Medicaid

May 9, 2022

Prism Behavioral Solutions has agreed to pay $650,000 to resolve allegations of violating the federal and California False Claims Acts by billing California’s Medicaid program for services not provided to autistic children and young adults.  The whistleblower in this case, Diana Mason, is a behavioral analyst employed by Prism, and will receive a $170,000 share of the settlement.  USAO SDCA; CA AG

April 27, 2022

The owner and operator of two Texas-based adult day care centers has been sentenced to 5 years in prison and ordered to pay $1.8 million in restitution after she was found to have billed the Texas Medicaid Program for items and services not provided.  Scherry Lynn Moses ran Scherry’s Adult Day Activity Center and New Creation Residential Care Homes, a room and board for Social Security recipients, but inconsistently provided boarders with basic needs.  USAO WDTX

April 21, 2022

Susan H. Poon, 57, will spend 70 months in federal prison, and will pay nearly $1.4 million in restitution for a scheme spanning over 3 years, and which resulted in approximately $2.2 million in fraudulent billings. Poon submitted prescriptions both with PII obtained at health fairs held by Costco and UPS, and by soliciting information from actual patients about their dependents—dependents whom Poon never saw or treated. Poon used the stolen PII to submit fraudulent durable medical equipment prescriptions to a DME manufacturer, who then unknowingly submitted false claims for reimbursement to a health insurer. In addition to the prison sentence and the owed restitution, Poon’s chiropractic license was revoked in 2019. USAO CDCA

April 13, 2022

Pharmacy owner Aleah Mohammed was sentenced to 78 months in prison for stealing more than $6.5 million from the government via her prescription fraud on Medicare and Medicaid drug plans. Mohammad submitted claims for drugs that weren’t dispensed, weren’t prescribed as claimed, were not medically necessary, or that were dispensed while the pharmacy was no longer registered with the State of New York. The proceeds were used by Mohammed and her family members to buy luxury vehicles, jewelry, and properties in Queens and Pocono Pines, Pennsylvania. USAO EDNY

April 12, 2022

Physician Partners of America LLC (PPOA), its founder Rodolfo Gari, and its former chief medical officer Dr. Abraham Rivera, have agreed to pay $24.5 million to settle allegations of violating the Stark Law, False Claims Act, and Financial Institutions Reform, Recovery and Enforcement Act (FIRREA).  The settlement resolved claims by whistleblowers Donald Haight, Dawn Baker, Dr. Harold Cho, Dr. Venus Dookwah-Roberts, and Dr. Michael Lupi, all currently or formerly employed with PPOA.  According to the whistleblowers and the government, PPOA allegedly billed Medicare and Medicaid for medically unnecessary testing, paid illegal kickbacks to its physician employees, and made false statements on a loan from the Paycheck Protection Program.  USAO MDFL

April 6, 2022

Florida hospital chain BayCare Health System Inc. will pay $20 million to resolve claims that the company knowingly caused false claims for federal Medicaid matching funds to be submitted to the United States by making improper, non-bona fide cash donations to the Juvenile Welfare Board of Pinellas County (JWB) knowing that the funds would be transferred by JWB to the State of Florida’s Agency for Health Care Administration for Florida’s Medicaid Program, which would trigger a corresponding federal matching payment.  The prohibition on non-bona fide donations ensures that states are paying a share of Medicaid payments; the non-bona fide donations increased Medicaid payments received by BayCare without any actual expenditure of state or local funds and enabled BayCare to recoup its original donations to JWB and also receive federal matching funds. The case was initiated with a qui tam complaint filed by Larry Bomar, who will receive $5 million as an award for initiating the whistleblower action. DOJ; MD FL

March 24, 2022

A New York woman who defrauded the state out of millions of dollars has been sentenced to 3 to 9 years in prison and ordered to pay more than $4 million in restitution.  According to the Attorney General’s Office, Leslie Montgomery lured low-income New Yorkers to Health Living Community Center under the guise of helping them find housing, then used their information to submit false claims to a Medicaid-funded managed care organization.  The claims for custom-molded back braces were medically unnecessary and not requested by or provided to the intended recipients.  Montgomery then hid the illegal proceeds through multiple shell companies, including LCM Livery P/U, Inc.  NY AG

March 8, 2022

Eugene Sisco, III of Kentucky, the owner and operator of several medication assisted treatment (MAT) clinics for opioid addiction, has been sentenced to over 10 years in prison and ordered to pay $5.7 million in restitution, after being convicted of healthcare fraud.  Sisco was found to have tricked Medicaid patients into paying hundreds of dollars in cash each month for MAT services which he later billed and was reimbursed by Medicaid for.  Sisco’s laboratory, Toxperts, LLC, was also found to have billed Medicare for medically unnecessary urine drug tests, causing a loss of over $2 million to CMS.  USAO EDKY

March 7, 2022

Pharmaceutical company Mallinckrodt ARD LLC will pay $260 million to resolve allegations that it violated the False Claims Act in the sale and marketing of its drug H.P. Acthar Gel.  The government intervened in whistleblower actions alleging that Mallinckrodt and its predecessor Questcor Pharmaceuticals Inc. knowingly underpaid state Medicaid programs by improperly calculating amounts it owed under the Medicaid Drug Rebate Program, and unlawfully used a foundation as a conduit to subsidize co-payments.  With respect to the Medicaid rebate claims, which represent $234.7 million of the settlement, defendants were alleged to have calculated rebate amounts as if Acthar was a “new drug” first marketed in 2013, rather than a drug that had been approved since 1952.  By using 2013 for Acthar’s Base Date Average Manufacturer Price (AMP), the company ignored price increases prior to 2013 and fraudulently reduced Acthar drug rebates.  With respect to the copayment fraud claims, which represent $26.3 million of the settlement, defendants were alleged to have violated the Anti-Kickback Statute by subsidizing copayments through payments to three funds that Mallinckrodt had a foundation set up to induce Medicare-reimbursed purchases of Acthar, using the subsidies to counteract doctor and patient concerns about the drug’s high cost.  The whistleblower in the Medicaid rebate case, James Landolt will receive an award of $24.7 million, representing 20% of the $123.6 million federal share of that settlement; the relator’s share for the state share of the settlement was not announced.  The whistleblowers in the copayment case, Charles Strunck and Lisa Pratta, will receive an award of $4.9 million, representing 19% of that settlement.  The settlement includes a five-year corporate integrity agreement (CIA) with monitoring provisions.  DOJ; USAO MA; USAO EDPA