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Other Government Health Programs

This archive displays posts tagged as relevant to government healthcare programs other than Medicare and Medicaid, and fraud in those programs. You may also be interested in our pages:

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January 22, 2021

The estate of Dr. Patrick T. Hunter has agreed to pay more than $1.7 million to resolve allegations that the urologist, who passed away in 2019, submitted false claims to Medicare and TRICARE for medically unnecessary procedures and received improper payments for them from the Orlando Center for Outpatient Surgery.  Between 2010 and 2016, Dr. Hunter allegedly performed the lithotripsy procedures, which break up kidney stones, on patients who either did not have kidney stones or were not medically indicated for them.  For initiating the successful qui tam suit, whistleblower Scott Thompson will receive a relator’s share of $385,000.  USAO MDFL

January 15, 2021

The co-owner of multiple compounding pharmacies and pharmaceutical distributors in Mississippi has been sentenced to 18 years in prison and ordered to pay over $287 million in restitution and over $56 million in forfeiture after pleading guilty to healthcare fraud and money laundering.  As part of his guilty plea, Wade Ashley Walters admitted to being the mastermind behind a four-year scheme that defrauded TRICARE and private health benefit programs of over $287 million.  To perpetuate the fraud, Walters and his co-conspirators solicited and paid recruiters to procure prescriptions for highly reimbursed compounded medications, solicited and paid physicians to authorize prescriptions for same, adjusted prescription formulas to ensure the highest reimbursement possible, and improperly waived or reduced mandatory beneficiary copayments.  USAO SDMS

December 31, 2020

Department of Veterans Affairs contractor TriWest Healthcare Alliance Corp. has agreed to pay $179.7 million to resolve allegations that it improperly retained overpayments received from the VA.  TriWest administered portions of VA’s former Veterans Choice Program and its Patient-Centered Community Care Program (PC3), which enable veterans to obtain VA-paid healthcare from private providers.  At times, VA allegedly paid TriWest twice for the same services, or paid for services for which TriWest received full or partial reimbursement from other healthcare providers, and TriWest failed to return those overpayments.  DOJ

December 4, 2020

Joint Active Systems, Inc. (JAS), a durable medical equipment manufacturer, and New England Orthotics & Prosthetics, LLP (NEOPS) have agreed to pay $1.59 million and $90,000 respectively to resolve allegations of defrauding multiple federal healthcare programsincluding TRICARE, Medicare, and Medicaid programs in Connecticut, Massachusetts, and Rhode Islandthrough a variety of fraudulent schemes.  According to a qui tam suit filed by two former NEOPS employees, JAS allegedly recruited NEOPS to bill Medicare and Medicaid for custom-fabricated orthotics that were not custom-fabricated orthotics, nor medically necessary, and falsely claim that JAS-affiliated sales representatives were properly trained to treat patients during fittings.  Additionally, JAS allegedly overcharged the VA for its devices by as much as 300%.  For blowing the whistle on these fraud schemes, the whistleblowers will receive a 17% share of the settlement proceeds.  USAO MA

November 19, 2020

Johnson & Johnson (J&J) subsidiary Medical Device Business Services, Inc. (MDBS) has agreed to pay $10 million to settle allegations that a former J&J subsidiary, Therakos, Inc., promoted two medical devices for unapproved uses in pediatric patients.  A second entity, The Gores Group (TGG), agreed to pay $1.5 million to settle allegations of continuing to promote the devices for unapproved uses after it acquired Therakos in 2012.  According to qui tam relator Brian McCormick of Ross Feller Casey LLP, between 2006 and 2015, Therakos improperly promoted its extracorporeal photopheresis (ECP) systems, used to treat cutaneous T-cell lymphoma, for use in children despite the fact that no ECP devices had been approved for that population.  In so doing, Therakos allegedly caused false claims to be submitted to Medicaid, the Federal Employee Health Benefits Program, and TRICARE, in violation of the False Claims Act.  USAO EDPA

