Wisconsin health system fires VP accused in kickback scheme

Mercyhealth fires Vice President suspected in $3 million fraud with vendor  | Business News | beloitdailynews.com

Janesville, Wis.-based Mercyhealth has fired a vice president in charge of marketing and public relations over an alleged kickback scheme with a vendor, the Janesville Gazette reported Aug.16, citing a letter from the health system’s CEO. 

The vice president, Barb Bortner, was fired after health system leaders learned of a $3 million fraudulent invoice and kickback scheme that she was allegedly involved in, Mercyhealth President and CEO Javon Bea said in the letter obtained by the Gazette

“Our patients and communities we serve expect us to conduct our business affairs with the highest degree of integrity. We are all deeply saddened and disappointed that a member of our team has betrayed that trust,” Mr. Bea wrote in the letter, according to the Rockford Register Star.

Mr. Bea said Mercyhealth officials suspect Ms. Bortner is responsible for fraudulent and “improper” arrangements with an unnamed vendor, and the alleged fraud was linked to the system’s marketing division. Mercyhealth is severing ties with the vendor believed to be involved, the Gazette reported. 

The fraud does not appear to have impacted patient care, and the system is taking “all necessary steps to improve Mercyhealth procedures,” Mr. Bea wrote, according to the report. 

Read the full Gazette article here

Cleveland Clinic-owned hospital system pays $21M to settle False Claims allegations

Dive Brief:

  • A Cleveland Clinic-owned hospital system in Akron, Ohio, is paying the federal government $21.3 million to settle claims it illegally billed the Medicare program.
  • Akron General Health System allegedly overpaid physicians well above market value for referring physicians to the system, violating the Anti-Kickback Statute and Physician Self-Referral Law, and then billed Medicare for the improperly referred business, violating the False Claims Act, between August 2010 and March 2016.
  • Along with an AGHS whistleblower, the Cleveland Clinic Foundation, which acquired the system at the end of 2015, voluntarily disclosed to the federal government its concerns with the compensation arrangements, which were enacted by AGHS’ prior leadership, the Department of Justice said Friday.

Dive Insight:

The Anti-Kickback Statute forbids providers from paying for or otherwise soliciting other parties to get them to refer patients covered by federal programs like Medicare, while the Physician Self-Referral Law, otherwise known as the Stark Law, prohibits a hospital from billing for those services. Despite the laws and a bevy of other regulations resulting in a barrage of DOJ lawsuits and been a thorn in the side of providers for decades, fraud is still rampant in healthcare.

Of the more than $3 billion recovered by the government in 2019 from fraud and false claims, almost 90% involved the healthcare industry, according to DOJ data.

“Physicians must make referrals and other medical decisions based on what is best for patients, not to serve profit-boosting business arrangements,” HHS Office of Inspector General Special Agent in Charge Lamont Pugh said in a statement on the AGHS settlement.

Cleveland Clinic struck a deal with AGHS in 2014, agreeing to pay $100 million for minority ownership in the system. The agreement gave the clinic the option to fully acquire AGHS after a year, which it exercised as soon as that period expired in August 2015.

The settlement stems from a whistleblower suit brought by AGHS’s former Director of Internal Audit Beverly Brouse, who will receive a portion of the settlement, the DOJ said. The False Claims Act allows whistleblowers to share in the proceeds of a suit.

As fraud has increased in healthcare over the past decade — the DOJ reported 247 new matters for potential investigation in 2000, 427 in 2010 and 505 in 2019 — the federal government has renewed its efforts to crack down on illegal schemes. That’s resulted in the formation of groups like the Medicare Fraud Strike Force in 2007 and the Opioid Fraud and Abuse Detection Unit in 2017, which has in turn resulted in the DOJ recovering huge sums in stings, settlements and guilty verdicts.

Some of the biggest settlements reach into the hundreds of millions, and involve billions in false claims.

In 2018, DOJ charged more than 600 people for falsely billing federal programs more than $2 billion; last year federal agencies charged almost 350 people for submitting more than $6 billion in false claims. That last case led to creation of a rapid response strike force to investigate fraud involving major providers in multiple geographies.

Other large settlements include Walgreens’ $270 million fine in 2019 to settle lawsuits accusing the pharmacy giant of improperly billing Medicare and Medicaid for drug reimbursements; hospital operator UHS’ $122 million settlement last summer finalizing a fraudulent billing case with the DOJ after being accused of fraudulently billing Medicare and Medicaid for services at its behavioral healthcare facilities; and West Virginia’s oldest hospital, nonprofit Wheeling Hospital, agreeing in September to pay $50 million to settle allegations it systematically violated the laws against physician kickbacks, improper referrals and false billing.

