A Massachusetts psychiatrist was convicted by a federal jury on October 24, 2023, of billing Medicare and private insurance companies for over $11 million in treatments he did not provide and obstructing justice in an attempt to conceal his crimes.
The defendant was a licensed psychiatrist who, among other services, offered transcranial magnetic stimulation (TMS) therapy and psychotherapy to patients suffering from depression. TMS therapy is a noninvasive method of brain stimulation that uses rapidly alternating or pulsed magnetic fields to induce electrical currents directed at a patient’s cerebral cortex.
Between January 2015 and December 2018, the defendant engaged in a variety of fraudulent billing schemes in which he sought and received reimbursement for services he did not render. For example, he billed Medicare and private insurers $10.6 million for thousands of TMS sessions he never provided, including over 8,000 sessions he claimed were provided to 74 patients who, in fact, never received a single session of the therapy. He also billed Medicare and private insurers for hundreds of thousands of dollars’ worth of psychotherapy sessions he never provided, including over 900 face-to-face sessions he falsely claimed he provided while he was on vacation in locations like the Bahamas, Punta Cana, Dominican Republic, and the Czech Republic.
On 382 occasions, the defendant billed Medicare and private insurers for having provided more than 24 hours’ worth of psychotherapy services in a single day, including one day in July 2017 when he claimed he had provided hour-long psychotherapy sessions to 70 different patients—all while outside the United States on vacation.
To further his fraudulent billing scheme, the defendant made numerous false statements to his patients, the billing company with which he worked, and the insurers to whom he submitted claims seeking reimbursement. When Medicare, private insurers, and the Department of Health and Human Services (HHS) sought records from the defendant pertaining to certain of his claims, he took steps to conceal his fraudulent conduct by making false representations and creating false documentation purporting to show that he had provided thousands of treatments he had billed for, but never rendered. For example, in response to a July 2018 subpoena from the HHS’s Office of Inspector General (OIG) seeking medical records for 10 of his patients, he created documents—and ordered his office workers to create documents—falsely stating that those patients had received dozens of treatments they had never been provided and falsely representing that the condition of those patients was improving.
The wire fraud charges provide for a sentence of up to 20 years in prison, three years of supervised release, and a fine of $250,000 or twice the gross gain or loss, whichever is greater. The charges of false statements relating to healthcare matters and obstruction of a criminal investigation of a healthcare offense each provide for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000 or twice the gross gain or loss, whichever is greater.
Compliance Perspective
Issue
Healthcare fraud affects everyone—individuals and businesses alike—and causes tens of billions of dollars in losses each year. It can raise health insurance premiums, expose individuals to unnecessary medical procedures, and increase taxes. Healthcare fraud can be committed by medical providers, company owners, patients, and others who intentionally deceive the healthcare system to receive unlawful benefits or payments. It is illegal to submit claims for payment to Medicare or Medicaid that you know or should know are false or fraudulent. Filing false claims may result in fines of up to three times the programs’ loss plus $11,000 per claim filed. Under the civil False Claims Act, each instance of an item or a service billed to Medicare or Medicaid counts as a claim, so fines can add up quickly. The OIG strongly encourages nursing facilities to have comprehensive procedures in place to ensure that services are of an appropriate quality and level and are in fact delivered to nursing facility residents as ordered and as reported in claims for reimbursement. Moreover, accurate documentation at the time of service is critical to ensuring that billing is fully supported. Facility staff should be knowledgeable in how to report suspicious billing practices. A nonretaliatory environment for reporting suspicious billing practices is mandatory for all facilities.
Discussion Points
- Review policies and procedures for preventing and reporting false claims and suspicious billing practices. Update your policies and procedures as needed.
- Train all staff on what can be considered a false claim. Include information on how to report concerns and suspected violations, and that prompt reporting is mandatory. Document that these trainings occurred, and file the signed documents in each employee’s education file.
- Periodically perform audits to ensure all staff are aware of their responsibility to identify compliance and ethics concerns and to promptly report violations to their supervisor, the compliance and ethics officer, or via the anonymous hotline. Perform Triple Checks for all Medicare Part A claims prior to submission to ensure that medical necessity is supported by appropriate documentation, and that services meet skilled care requirements.
*This news alert has been prepared by Med-Net Concepts, LLC for informational purposes only and is not intended to provide legal advice.*
