Archive

December 16, 2015

Amer Ehsan, the owner and operator of Detroit-area home health care agency Advance Home Health Care Services Inc., was sentenced to 80 months in prison for conspiring with physicians, physical therapists and patient recruiters to bill Medicare for unnecessary home health care and therapy services and paying kickbacks to physicians for referrals.  Ehsan also admitted that he owned and controlled Michigan Rehab and Management Services LLC, which he used to sell information about Medicare beneficiaries and corresponding fictitious patient files to other Detroit-area home health care agencies.  DOJ

December 16, 2015

Louisiana doctors Barbara Smith and Roy Berkowitz and registered nurse Beverley Breaux were sentenced to 80 months, 64 months and 50 months in prison, and to pay $9,484,939, $4,952,816 and $2,057,179 in restitution, respectively, for their roles at the center of a $50 million health care fraud scheme.  Specifically, Smith and Berkowitz falsely certified that thousands of Medicare recipients were homebound and required nursing or therapy services to be provided in their homes, and Breaux falsely certified that these patients were homebound and falsely claimed to have treated patients she had not seen.  DOJ

December 16, 2015

Qualitest Pharmaceuticals, the company’s corporate shell, Vintage Pharmaceuticals, its parent Endo Pharmaceuticals, and seven of their affiliates, agreed to pay $39 million to 48 states and the federal government to settle charges they violated federal and state False Claims Acts by selling understrength chewable fluoride tablets.  As part of the settlement, Qualitest admitted the drug labeling for its chewable fluoride tablets represented fluoride amounts in line with guidelines of the American Dental Association and the American Academy of Pediatrics when in reality it used less than half of these represented amounts.  The allegations were first raised in a whistleblower lawsuit brought Dr. Stephan Porter under the qui tam provisions of the False Claims Act.  He will receive a whistleblower award of roughly $4.71 million from the proceeds of the government’s recovery.  Whistleblower Insider, NY, NH

December 7, 2015

The former owner, operator and managers of Southern California ambulance company ProMed Medical Transportation were sentenced to prison for their role in a fraud scheme that resulted in more than $1.5 million in fraudulent claims to Medicare.  Yaroslav Proshak (aka Steven Proshak) was sentenced to serve 108 months in prison.  On December 2, Emilia Zverev and Sharetta Michelle Wallace were sentenced to serve 36 and 24 months, respectively.  In addition, Zverev and Wallace were ordered to pay restitution jointly and severally with Proshak in the amount of $804,755.  The evidence at trial showed that the defendants conspired to bill Medicare for ambulance transportation services for individuals that did not need such services.  The defendants also instructed ProMed EMTs to conceal the patients’ true medical conditions by altering paperwork and creating fraudulent documents to justify the services.  DOJ

December 1, 2015

Wisconsin-based Pharmasan Labs, Inc., its related billing company NeuroScience, Inc. and their founders, Gottfried and Mieke Kellermann, agreed to pay $8.5 million to resolve charges they violated the False Claims Act by (i) submitting false information for laboratory services, and (ii) violating Medicare rules for services referred by non-physician practitioners.  According to the government, and as admitted by Pharmasan under the settlement, Pharmasan falsely billed Medicare for ineligible food sensitivity testing; knew Medicare prohibited payment for such testing; and submitted false information to Medicare to disguise the type of test it was performing so Medicare would cover it.  Pharmasan also admitted violating Medicare billing rules which bar payment for lab services referred by non-physicians.  The government investigation leading to the settlement originated from a whistleblower action filed under the qui tam provisions of the False Claims Act.  The whistleblower will receive a whistleblower award of roughly $1.1 million from the government’s recovery.  Whistleblower Insider

November 30, 2015

Piedmont Pathology Associates, Inc. and Piedmont Pathology, P.C., a North Carolina-based diagnostic anatomic pathology group agreed to pay $500,000 to settle allegations it violated the False Claims Act and Anti-Kickback Statute by engaging in improper financial relationships with referring physicians.  The allegations first arose in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by a former contract salesperson for the practice who witnessed a program where the practice would provide Electronic Medical Record software licenses to various physicians’ practices in exchange for referrals.  The whistleblower will receive a whistleblower award of $75,000 out of the proceeds of the government’s recovery.  DOJ(NC)