EHR vendor eClinicalWorks paid $155 million to settle False Claims Act allegations around misrepresentation of software capabilities in 2017, while Florida-based EHR vendor Greenway Health was hit with a $57.3 million fine in 2019 to to settle allegations the vendor caused users to submit false claims to the EHR Incentives Program.

Virginia physician gets 59-year sentence for unneeded patient surgeries, $20M fraud

A Virginia OB-GYN was sentenced May 18 to 59 years in prison for a fraud scheme that caused insurance programs to lose more than $20 million, according to the U.S. Justice Department

Javaid Perwaiz, MD, was sentenced after being convicted last November of 52 counts of healthcare fraud and false statements related to a scheme in which he performed medically unnecessary surgeries, including hysterectomies and improper sterilizations, on his patients. 

From about 2010 to 2019, Dr. Perwaiz often falsely told his patients that they needed the surgeries because they had cancer or could avoid cancer, prosecutors said. Additionally, evidence showed Dr. Perwaiz falsified records for his obstetric patients to induce labor early to ensure he was reimbursed for the deliveries and violated Medicaid’s required 30-day waiting period for elective sterilization procedures by backdating records to make it appear that he had complied with the waiting period. Dr. Perwaiz also billed insurance companies for diagnostic procedures that he only pretended to perform at his office, prosecutors said. 

“Motivated by his insatiable and reprehensible greed, Perwaiz used an arsenal of horrifying tactics to manipulate and deceive patients into undergoing invasive, unnecessary and devastating medical procedures,” Raj Parekh, acting U.S. attorney in the Eastern District of Virginia, stated. “In many instances, the defendant shattered their ability to have children by using fear to remove organs from their bodies that he had no right to take.”

A lawyer representing Dr. Perwaiz told The New York Times that Dr. Perwaiz is appealing the conviction. 

3 Ascension Texas hospitals to pay $20.9M for alleged kickbacks

Kickback Definition

Three Ascension hospitals in Texas agreed to pay $20.9 million for allegedly paying multiple physician groups above fair market value for services, according to a recent news release from the HHS’ Office of Inspector General.

The three Texas hospitals are Ascension’s Dell Seton Medical Center in Austin, Ascension Seton Medical Center Austin and Ascension Seton Williamson in Roundrock. Ascension self-disclosed the conduct to the inspector general.

The hospitals allegedly violated the Civil Monetary Penalties Law, including provisions related to physician self-referrals and kickbacks in seven instances, according to the April 30 news release.

Some of the allegations the report outlined include Dell Seton paying an Austin physician practice above fair market value for on-call coverage; Ascension Seton Austin paying an Austin practice above fair market value for transplant on-call coverage and administrative services; and Ascension Seton Williamson paying a practice above fair market value to lease the practice’s employed registered nurses and surgical technologists who assisted in surgeries at the hospital. 

The release did not disclose the physician groups allegedly involved.

Access the full release here

The barriers to vaccine passports

https://www.axios.com/barriers-coronavirus-vaccine-passport-ee5ae689-c9e2-4306-9671-0af28bf21445.html

Vaccine passports could become available soon to help people resume their lives — but they face numerous scientific, social and political barriers to being accepted.

The big picture: Reliable and accessible proof of vaccine-induced protection from the novel coronavirus could speed international travel and economic reopening, but obstacles to its wide-scale adoption are so great it may never fully arrive.

Driving the news: The secure digital identity app CLEAR and CommonPass, a health app that lets users access vaccination records and COVID-19 test results, will be working together to offer a vaccine passport service, my Axios colleague Erica Pandey reports.

  • The news comes as a growing number of countries and companies are talking up plans to introduce similar vaccine passports that could help the protected return to normal life and travel as soon as possible.
  • To restart the economy, to save certain industries, I think you need a solution like this,” Eric Piscini, a vice president at IBM who oversaw the development of the company’s new health passport app, told the New York Times.

Yes, but: There are numerous health, ethical and operational questions that need to be resolved before vaccine passports could become an effective part of daily life.

Health: Medical experts still don’t fully know how effective vaccinations — or exposure to the virus — are at preventing onward transmission of COVID-19.

  • While the CDC is set to soon release new guidance around social activity for fully vaccinated people, current recommendations still call for them to keep wearing masks and practicing social distancing.
  • Until it’s clear that vaccination effectively prevents transmission, there’s a limit to how useful any vaccine passport can be for public health — especially if emerging variants render some vaccines less protective.
  • The utility of a vaccine passport is only as good as the evidence of how long the immunity lasts,” David Salisbury, an associate fellow at think tank Chatham House, told Bloomberg. “You could find yourself with a stamp in your passport that lasts longer than the antibodies in your blood.”

Ethical: The most obvious use case for vaccine passports is for international travel, which has been crippled by onerous quarantine restrictions. But such a system risks locking out billions of people who are unable or unwilling to get the vaccine.

