Healthcare Fraud

July 27, 2016

The University of Pittsburgh Medical Center, together with the University of Pittsburgh Physicians, UPMC Community Medicine, Inc., and Tri-State Neurosurgical Associates-UPMC, Inc., agreed to pay roughly $2.5 million to settle charges they violated the False Claims Act by submitting false claims to Medicare.  Specifically, the government alleged that certain neurosurgeons employed by UPMC submitted claims for assisting with or supervising surgical procedures performed by other surgeons, residents, fellows, or physician assistants, when those neurosurgeons did not participate in the relevant surgeries to the degree required.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act.  The whistleblowers will receive a yet-to-be-determined whistleblower award from the proceeds of the government's recovery.  DOJ (WDPA)

July 22, 2016

California-based medical device manufacturer Acclarent Inc., a subsidiary of Johnson & Johnson, agreed to pay $18 million to resolve allegations it violated the False Claims Act by causing health care providers to submit false claims to Medicare and other federal health care programs by marketing and distributing its sinus spacer product known as the Relieva Stratus MicroFlow Spacer (Stratus) for use as a drug delivery device without FDA approval of that use.  The government further alleged that Acclarent marketed the Stratus as a drug delivery device even after the FDA rejected the company’s 2007 request to expand the approved uses for the Stratus.  On July 20, Acclarent’s former CEO William Facteau and former VP of Sales Patrick Fabian were convicted of introducing adulterated and misbranded medical devices into interstate commerce.  The allegations originated in a whistleblower lawsuit filed by Melayna Lokosky under the qui tam provisions of the False Claims Act.  The whistleblower will receive an award of roughly $3.5 million from the proceeds of the government's recovery.  DOJ

July 19, 2016

Ann Anyanwu, a registered nurse at Texas-based Medpsych Home Health Care, was convicted for participating in an $8 million Medicare fraud scheme involving fraudulent claims for home-health services.  According to the evidence, Anyanwu and others executed a scheme to submit to Medicare through Medpsych claims for home-health services to patients who did not receive them and did not qualify for them.  DOJ

July 25, 2016

Florida announced the arrests of three individuals for operating a $1 billion Medicare and Medicaid fraud scheme involving numerous Miami-based health care providers. Attorney General Bondi’s MFCU, as part of the HEAT Strike Force, assisted in identifying more than $100 million of Medicaid fraud in connection to this scheme. According to the indictment, Philip Esformes, 47, operated a network of more than 30 skilled nursing homes and assisted living facilities that gave access to thousands of Medicare and Medicaid beneficiaries. Many of these beneficiaries did not qualify for skilled nursing home care or for placement in an assisted living facility. However, Esformes and co-conspirators admitted the beneficiaries to Esformes Network facilities, and received medically unnecessary services billed to Medicare and Medicaid. The defendants also allegedly received kickbacks by steering the beneficiaries to other health care providers, including community mental health centers and home health care providers, who also performed medically unnecessary treatments billed to Medicare and Medicaid. In order to hide the kickbacks from law enforcement, the kickbacks were often paid in cash, or were disguised as payments to charitable donations, payments for services and sham lease payments. FL

June 27, 2016

Ten North Texas companies and individuals agreed to pay $1.125 million to resolve charges they violated the False Claims Act for failing to comply with rules and regulations governing Medicaid transportation services.  The companies include: Irving Holdings, Inc. (together with its predecessor companies Big Tex Taxi Corporation, Terminal Taxi Corporation, Choice Cab, Inc., Yellow Checker Cab of Dallas, Inc., and Yellow Checker Cab of Fort Worth, Inc.); JetTaxi, Inc.; Dallas Taxi, LLC; US Cab, LLC; Terminal Taxi Corporation of Irving; Classic Shuttle Acquisition Corporation, Inc.; and Dallas Car Leasing, LLC.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by Robert Spence, Mike Jones, and Cheryl Jones.  They were employees of Irving Holdings, one of the largest taxicab companies in the US.  They will receive a whistleblower award of $202,500 from the proceeds of the government's recovery.  DOJ (EDTX)

June 23, 2016

New Jersey osteopathic physician Vincent Destasio pleaded guilty to accepting thousands of dollars in exchange for patient referrals to two lab companies that performed blood and DNA testing.  DOJ (DNJ)

June 21, 2016

David Allen and William Timothy Rogers, former pharmacist-in-charge and former president of the now-defunct compounding pharmacy Advanced Specialty Pharmacy (doing business as Meds IV)were sentenced to 12 and 10 months in prison for their roles in the distribution of adulterated drugs.  DOJ

June 13, 2016

Ubert Guillermo Rodriguez, former owner of Florida-based durable medical equipment maker G.R. Services Equipment & Supplies Inc., was sentenced to 37 months in prison and to pay $918,402 in restitution for his role in a multimillion-dollar health care fraud scheme in the greater Tampa, Florida, area.  Rodriguez admitted that from May 2013 through July 2013, his company submitted approximately $2.6 million in fraudulent claims to Medicare seeking reimbursement for durable medical equipment not legitimately prescribed by doctors and not provided to beneficiaries.  DOJ