November 30, 2015

Texas-based Regent Management Services L.P. agreed to pay roughly $3.2 million to settle charges it violated the False Claims Act and Anti-Kickback Statute by receiving kickbacks from various ambulance companies in exchange for rights to Regent’s more lucrative Medicare and Medicaid transport referrals.  The settlement is believed to be the first to hold accountable medical institutions (hospitals and skilled nursing facilities) rather than ambulance companies for these kind of ambulance “swapping” arrangements.  DOJ (SDTX)

November 25, 2015

The US settled for more than $30 million allegations against several Florida compound pharmacies and their owners for violating the False Claims Act by fraudulently billing TRICARE, the military’s healthcare program.  The settling defendants and their respective settlements include: MedMatch Pharmacy (agreeing to pay more than $4.7 million to resolve concerns that it paid kickbacks to marketers, that it filled prescriptions it knew or should have known were not legitimate, and that it sent prescriptions to states in which it did not have a valid license); OHM Pharmacy (agreeing to pay $4.1 million to resolve allegations of filling prescriptions from a doctor who was writing them outside the ordinary course of practice); WELL Health Pharmacy and its owner (agreeing to pay more than $3 million, as well as 50% of its net profits for five years, for filling prescriptions written by referral sources that had a financial interest in the prescriptions); Topical Specialists (agreeing to pay more than $2.2 million for submitting prescriptions that were tainted by so-called “research fees,” which was an elaborate guise for paying physicians to write prescriptions); Durbin Pharmacy (agreeing to pay $2.1 million, plus 50% of its net profits for five years, for submitting prescriptions that were tainted by kickbacks); and North Beaches Pharmacy (agreeing to pay $10,000, plus 50% of its net profits for five years, for filling compound prescriptions that the government contends were tainted by illegal kickbacks).  DOJ (MDFL)

November 24, 2015

The former CFO of Long Beach, California-based Pacific Hospital, two orthopedic surgeons and two others have been charged in long-running health care fraud schemes that illegally referred thousands of patients for spinal surgeries and generated nearly $600 million in fraudulent billings.  The wide-ranging kickback scheme, which involved dozens of surgeons, orthopedic specialists, chiropractors, marketers and other medical professionals, involved improper referrals to Pacific Hospital and Hawaiian Hospital.  The most recent targets of the government’s investigation, all of whom have agreed to plead guilty, include: former Pacific Hospital CFO James L. Canedo; orthopedic surgeons Philip Sobol and Mitchell Cohen; chiropractor Alan Ivar; and health care marketer Paul Richard Randall, previously affiliated with Pacific Hospital and Tri-City Regional Medical Center in Hawaiian Gardens.  Under the terms of their plea agreements, Sobol faces a federal prison term of up to 10 years; Canedo, Ivar and Randall face up to five years in prison; and Cohen faces up to three years in prison.  All of them will be required to pay restitution to the victims of the scheme, which in Canedo’s case will be at least $20 million.  Whistleblower Insider

November 20, 2015

Novartis Pharmaceuticals Corp. agreed to pay $390 million to resolve charges it gave kickbacks to specialty pharmacies in return for recommending two of its drugs, Exjade and Myfortic.  The settlement follows the January 2014 and April 2015 settlements of specialty pharmacies Bioscrip, Inc. and Accredo Health Group under which the pharmacies agreed to pay a total of $75 million to resolve False Claims Act charges based on the same allegations.  That brings to $465 million the total government recovery from this alleged kickback scheme.  The allegations leading to the settlement were first brought to the attention of federal law enforcement by David Kester, who filed a whistleblower lawsuit under the qui tam provisions of the False Claims Act.  He will receive a yet-to-be disclosed whistleblower award from the government’s recovery.  Whistleblower Insider