A North Carolina physician assistant was sentenced to prison on October 4 for his role in a $10 million Medicare fraud scheme involving genetic testing. He was sentenced to 72 months in prison and ordered to pay over $3.6 million in restitution. Last June, a federal jury convicted him of healthcare fraud and making false statements related to healthcare matters.
During the sentencing hearing, evidence revealed that in 2018 and 2019 the defendant worked as an independent contractor for a physician staffing and telemedicine company in the Charlotte area. He signed fraudulent prescriptions for medically unnecessary genetic tests, specifically cancer genomic and pharmacogenetic testing, for over 600 Medicare beneficiaries residing in North Carolina. He had never met, seen, or treated the beneficiaries, and only had brief telephone conversations with them or no interactions at all.
According to court records, the defendant received from the telemedicine company and its clients pre-populated prescription forms and related records for patients who were pre-selected for genetic testing, which he then electronically signed and returned, in exchange for $12—and later $15—for each purported consultation that he performed.
To hide the fact that he was not the treating physician and had not conducted evaluations, he falsified medical records and falsely certified that the genetic tests were medically necessary. His fraudulent actions led to more than $10 million in reimbursement claims submitted to Medicare, resulting in over $3.6 million in payments.
The defendant will report to the Federal Bureau of Prisons upon designation of a federal facility. The investigation was carried out by the Federal Bureau of Investigation (FBI) in Charlotte and the Department of Health and Human Services (HHS), Office of Inspector General (OIG).
Compliance Perspective
Issue
The OIG has conducted dozens of investigations of fraud schemes involving companies and individuals that purported to provide telehealth, telemedicine, or telemarketing services and exploited the growing acceptance and use of telehealth. These schemes raise fraud concerns because of the potential for considerable harm to federal healthcare programs and their beneficiaries, which may include: (1) an inappropriate increase in costs to federal healthcare programs for medically unnecessary items and services and, in some instances, items and services a beneficiary never receives; (2) potential to harm beneficiaries by, for example, providing medically unnecessary care, items that could harm a patient, or improperly delaying needed care; and (3) corruption of medical decision-making. Practitioner arrangements with telemedicine companies may also lead to criminal, civil, or administrative liability under federal laws including, for example, the federal anti-kickback statute, OIG’s exclusion authority related to kickbacks, the Civil Monetary Penalties Law provision for kickbacks, the criminal healthcare fraud statute, and the False Claims Act.
Discussion Points
- Review policies and procedures regarding the use of telemedicine within the facility and preventing fraud, waste, and abuse. Also review your policies and procedures for operating an effective compliance and ethics program to ensure that the identifying and reporting of false claims or kickbacks is part of your policy.
- Provide education to nursing and business office personnel on their responsibility to identify and report any concerns that unnecessary medications, treatments, supplies, or equipment are being ordered for residents. Train staff about fraud, waste, and abuse and the prohibition regarding acceptance of illegal kickbacks and bribes in exchange for ordering medical equipment, performing lab tests, prescribing medications, and other activities. Staff who observe or reasonably suspect that kickbacks and bribes are being offered or accepted should report such suspicions to their supervisor or through the facility’s Hotline.
- Conduct regular audits to ensure appropriate use of telemedicine tools and verify that staff are not involved in bribery or kickbacks. Also, assess staff awareness of their responsibility to report compliance and ethics concerns to their supervisor, the compliance and ethics officer, or via the anonymous hotline.
*This news alert has been prepared by Med-Net Concepts, Inc. for informational purposes only and is not intended to provide legal advice.*