  • The EU has been discussing the creation of a vaccine passport, with tourism-dependent countries like Greece leading the charge. But Germany and France — where the vaccine rollout has been low and hesitancy is high — have reservations, and any such system looks to be months away.
  • A bigger ethical concern is the many people in developing countries who may not get access to vaccines of any sort for months or even years while rich nations hoard supplies.
  • And if vaccine passports are used not just for international travel but to allow people to work and engage in social life domestically, they could create cripplingly unequal barriers that might paradoxically reinforce vaccine hesitancy.

Operational: Passports for international travel are regulated by governments and have decades of history behind them, but there’s no such unified system for vaccine passports, which are being introduced by governments and businesses with different standards, making them a target for fraud.

  • The U.S. in particular has a decentralized medical system that can make it difficult for people to easily access their health care records, especially if they lack digital literacy.
  • “I can pretty much 100% guarantee that fraud is going to occur,” says Jane Lee, a trust and safety architect at the cybersecurity company Sift. “We will have a lot of bad actors where they pretend to offer a service that will provide some sort of vaccination passport, but it’s really a phishing campaign.”

Be smart: None of these obstacles are insurmountable on their own. But as we saw with the failures of digital contact tracing, just because a technological solution exists doesn’t mean it will be effective or adopted by the public.

  • “There’s a huge motivation to make this work socially,” says Kevin Trilli, chief product officer at Onfido, an identification verification company. “But there’s a lot of governmental issues that are going to really make the system difficult to implement.”
  • There’s a time pressure at work here as well, especially in the U.S, where vaccination rates have picked up. The more people who are vaccinated, the less value there will be in creating a complex system to sift the protected from the unprotected.

The bottom line: Some form of vaccine visas will likely be introduced for international travel, but it seems unlikely they’ll become a passport to resuming normal life.

Executives, physicians at Texas hospital sentenced in $200M scheme

Kickback Definition

Fourteen defendants have been sentenced to more than 74 years in prison combined and ordered to pay $82.9 million in restitution for their roles in a $200 million healthcare scheme designed to get physicians to steer patients to Forest Park Medical Center, a now-defunct hospital in Dallas, the U.S. Justice Department announced March 19. 

More than 21 defendants were charged in a federal indictment in 2016 for their alleged involvement in a bribe and kickback scheme that involved paying surgeons, lawyers and others for referring patients to FPMC’s facilities. Those involved in the scheme paid and/or received $40 million in bribes and kickbacks for referring patients, and the fraud resulted in FPMC collecting $200 million. 

Several of the defendants, including a founder and former administrator of FPMC, were convicted at trial in April 2019 and sentenced last week. Other defendants pleaded guilty before trial.  

Hospital manager and founder Andrew Beauchamp pleaded guilty in 2018 to conspiracy to pay healthcare bribes and commercial bribery, then testified for the government during his co-conspirators’ trial. He admitted that the hospital “bought surgeries” and then “papered it up to make it look good.” He was sentenced March 19 to 63 months in prison. 

Wilton “Mac” Burt, a founder and managing partner of the hospital, was found guilty of conspiracy, paying kickbacks, commercial bribery in violation of the Travel Act and money laundering. He was sentenced March 17 to 150 months in prison. 

Four surgeons, a physician and a nurse were among the other defendants sentenced last week for their roles in the scheme. Access a list of the defendants and their sentences here

Ohio AG Yost files suit against Centene, launching latest salvo in his war on PBMs

Ohio Attorney General Dave Yost has filed suit against Centene and several of its subsidiaries, alleging that they schemed to misrepresent pharmacy costs and gain overpayments from the state’s Medicaid program.

According to the lawsuit, Centene subsidiary Buckeye Health Plan used sister companies Envolve Health Solutions and Health Net Pharmacy Solutions to administer its pharmacy benefit. Yost’s office said it began to investigate their business practices as the arrangement “raised questions.”

In a statement, Yost’s office said the investigation, which was conducted by outside counsel, found that the companies filed reimbursement requests for amounts that had already been paid by third parties, and failed to accurately represent costs to the Ohio Department of Medicaid.

In addition, the scheme led to artificially inflated dispensing fees, the AG’s office said.

Corporate greed has led Centene and its wholly-owned subsidiaries to fleece taxpayers out of millions. This conspiracy to obtain Medicaid payments through deceptive means stops now,” Yost said in a statement. “My office has worked tirelessly to untangle this complex scheme, and we are confident that Centene and its affiliates have materially breached their obligations both to the Department of Medicaid and the state of Ohio.”

Yost has openly declared war on PBMs and has made investigating their business practices a critical initiative within his office. In March 2019, the AG filed suit against Optum, seeking to reclaim $16 million in what he says are drug overcharges.

The AG filed a similar suit against Express Scripts in July 2020.

In a statement, Centene called the claims in the lawsuit “unfounded” and said it will “aggressively defend” against the allegations.

