HealthExecNews » Fraud & Waste

Hospital executive gets 3 years in prison

rcocchi — Mon, 14 May 2012 10:00:12 +0000

David Rosen, former CEO of MediSys Health Network, the operator of Jamaica Hospital Medical Center, Brookdale University Hospital and Flushing Hospital Medical Center, has been sentenced to three years in prison for bribery.

Rosen pleased guilty to participating in a scheme which involved former state Sen. Carl Kruger (D-Brooklyn), Assemblyman William Boyland Jr., (D-Brooklyn) and the late Assemblyman Anthony Seminerio (D-Richmond Hill). The scheme funneled hundreds of thousands of dollars to the politicians in return for using their influence in Albany to benefit Rosen’s healthcare organization.

At Rosen’s request, he was tried before a judge rather than a jury. After a three-week trial last year, Judge Jed Rakoff found him guilty.

His lawyer, Elkan Abramowitz, argued that Rosen did what he had to do to secure the survival of his hospitals — which served New York’s poor — and that he didn’t ask for any of the money for himself. He also asked the judge to let Rosen off on probation and community service.

The courts probation office recommended a sentence of 10 years.

The NYDailyNews reported that Judge Rakoff said that while he had no doubt Rosen was “a good man in many respects,” the seriousness of the crimes required him to send Rosen to prison. Rakoff added this case was tragic because it showed how someone who had been widely admired and sought to better the health care of poor communities used his position to bribe state legislators.

After serving three years in prison, Rosen will also spend two years under supervised release and is required to pay a $500 special assessment fee.

Rosen maintains his innocence. That’s why Abramowitz told the judge he would be filing an expeditious appeal on Rosen’s behalf.

Kruger resigned and pleaded guilty to corruption charges in December and was sentenced to seven years in prison. Boyland was acquitted, but later arrested on new bribery charges. Seminerio, plead guilty to an earlier case of fraud and died in prison.

What’s your opinion on this case? Share your thoughts in the comments section below.

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Reduce liability for provider-ID theft

rcocchi — Fri, 20 Apr 2012 10:00:33 +0000

Identity theft can be devastating for physicians and the facilities they work for, consuming significant time and substantial financial resources.

Years ago, physicians and their facilities didn’t have to worry all that much about identity theft. But nowadays, it happens more than you may think – unscrupulous individuals acquire providers’ identification and use it to commit fraud.

The good news is, there’s a new way to protect providers from the mayhem identify theft can cause.

The Centers for Medicare & Medicaid Services (CMS) created the provider victim validation/remediation initiative. It assists providers whose ID has been stolen and used to defraud federal healthcare programs.

Program integrity contractors assigned to different regions investigate the situation, after being notified by a potential victim. The American Medical Association (AMA) lists contact information for the contractors on its website.

These contractors investigate providers’ complaints, and generate a report to CMS for a final decision on whether to relieve providers of fraud liability based upon the evidence.

Providers who haven’t suffered any financial liability yet, but suspect they have been an identity theft victim, should contact their Medicare Administrative Contractors (MACs) or the Department of Health and Human Services Office of the Inspector General (800-HHS-TIPS).

In the past many physicians haven’t been able to clear their names and struggled to get their reputation and finances back on track, since there wasn’t an entity to help them. And not being able to clear up bad debts from fraudulent billing had devastating effects.

In addition, this kind of illegal access compromises privacy issues and causes HIPAA violations — something no facility wants to deal with.

Now this new streamlined process gives physicians the help and resources they need when facing a devastating and complicated issue like identity theft.

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Tenet self-discloses over billing, pays Medicare $43M

rcocchi — Tue, 17 Apr 2012 10:00:02 +0000

During a 2007 internal review, Tenet Healthcare Corp.’s compliance department uncovered overpayments at one of its rehabilitation units at a Georgia facility. The company disclosed the overpayments to the government, which led to an investigation and a $42.75 million settlement to Medicare.

This settlement resolves allegations – made under the False Claims Act (FCA) – that Tenet overbilled Medicare for the treatment of patients at inpatient rehabilitation facilities (IRFs).

