Anti-Kickback and Stark

September 15, 2017

Valentina Kovalienko, the owner of Brooklyn medical clinics Prime Care on the Bay LLC and Bensonhurst Mega Medical Care P.C. was sentenced to 84 months in prison and ordered to forfeit roughly $29 million for her role in a $55 million health care fraud scheme.  As part of her guilty plea, Kovalienko acknowledged that her co-conspirators paid cash kickbacks to patients to induce them to attend her two clinics.  She also admitted submitting false and fraudulent claims to Medicare and Medicaid for services that were induced by prohibited kickback payments to patients or that were unlawfully rendered by unlicensed staff. DOJ

September 13, 2017

MediSys Health Network Inc., which owns and operates the two Queens hospitals Jamaica Hospital Medical Center and Flushing Hospital and Medical Center agreed to pay $4 million to settle allegations that it violated the False Claims Act by engaging in improper financial relationships with referring physicians.  These relationships took the form of compensation and office lease arrangements that did not comply with the requirements of the Stark Law, which restricts the financial relationships that hospitals may have with doctors who refer patients to them.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by Dr. Satish Deshpande.  Dr. Deshpande will receive a whistleblower award of $600,000 from the proceeds of the government's recovery. DOJ

September 11, 2017

Family Medicine Centers of South Carolina LLC agreed to pay $1.56 million, and the company's principal owner and former CEO Dr. Stephen F. Serbin and its former Laboratory Director Victoria Serbin, agreed to pay $443,000 to settle charges they violated the False Claims Act and Stark Law.  Specifically, the government alleged FMC’s incentive compensation plan improperly paid FMC’s physicians a percentage of the value of laboratory and other diagnostic tests that they personally ordered through FMC.  Dr. Serbin allegedly initiated this program and reminded FMC’s physicians that they needed to order tests and other services through FMC in order to increase FMC’s profits and to ensure that their take-home pay remained in the upper level nationwide for family practice doctors.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by former FMC physician Dr. Catherine A. Schaefer.  She will receive a whistleblower award of $340,510 from the proceeds of the government's recovery. DOJ

September 5, 2017

Tennessee-based affiliated home health entities Home Health Care of East Tennessee, Inc.; Home Health Care of West Tennessee, Inc.; Home Health Care Services, Inc.; Home Health Care Services II, Inc.; Health Care Staffing of Tennessee, Inc.; and Home Health Care Support Services, Inc. agreed to pay $1.8 million to settle charges of violating the False Claims Act and Stark Law for billing Medicare for home health and hospice services not properly payable due to compensation or other financial arrangements with certain referring physicians. DOJ (EDTN)

August 23, 2017

US Bioservices Corp. agreed to pay $13.4 million to settle charges it violated the False Claims Act and Anti-Kickback Statute by participating in a kickback scheme with Novartis Pharmaceuticals Corp. relating to the Novartis drug Exjade.  Specifically, the government alleges US Bio was promised additional patient referrals and related benefits in return for refilling a higher percentage of Exjade than the two other pharmacies that also dispensed Exjade.  DOJ (SDNY)