for the 2016 Trump campaign.

It isn’t clear whether political considerations helped Phunware and Continental Materials get their loans approved. Neither company responded to requests for comment.

 

 

 

 

Anthony Fauci’s security is stepped up as doctor and face of U.S. coronavirus response receives threats

https://www.washingtonpost.com/politics/anthony-faucis-security-is-stepped-up-as-doctor-and-face-of-us-coronavirus-response-receives-threats/2020/04/01/ff861a16-744d-11ea-85cb-8670579b863d_story.html?utm_campaign=wp_news_alert_revere&utm_medium=email&utm_source=alert&wpisrc=al_news__alert-hse–alert-national&wpmk=1

Nation's top coronavirus expert Dr. Anthony Fauci forced to beef ...

Anthony S. Fauci, the nation’s top infectious-diseases expert and the face of the U.S. response to the novel coronavirus pandemic, is facing growing threats to his personal safety, prompting the government to step up his security, according to people familiar with the matter.

The concerns include threats as well as unwelcome communications from fervent admirers, according to people with knowledge of deliberations inside the Department of Health and Human Services and the Department of Justice.

Fauci, 79, is the most outspoken member of the administration in favor of sweeping public health guidelines and is among the few officials willing to correct President Trump’s misstatements. Along with Deborah Birx, the coordinator for the White House’s task force, Fauci has encouraged the president to extend the timeline for social-distancing guidelines, presenting him with grim models about the possible toll of the pandemic.

“Now is the time, whenever you’re having an effect, not to take your foot off the accelerator and on the brake, but to just press it down on the accelerator,” he said Tuesday as the White House’s task force made some of those models public, warning of 100,000 to 240,000 deaths in the United States.

The exact nature of the threats against him was not clear. Greater exposure has led to more praise for the doctor but also more criticism.

Fauci has become a public target for some right-wing commentators and bloggers, who exercise influence over parts of the president’s base. As they press for the president to ease restrictions to reinvigorate economic activity, some of these figures have assailed Fauci and questioned his expertise.

Last month, an article depicting him as an agent of the “deep state” gained nearly 25,000 interactions on Facebook — meaning likes, comments and shares — as it was posted to large pro-Trump groups with titles such as “Trump Strong” and “Tampa Bay Trump Club.”

Alex Azar, the HHS secretary, recently grew concerned about Fauci’s safety as his profile rose and he endured more vitriolic criticism online, according to people familiar with the situation. In recent weeks, admirers have also approached Fauci, asking to him sign baseballs, along with other acts of adulation. It was determined that Fauci should have a security detail. Azar also has a security detail because he is in the presidential line of succession.

Asked Wednesday whether he was receiving security protection, Fauci told reporters, “I would have to refer you to HHS [inspector general] on that. I wouldn’t comment.”

The president interjected, saying, “He doesn’t need security. Everybody loves him.”

HHS asked the U.S. Marshals Service to deputize a group of agents in the office of the HHS inspector general to provide protective services for the doctor, according to an official with knowledge of the request.

The U.S. Marshals Service conveyed the request to the deputy attorney general, who has authority over deputations for the purpose of providing protective services, with the recommendation that it be approved, according to the official, who spoke on the condition of anonymity to reveal sensitive plans that the person was not authorized to discuss.

A Justice Department official signed paperwork Tuesday authorizing HHS to provide its own security detail to Fauci, according to an administration official.

An HHS spokesperson declined to discuss details of the doctor’s security but said: “Dr. Fauci is an integral part of the U.S. Government’s response against covid-19. Among other efforts, he is leading the development of a covid-19 vaccine and he regularly appears at White House press briefings and media interviews.”

At the briefings, Fauci, who has advised presidents of both parties as director of the National Institute of Allergy and Infectious Diseases, has spoken authoritatively about the spread of the coronavirus and the sacrifices involved in mitigating its effects.

He has at times corrected the president, in particular when prompted by reporters. After Trump said a covid-19 vaccine would be available in a couple of months, Fauci said it would in fact be available in about a year to a year and a half, at best.

His role has turned him into a hero for some. When he was absent from a briefing last month, followers who had grown accustomed to his frank assessments of the outbreak were alarmed that he might have been sidelined for his forthrightness. Many took to Twitter to ask, “Where is Dr. Fauci?” causing the question to trend on the platform.

He gained viral attention two days later when he placed his hand in front of his face in a gesture of apparent disbelief as Trump referred to the State Department as the “deep state department” from the White House briefing room.

