Two Florida men pleaded guilty for their roles in a scheme to defraud Medicare by submitting over $67 million in false claims for genetic testing and durable medical equipment that patients did not need and that the defendants procured with kickbacks. The pleas came after four days of trial in the Southern District of Florida, and was announced on July 17, 2023, by the Department of Justice.
According to court documents, one of the men (Defendant 1) owned and managed call centers that he used to conduct deceptive telemarketing campaigns targeting Medicare beneficiaries to solicit them for unnecessary genetic testing and durable medical equipment. The other man (Defendant 2) worked for these call centers and acted as a straw owner for a laboratory that submitted false genetic testing claims. The men and their co-conspirators paid kickbacks and bribes to telemedicine companies in exchange for completed doctors’ orders, sold doctors’ orders to laboratories and durable medical equipment companies in exchange for kickbacks, forged doctors’ and patients’ signatures, and tricked medical providers into ordering medically unnecessary genetic testing. Between January 2020 and July 2021, the scheme resulted in the submission of over $67 million in false claims to Medicare for medically unnecessary genetic tests and durable medical equipment.
Defendant 1 pleaded guilty to conspiracy to commit healthcare fraud and wire fraud and conspiracy to defraud the United States and to pay and receive kickbacks. He faces a maximum penalty of 25 years in prison. Defendant 2 pleaded guilty to conspiracy to commit healthcare fraud and faces a maximum penalty of 10 years in prison. Both men are scheduled to be sentenced on Dec. 5. A federal district court judge will determine any sentence after considering the US Sentencing Guidelines and other statutory factors.
Five other defendants in this case have pleaded guilty and are awaiting sentencing. Three defendants are scheduled for a trial set to commence on Sept. 26. The FBI and HHS-OIG are investigating the case.
Compliance Perspective
Issue
The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded healthcare programs. The Anti-Kickback Statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients. All members of the healthcare team should be knowledgeable of what may be considered an illegal kickback. A kickback, or failure to report a kickback, can result in fines and other sanctions, including placement on the OIG’s List of Excluded Individuals and Entities. Staff should also understand their responsibility to identify and report concerns of utilization of any services that they believe are unnecessary or inappropriate for a resident, to include ordered tests, procedures, treatments, therapies, and medications.
Discussion Points
- Review your policies and procedures on ensuring that all provided resident services are reasonable and necessary and for prevention of false claims. Also review your policies and procedures for preventing and reporting kickbacks. Update your policies and procedures as needed.
- Train appropriate staff on how to determine if services each resident is receiving are reasonable and necessary. Train all staff on the Anti-Kickback Statute and what can be considered a kickback. Ensure appropriate staff monitor for potential false claims related to unnecessary or inappropriate services that are unsupported by documentation. Include information on how to report concerns and suspected violations, and that prompt reporting is mandatory. Document that the trainings occurred and place in each employee’s education file.
- Periodically audit medical records to ensure that all services provided to residents are reasonable and necessary. Also periodically audit to ensure that staff are aware of what should be done if they suspect unnecessary services are being ordered or provided and if an illegal kickback has occurred, whether intentionally or unintentionally.
*This news alert has been prepared by Med-Net Concepts, LLC for informational purposes only and is not intended to provide legal advice.*