“Envolve’s pharmacy contracts with the State are reviewed and pre-approved by state agencies before they ever go into effect. Furthermore, these services saved millions of tax-payer dollars for Ohioans from market-based pharmaceutical pricing,” Centene said.

“We look forward to answering any of the Attorney General’s questions. Our company is committed to the highest levels of quality and transparency,” the insurer said.

Michigan healthcare CEO gets 15 years in prison for $150M fraud

IIG trade finance fund caught in alleged Ponzi scheme | Global Trade Review  (GTR)

The CEO of a chain of medical clinics in Michigan and Ohio was sentenced March 3 to 15 years in prison and ordered to pay $51 million in restitution for his role in a $150 million healthcare fraud scheme, according to the U.S. Justice Department

Mashiyat Rashid was sentenced after pleading guilty in 2018 to money laundering and conspiracy to commit healthcare fraud and wire fraud. Twenty other defendants, including 12 physicians, have been convicted for their involvement in the scheme. 

Mr. Rashid, who served as CEO of Tri-County Wellness Group from 2008 to 2016, developed and approved a corporate policy to administer unnecessary back injections to patients in exchange for prescriptions of over 6.6 million doses of medically unnecessary opioids, according to the Justice Department. 

Many patients experienced pain from the unnecessary injections, and some developed adverse conditions, including open holes in their backs, according to testimony at Mr. Rashid’s trial. Physicians at the clinics denied patients, including those addicted to opioids, medication until they agreed to get the injections, according to court documents. 

According to evidence presented at trial, Mr. Rashid only hired physicians who were willing to administer the unnecessary injections in exchange for a split of the Medicare reimbursements for the procedures. Tri-County Wellness Group was paid more for facet joint injections than any other medical clinic in the U.S., according to the Justice Department. 

Proceeds of the fraud were used to fund private jets and to buy luxury cars, real estate and tickets to NBA games, prosecutors said. Mr. Rashid was ordered to forfeit to the U.S. government $11.5 million in proceeds traceable to the healthcare fraud scheme, including commercial and residential real estate and Detroit Pistons season tickets. 

CEO gets 15 years in prison for $150M healthcare fraud

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The CEO of a group of Texas-based hospice and home health companies was sentenced Feb. 3 to 15 years in prison for his role in a $150 million healthcare fraud and money laundering scheme, according to the Department of Justice

Henry McInnis was sentenced more than a year after he was convicted of conspiracy to commit healthcare fraud, conspiracy to commit money laundering, obstruction of justice and healthcare fraud. 

From 2009 to 2018, Mr. McInnis and others submitted more than $150 million in false and fraudulent claims for healthcare services. The claims were submitted through Merida Group, a hospice company with dozens of locations in Texas. 

Mr. McInnis was CEO of Merida. He had no medical training but acted as the director of nursing for the company. He also enforced a companywide practice of falsifying medical records to conceal the scheme and ordered employees to change medical records to make it appear patients were terminally ill. 

Mr. McInnis also paid bribes to physicians to certify unqualified patients for home health and hospice. 

Mr. McInnis was sentenced less than two months after the owner of Merida Group, Rodney Mesquias, was sentenced to 20 years in prison and ordered to pay $120 million in restitution. 

7 plead guilty in $931M telemedicine fraud scheme

Telemedicine owners charged in million dollars' worth fraud scheme | My  Front Page Investigative Reports

The owner of two pharmacies and a management company in Florida pleaded guilty Jan. 25 to his role in a $931 million healthcare fraud scheme. He is the seventh defendant to plead guilty in the scheme, according to the U.S. Justice Department

Larry Smith pleaded guilty to conspiracy to commit healthcare fraud, and his sentencing is set for Oct. 25. In his written plea agreement, Mr. Smith admitted to conspiring with others to defraud pharmacy benefit managers into paying for fraudulent prescriptions. As part of the plea agreement, Mr. Smith agreed to pay restitution of $24.9 million and forfeit approximately $3.1 million.

An indictment charged Mr. Smith and others with a nationwide conspiracy to defraud pharmacy benefit managers by submitting $931.4 million in bills for fraudulent prescriptions purchased from a telemarketing company. After improperly soliciting patient information, the marketing companies received approvals through telemedicine prescribers then sold the prescriptions to pharmacies in exchange for kickbacks, said Derrick Jackson, special agent in charge at HHS’ Office of Inspector General in Atlanta. 

In September 2018, HealthRight, a telemedicine company, and its CEO Scott Roix pleaded guilty to conspiracy to commit healthcare fraud for their roles in the scheme. They agreed to pay $5 million in restitution. Mr. Roix’s sentencing is scheduled for Oct. 25. 

Mihir Taneja, Arun Kapoor, Maikel Bolos and Sterling-Knight Pharmaceuticals also pleaded guilty in December 2020, according to the Justice Department.