Medicare

January 13, 2017

Massachusetts-based ambulance company Medstar Ambulance Inc., including four subsidiary companies and its two owners, Nicholas and Gregory Melehov, agreed to pay $12.7 million to resolve allegations that they violated the False Claims Act by submitting false claims to Medicare for ambulance transport services. According to the government, Medstar routinely billed for services that did not qualify for reimbursement because the transports were not medically reasonable and necessary, billed for higher levels of services than were required by patients’ conditions, and billed for higher levels of services than were actually provided. The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by Dale Meehan, a former employee in Medstar’s billing office. Mr. Meehan will receive a whistleblower award of roughly $3.5 million. DOJ

January 12, 2017

Idia Oriakhi, the administrator of five Houston-area home health agencies, pleaded guilty to conspiring to defraud the State of Texas’ Medicaid-funded Home and Community-Based Service and the Primary Home Care Programs of more than $7.8 million. Oriakhi’s parents owned and operated Aabraham Blessings, LLC; Baptist Home Care Providers, Inc.; Community Wide Home Health, Inc.; Four Seasons Home Healthcare, Inc. and Kis Med Concepts, Inc. and admitted that she, her father Godwin Oriakhi and others obtained patients for her family’s home health agencies by paying illegal kickback payments to patient recruiters and physicians for referring and certifying Medicaid patients for services not medically necessary and often not provided. DOJ

$2.6 Million Whistleblower Settlement With Bay Sleep Clinic

The clinic will settle whistleblower allegations of using unlicensed technicians and unapproved locations and of doctor kickback referrals. Constantine Cannon LLP is pleased to announce a $2.6 million settlement on behalf of its client for whistleblower allegations against Bay Sleep Clinic. The settlement was announced by the United States government on December 28, 2016, against Bay Sleep Clinic, which currently operates 20 locations throughout northern California; its related Qualium Corporation and Amerimed Corporation businesses; and owners and operators Anooshiravan Mostowfipour and Tara Nader. The “qui tam,” or whistleblower, lawsuit alleged that the defendants fraudulently billed Medicare for sleep studies conducted by unlicensed individuals in unapproved locations; improperly dispensed durable medical equipment from unapproved locations using unlicensed technicians; and paid doctors for referrals in violation of the federal Anti-Kickback Statute. The defendants neither admitted nor denied liability. The whistleblower, Elma F. Dresser, is a former Bay Sleep Clinic employee who worked as a sleep technician and marketer for eight years. Through her various roles at the company, Ms. Dresser became familiar with the defendants’ alleged scheme to bilk money from Medicare. She filed her suit in 2012, leading the government to investigate the claims and join the case. Ms. Dresser was represented by Eric R. Havian, partner and attorney, Jessica T. Moore, partner and attorney, Anne Hayes Hartman, partner and attorney, Hallie Noecker, attorney, and Sarah Poppy Alexander, attorney of Constantine Cannon’s whistleblower practice in San Francisco, along with co-counsel from the Law Office of William C. Dresser. “It’s rewarding to see the alleged fraudsters held responsible. Because of the close cooperation and work between the whistleblower and the government, we were able to recover significant funds for the government,” said Anne Hayes Hartman, co-lead counsel on the case. “It is gratifying to represent people like Elma Dresser, who bravely stepped forward with knowledge of her employer’s wrongdoing. Many do not appreciate the risks whistleblowers face to hold alleged wrongdoers accountable.” “Sleep studies are a quickly expanding medical field,” said Jessica T. Moore, who served as co- lead counsel on the case. “Ensuring the safety of these procedures should be a top priority of the government for all patients, Medicare and otherwise.” The federal False Claims Act allows whistleblowers to sue companies that are defrauding the government and receive a reward if the government recovers any funds as a result. The government may choose to intervene in the lawsuit, as it has done in this case. The False Claims Act is one of the government’s most effective weapons in combatting fraud, waste, and abuse by those who contract with the government. Healthcare fraud alone is estimated to cost the U.S. billions of dollars. Such fraud can be difficult to discern without access to inside information; well-placed whistleblowers are necessary to provide the information the government might otherwise lack to help stop these practices.

January 6, 2017

Constantine Cannon Announces a $2.6 Million Whistleblower Settlement With Bay Sleep Clinic.  Click here for the press release.

December 28, 2016

Bay Sleep Clinic, its related businesses -- Qualium Corporation and Amerimed Corporation -- and their owners and operators, Anooshiravan Mostowfipour and Tara Nader, agreed to pay $2.6 million to settle allegations they fraudulently charged Medicare for diagnostic sleep tests and medical devices in violation of Medicare payment rules. The allegations originated in a whistleblower lawsuit filed by Elma F. Dresser under the qui tam provisions of the False Claims Act. She will receive a whistleblower award of approximately $545,000 from the proceeds of the government's recovery. DOJ (NDCA)