The allegations stem from admissions at 25 IRFs between May 15, 2005 to Dec. 31, 2007. According to the Justice Department, the Dallas-based hospital operator billed Medicare for patients who didn’t meet the standards for admission to IRFs. And since IRFs are designed for patients who require more intense therapy and closer medical supervision, they get paid more than acute care hospitals or skilled nursing facilities.

This settlement is part of the government’s 2009 Health Care Fraud Prevention and Enforcement Action Team (TEAM) initiative and its effort to reduce and prevent Medicare and Medicaid financial fraud. To date it’s the single largest U.S. recovery involving inappropriate inpatient rehab admissions.

Tenet self-disclosed the overbilling because it was required by the corporate integrity agreement it was operating under.

Tenet officials said they’d already set aside the funds for the settlement, and will pay it in the second quarter.

Under the FCA, the Justice Department has recovered more than $6.6 billion since January 2009 in cases involving fraud against federal healthcare programs.

Currently, Tenet runs 50 hospitals, close to 100 outpatient health centers, but only eight IRFs.

What do you think about the settlement? Is the government making an example of Tenet or is it fair? Share your thought below in the comments box.

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Feds charge Texas doc with $375M Medicare fraud

Carol Katarsky — Thu, 01 Mar 2012 10:00:44 +0000

The feds have filed charges alleging a Texas doctor perpetrated the largest health care fraud in U.S. history. According to the prosecutors, Dr. Jacques Roy ran a complicated Medicare fraud scheme that skimmed $375 million since 2006. In fact, the scope of the fraud was so huge, that industry experts say prosecutors should’ve uncovered the problem much earlier.

One expert estimated a legitimate practice would have to be treating a million patients at 30 locations to justify the kind of billings Roy racked up.

Prosecutors say Roy and his office manager paid so-called recruiters $50 a pop to go door-to-door in neighborhoods, asking the residents to sign off on forms stating the doctor had treated them in their homes. The recruiters also signed up residents at local homeless shelters.

The office manager and the owners of five local home health agencies were also charged in relation to the fraud. Additionally, $2.3 million in payments to 78 other home health agencies were suspended.

Federal officials discovered the fraud through the use of new data analysis tools intended to catch unusual billing practices or trends. For an example of what kinds of data could be a red flag, 99% of doctors have certified 104 or fewer patients for home health care. Roy had certified more than 5,000.

If convicted, Roy faces a maximum sentence of 100 years in prison and a minimum of $18.5 in fines.

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Justice Dept.: 2011 record-setting year for fraud settlements

Carol Katarsky — Thu, 22 Dec 2011 10:00:22 +0000

The Justice Department announced that fiscal year 2011 saw a record amount — more than $3 billion — in settlements and judgments. That’s the second year in a row the department has recovered more than $3 billion in civil fraud cases against the government. Between January 2009 and September 2011 (the end of the ’11 fiscal year) the government recovered a total of $8.7 billion. That’s the largest three-year collection total in the history of the department.

The total for 2011 includes a record $2.8 billion in recoveries under the whistleblower provisions of the False Claims Act, which is the government’s primary civil remedy to redress false claims for federal money or property, such as Medicare benefits, payments on military contracts, and federal subsidies and loans. $2.4 billion of that money came from cases involving fraud against federal health care programs.

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$1M+ embezzlement nets accountant jail time

Carol Katarsky — Thu, 15 Dec 2011 10:00:22 +0000

A hospital accountant is headed to jail after embezzling more than $1 million from her employer’s accounts. Susan J. Morrison, a former accountant at Munson Healthcare in Traverse City, Michigan, was sentenced to 46 months in prison and ordered to pay over $1 million in restitution. She had previously pleaded guilty to wire fraud and money laundering.

According to prosecutors, between October 2007 and April 2011, Morrison transferred funds from Munson’s Regional Healthcare Foundation’s bank account to an account for her former business. She used the money for such necessitates as buying dozens of boxes of trading cards.