October 2, 2020

Two New York-based physical therapy providers have agreed to pay $4 million to resolve whistleblower-brought allegations of violating the False Claims Act by improperly billing multiple government healthcare programs, including Medicare, Medicaid, the Federal Employees’ Compensation Act Program (FECA), and the Federal Employees’ Health Benefits Program (FEHBP).  The alleged misconduct by Williamsburg Physical Therapy, P.C., Euro Physical Therapy, P.C., owners Alex and Diana Klurfeld, and management company First Plus Services, Inc. occurred between 2008 to 2018, and involved billing for physical therapy services provided or supervised by someone other than the licensed therapist listed on claims, as well as backdating services after treatment authorizations had expired.  USAO EDNY

August 24, 2020

Following a whistleblower suit by a former sales representative, DUSA Pharmaceuticals (DUSA), a Massachusetts-based subsidiary of Sun Pharmaceuticals Industries Inc. (Sun Pharma), has agreed to pay $20.75 million to resolve allegations of defrauding Medicare and the Federal Employee Health Benefit Pr­­­ogram.  According to relator Aaron Chung, senior management at DUSA and Sun Pharma allegedly encouraged doctors, via paid speaker programs and discussions, to use shorter incubation periods of 1-3 hours for Levulan Kerastick, a topical prescription medication for treating actinic keratosis (AK) of the face and scalp that had FDA-approved instructions for 14-18 hour incubation periods.  As expected, the significantly reduced incubation periods resulted in significantly reduced AK clearance rates, yet DUSA failed to inform doctors of the lower rates and even actively misinformed them that AK clearance rates were the same regardless of incubation period.  For exposing the fraudulent conduct, Chung will receive approximately $3.5 million of the settlement proceeds.  DOJ; USAO WDWA

July 23, 2020

Two pharmacists who were co-owners of Advantage Pharmacy in Mississippi have been sentenced to over 12 years in prison each and ordered to pay between $9 million and $29 million in civil monetary judgment, and between $185 million and $189 million in restitution for committing healthcare fraud.  According to the press release, Glenn Doyle Beach and Hope Thomley marketed, dispensed, and distributed compounded medications without regard to medical necessity, causing various health benefit programs, including TRICARE, to pay over $200 million in reimbursements.  Thomley’s husband, Randy Thomley, has been sentenced to 8 years in prison and ordered to pay judgment and restitution of $3.6 million each for his role in helping to recruit TRICARE beneficiaries.  USAO SDMS

July 23, 2020

Progenity, Inc., f/k/a Ascendant MDx, Inc., has agreed to pay a total of $49 million to resolve allegations that the California-based clinical laboratory submitted false claims to Medicaid, the VA, TRICARE, and the Federal Employees Health Benefits Program (FEHBP) through different fraudulent schemes.  First, from 2012 to 2016, Progenity allegedly billed the programs for non-reimbursable prenatal tests using a reimbursable billing code.  Second, in claims originally brought by a whistleblower under the False Claims Act, the company was alleged to violate the Anti-Kickback Statue by providing improper incentives to physicians—including paying above fair market value for blood specimen “draw fees”, providing tens of thousands of dollars in free food and alcohol, and routinely reducing or waiving co-insurance or deductibles—in order to induce physicians to order their tests.  Approximately $35.9 million of the settlement proceeds will go toward resolving federal claims, with the remaining $13.1 million paid to different states.  AG NC; USAO SDCA; USAO SDNY

July 10, 2020

Universal Health Services, Inc. and UHS of Delaware, Inc. (collectively, UHS), and a Georgia-based UHS facility, Turning Point Care Center, LLC, have agreed to pay a combined $122 million to settle 18 qui tam cases pending in four jurisdictions.  In violation of the False Claims Act, UHS allegedly billed federal healthcare programs—including Medicare, Medicaid, TRICARE, the Department of Veteran Affairs, and the Federal Employee Health Benefit programs—for medically unnecessary inpatient behavioral health services, failed to provide adequate or appropriate services, and paid illegal inducements to beneficiaries of those programs.  UHS will pay over $88 million to the federal government and nearly $29 million to individual states, for a combined penalty of $117 million, with a relator share of about $15.8 million.  Turning Point will pay $5 million to the federal government and the State of Georgia; the whistleblower in that case will receive $861,853.64.  USAO MDFL; USAO NDGA; USAO EDPA; AG FL; AG MI; AG NC; AG VA
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