Fauci has also given several interviews in which he has tempered praise for the president with doubts about his pronouncements, including about the viability of anti-malarial drugs as a treatment for the novel coronavirus. Most notably, he told the journal Science that he attempts to guide Trump’s statements but “can’t jump in front of the microphone and push him down.”

These moves have inspired fandom. But they have also drawn scorn from some of the president’s most vocal supporters, even as both men have sought to tamp down the appearance of tension.

“The president was right, and frankly Fauci was wrong,” Lou Dobbs said last week on his show on the Fox Business Network, referring to the use of experimental medicine.

Right-wing news and opinion sites have gone further, launching baseless smears against the doctor that have gained significant traction within pro-Trump communities online.

Outlets such as the Gateway Pundit and American Thinker seized on a 2013 email — released by WikiLeaks as part of a cache of communications hacked by Russian operatives — in which Fauci praised Hillary Clinton’s “stamina and capability” during her testimony as secretary of state before the congressional committee investigating the attacks in Benghazi, Libya.

The headline in the American Thinker referred to Fauci as a “Deep-State ­Hillary Clinton-loving stooge.” The author, Peter Barry Chowka, didn’t respond to requests for comment. When asked about the relevance of Fauci’s emails to his role in advising the White House’s coronavirus response, Jim Hoft, the editor of the Gateway Pundit, said, “I don’t have a problem with more information being shared about the doctor.”

The outlet has continued to criticize Fauci in recent days, saying that by offering new predictions about the possible death toll, Fauci and others were “going to destroy the U.S. economy based on total guesses and hysterical predictions.”

Several senior administration officials said that Trump respects Fauci and that the two generally have a good working relationship. Trump heeded the guidance of Fauci and Birx this week when he announced his administration would extend social-distancing guidelines for another 30 days. Last week, many health officials and experts grew worried when Trump said he hoped to reopen the country by Easter, even as coronavirus cases in the United States continue to rapidly climb.

The immunologist, who graduated first in his class from Cornell’s medical school, has been the director of the National Institute of Allergy and Infectious Diseases since 1984. Between 1983 and 2002, he was the 13th-most-cited scientist among the 2.5 million to 3 million authors worldwide and across all disciplines publishing in scientific journals, according to the Institute for Scientific Information.

 

 

 

Justice Department sues Anthem, alleging Medicare fraud

https://www.axios.com/doj-anthem-lawsuit-medicare-advantage-fraud-11cdba13-eacd-4847-9bb0-20aa993235f9.html?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosvitals&stream=top

Justice Department sues Anthem alleging Medicare Advantage fraud ...

The Department of Justice has sued Anthem, alleging that the health insurance company knowingly submitted inaccurate medical codes to the federal government from 2014 to 2018 as a way to get higher payments for its Medicare Advantage plans and turned “a blind eye” to coding problems.

Why it matters: This is one of the largest Medicare Advantage fraud lawsuits to date, and federal prosecutors believe they have more than enough to evidence to claim that Anthem bilked millions of dollars from taxpayers.

Background: DOJ has been probing the “risk adjustment” practices of all the major Medicare Advantage insurers for years, but hadn’t pulled the trigger on a lawsuit against a major player.

  • Risk adjustment is the process by which Medicare Advantage companies assign scores to their members based on the health conditions they have. Patients who have higher risk scores lead to higher payments from the federal government to the companies that insure them.
  • Insurers are required to review patients’ medical charts to verify the health conditions, and if insurers find any inaccurate diagnoses, they have to be deleted — which also would require the companies to pay back money to the federal government.

The Department of Justice is alleging that Anthem reviewed medical records, but only focused on finding “all possible new revenue-generating codes” while purposefully ignoring all erroneous diagnoses.

  • For example, according to the DOJ’s lawsuit, Anthem coded one member in 2015 as having active lung cancer.
  • “Anthem’s chart review program did not substantiate the active lung cancer diagnosis,” the DOJ alleges. Instead of deleting that diagnosis, Anthem allegedly added another three codes — leading to a $7,000 overpayment just for that member that year.

The other side: Anthem said in a statement that it intends “to vigorously defend our Medicare risk adjustment practices” and that “the government is trying to hold Anthem and other Medicare Advantage plans to payment standards that CMS does not apply to original Medicare.”

The big picture: Medicare Advantage continues to enroll seniors and people with disabilities at high rates, even as more allegations of fraud come out against the insurers that run the program.

Read the lawsuit.