Morrison is required to forfeit any funds and goods she acquired from the crime. So far, over $36,000 has already been seized from various bank accounts.

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Annual cost of health data leaks: $6.5 billion

Carol Katarsky — Tue, 06 Dec 2011 10:00:01 +0000

When patient data is breached there’s a cost to patient privacy, but hospitals face a steep cost to their own bottom lines.

According to the second annual study of data breaches among health care organizations by Ponemon Institute, the average annual cost of such leaks is $6.5 billion.

Over the past year, the number of data breaches has increased by 32%. According to responding organizations, the most common cause of such breaches is simple employee negligence and mistakes.

Adding fuel to the fire: The vast majority of health care organizations (80%) don’t monitor mobile devices that can most easily transmit protected information — whether deliberately or accidentally.

A free copy of Ponemon’s 2011 Benchmark Study on Patient Privacy and Data Security can be found here.

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Obama takes action on growing drug shortage crisis

Carol Katarsky — Thu, 03 Nov 2011 10:00:14 +0000

The nationwide shortage of key medications is finally getting some attention from the White House. President Obama just issued an executive order intended to eventually end the shortages of vital medications used to treat cancer and other life-threatening illnesses.

The order instructs the FDA to increase reporting of potential shortages, fast-track the review of applications to start or change production of shortage-related drugs and give information about potential price gouging or collusion to the Justice Department.

So far a record number of drugs — nearly 200 of them — have been declared in an official shortage. Prices have skyrocketed and some hospitals have reported instances of drug scalping and being offered goods that a ppeared to have been stolen and/or dangerously mishandled by third-party vendors.

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Disabled vet blows lid off multi-million dollar Medicaid fraud

Carol Katarsky — Tue, 11 Oct 2011 10:00:18 +0000

For his efforts uncovering a Medicaid fraud that the government couldn’t, the veteran pocketed a $15 million whistle blower payout.

Richard West, a 63-year-old Vietnam vet living in New Jersey knew something was wrong when medical services he needed were being cut back because he had supposedly reached the spending limit. West has muscular dystrophy, is confined to a wheelchair and needs oxygen — but he’s nobody’s fool and knew the numbers didn’t add up.

A little digging into his records showed that Maxim Healthcare had overbilled for hundreds of hours of care he never received, from nurses he’d never met.

West contacted numerous federal agencies who all declined to help him. So he hired his own lawyer and went to court.

When all was said and done, Maxim had agreed to pay the highest financial settlement in history for home healthcare fraud: $121.5 million in reimbursements and penalties, $8.4 million to the Veterans Administration and a fine of $20 million. Under the whistle-blower laws, West gets to keep a cool $15 million of that. He said he plans to use the funds to buy a new van, make some improvements to his home and donate to charities for the disabled. He will however, lose his Medicaid eligibility as his lawyer noted.

What motivated him to keep up the fight? West told a reporter for the New York Post: “The more I uncovered, the more pissed off I got that someone was making money on my disability… From my wheelchair, on a ventilator and oxygen, I have spent the last seven years in this fight. Sometimes the good guy wins.”

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Congress to investigate drug price gouging claims

Carol Katarsky — Fri, 07 Oct 2011 10:00:41 +0000

Rep. Elijah E. Cummings of Maryland has started the ball rolling for a Congressional investigation into allegations of companies price-gouging hospitals in the wake of nationwide shortages of key drugs.

Cummings asked five of the so-called “gray market” companies t o provide information on their sales of drugs that are in short supply nationwide. Cummings is interested in reports that some companies are selling the drugs at dramatic markups of hundreds of times their normal prices — in at least once case, a drug that normally sells for around $26/dose was priced at $1,200/dose. Cummings is a ranking member of the House Committee on Oversight and Government Reform.

So far, one of the five companies is cooperating with the information request.

Aside from being unfair and potentially illegal, the shortages and the questionable supplies that some hospitals are forced to use have raised questions of patient safety.

Cummings’ office has set up a tip line for information on price gouging.

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