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Lack of Medical Necessity

This archive displays posts tagged as relevant to fraud arising from medically unnecessary healthcare services. You may also be interested in our pages:

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August 11, 2022

Spivack, Inc., formerly operating as Verree Pharmacy, and owner-pharmacist Mitchell Spivack, have agreed to pay over $4.1 million in civil penalties for dispensing opioids despite numerous red flags the drugs were being diverted—all in violation of the False Claims Act and the Controlled Substances Act. In furtherance of the fraud, Spivack made false statements to drug distributors to maintain the façade of legitimacy, while concurrently drawing millions from the pharmacy and harming the public. In addition to their opioid fraud, Spivack and Verree effectuated their “Bill But Don’t Fill” scheme, where they would enter “BBDF” in their internal computer system, and would submit false claims to insurers for drugs not actually dispensed. USAO EDPA

August 5, 2022

Gonzaga Interventional Pain Management, Melvin Gonzaga, M.D., and his son Rommel Gonzaga will pay $980,000 for violating the False Claims Act by submitting claims for medically unnecessary urine drug tests. GIPM required patients to submit a UDT sample before being seen by a provider and discussing the results from any prior UDT the patient received. Regardless of the patients’ individualized testing needs, GIPM always opted for the more complex “definitive” UDT rather than the lower-level “presumptive” UDT, netting a higher reimbursement rate from the US government. USAO MD

August 3, 2022

Dunn Meadow LLC dba Dunn Meadow Pharmacy, pleaded guilty to illegally distributing prescription fentanyl and paying kickbacks to healthcare providers, in violation of the False Claims Act and the Controlled Substances Act. From 2015 through 2019, Dunn Meadow filled prescriptions not written for a legitimate medical purpose, including those for patients exhibiting suspicious drug-seeking behavior (i.e., requesting prescriptions be sent to suspicious or inappropriate locations including hotels, casinos, and elementary schools). These actions caused a $4.5 million loss to the federal government. Dunn Meadow will pay up to $50 million over the next five years to resolve its civil liability if it generates future revenue. USAO NJ

July 27, 2022

ca Glenn Pair and Markuetric Stringfellow will spend 70 and 78 months in prison, respectively, and pay over $5 million each in restitution for defrauding three States’ Medicaid programs of more than $5 million, and for receiving $1.8 million in kickbacks from participating laboratories. The two owned and operated Do-It-4-The Hood Corporation in North Carolina and later expanded to Georgia. They targeted Medicare-eligible children, enrolled them in their programs, and required them to submit urine specimens for drug testing. Drug testing was in turn billed to Medicaid by complicit laboratories, who then paid kickbacks after receiving Medicaid reimbursement. Through their Wrights Care Services LLC franchise in South Carolina, the two filed fraudulent Medicaid claims for mental health counseling, going so far as to host a “note party,” upon learning of a Medicare audit of Wrights Care, to cover up their scheme by creating false billing records to substantiate their fraudulent Medicaid claims. USAO WDNC, USAO SC

July 22, 2022

Metric Lab Services, LLC, Metric Management Services LLC, Spectrum Diagnostic Labs LLC, and two of their owners, Sherman Kennerson and Jeffrey Madison, will pay $5.7 million to resolve allegations of False Claims Act violations. In their genetic testing fraud scheme, Metric and Spectrum paid kickbacks to certain marketers who solicited generic testing samples from Medicare beneficiaries, with false physician attestations that the testing was medically necessary. Kennerson and Madison both pled guilty to one count of conspiracy to defraud the U.S. and are currently awaiting sentencing. DOJ, NJ USAO

July 20, 2022

Texas-based clinical laboratory Inform Diagnostics, Inc., formerly known as Miraca Life Sciences, Inc., has agreed to pay $16 million to resolve allegations of violating the False Claims Act.  Inform admitted that it had a policy of conducting additional tests on biopsy specimens without an individualized determination on whether additional tests were medically necessary, then submitting bills for those unauthorized and unnecessary tests to Medicare and other federal healthcare programs.  USAO MA

June 16, 2022

A Florida man who was convicted of defrauding Medicare of over $20 million and evading taxes has been sentenced to 14 years in prison and ordered to pay $4 million in restitution to the IRS.  As the owner and operator of multiple telemarking and telemedicine companies, Marc Sporn marketed and sold signed prescription orders for medically unnecessary genetic tests, in exchange for illegal kickbacks from pharmacies and laboratories.  USAO SDFL

June 3, 2022

Rodney L. Yentzer will pay $900,000 for violating the False Claims Act. Through Pain Medicine of York, a group of clinics he controlled, Yentzer caused the submission of false claims for payment to Medicare for urine drug tests that were not medically reasonable or necessary and were not used to aid in the diagnosis and treatment of patients. He is excluded from participation in all federal health care programs for 22 years. In March of 2022, Yentzer pleaded guilty to Health Care Fraud, Money Laundering, and Theft of Public Money for defrauding Medicare, Medicaid, and the U.S. Department of Health and Human Services between 2016 and 2020. USAO MDPA

May 18, 2022

Pat Truglia will spend 120 months in prison, forfeit over $9.4 million, and will pay restitution of $33.7 million for conspiring to defraud Medicare, TRICARE, and CHAMPVA, among others, of approximately $50 million through their fraudulent billing scheme. The scheme involved offering, paying, soliciting, and receiving kickback for durable medical equipment—in this case, braces. Truglia and his conspirators obtained DME orders for Medicare and other federal healthcare program beneficiaries by running multiple call centers, which paid kickbacks and bribes to telemedicine companies, who then paid doctors to write medically unnecessary orders. The orders were filled by Truglia’s companies, who then fraudulently billed the healthcare programs. USAO NJ

April 28, 2022

Donald Woo Lee, a California-based doctor who recruited Medicare beneficiaries to his clinics, falsely diagnosed them and provided them with medically unnecessary procedures, and then submitted upcoded bills for those procedures to Medicare, has been sentenced to nearly 8 years in prison after being found guilty of seven counts of healthcare fraud.  In addition to submitting approximately $12 million in false claims to Medicare, for which he received $4.5 million in reimbursement, Lee also repackaged and reused single-use catheters on his patients.  DOJ
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