Category Archives: HHS-OIG

Miami-Area Certified Nursing Assistant Sentenced to 150 Months in Prison for Role in $200 Million Medicare Fraud Scheme

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A Miami licensed nursing assistant was sentenced today to serve 150 months in prison for participating in a $200 million Medicare fraud scheme involving fraudulent billings by American Therapeutic Corporation (ATC), a mental health company headquartered in Miami.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the Health and Human Services Office of Inspector General’s (HHS-OIG) Florida region made the announcement.

Rodolfo Santaya, 55, of Miami, was convicted on July 18, 2014, after a six-day jury trial, of conspiracy to commit health care fraud and wire fraud, conspiracy to pay and receive bribes and kickbacks, and two counts of receipt of bribes and kickbacks in connection with a federal health care benefit program.  In addition to the prison sentence, U.S. District Judge Jose E. Martinez of the Southern District of Florida ordered Santaya to pay more than $18.2 million in restitution.

Evidence at trial demonstrated that, between 2006 and 2010, Santaya was paid thousands of dollars a month in cash kickbacks in exchange for referring Medicare beneficiaries to ATC, which operated purported partial hospitalization programs (PHPs) in seven locations throughout South Florida and Orlando.  A PHP is a form of intensive treatment for severe mental illness.

Evidence at trial also demonstrated that the Medicare beneficiaries Santaya sent to ATC did not need, qualify for, nor receive PHP treatment.  Nevertheless, ATC submitted false and fraudulent bills to Medicare for services purportedly provided to each of Santaya’s patients.  In order to justify ATC’s fraudulent billings, medical professionals, including doctors, fabricated and signed fraudulent medical documentation and patient files.

ATC, an associated management company, and more than 20 individuals, including ATC’s owners, have all previously pleaded guilty or been convicted at trial.  Santaya has been in federal custody since his conviction.

The case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  The case is being prosecuted by Assistant Chief Robert A. Zink and Trial Attorneys Nicholas E. Surmacz and Kelly Graves of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.

Owners of Orlando Health Care Clinic Charged with $3 Million Medicare Fraud Scheme

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Charges have been unsealed against husband and wife owners of an Orlando health care clinic for their roles in a fraud scheme that resulted in the submission of more than $3 million in allegedly fraudulent claims to Medicare.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III of the Middle District of Florida and Special Agent in Charge Derrick Jackson of the U.S. Health and Human Services Office of Inspector General’s (HHS-OIG) Florida region made the announcement after the defendants were taken into custody last night and this morning.

A federal grand jury in the Middle District of Florida returned an indictment on Nov. 19, 2014, against Juan Carlos Delgado, 58, and Nereyda Infante, 48, both of Orlando, Florida, charging them with one count of conspiracy to commit health care fraud, five counts of health care fraud, and one count of conspiracy to commit money laundering.  According to the indictment, Delgado and Infante owned and operated Prestige Medical Services and Rehab Center, a health care clinic that purportedly provided medical services to Medicare Part B and Medicare Part C beneficiaries, and three other similarly named clinics that also purportedly provided medical services to Medicare Part C beneficiaries.

Between February 2012 and September 2014, the defendants allegedly submitted claims to Medicare that falsely represented that medical services were provided, medically necessary, and prescribed by a physician, when they were not.  The health care fraud counts specifically allege fraudulent claims involving Pentostatin prescriptions, an expensive chemotherapeutic medication, that were not medically necessary, not prescribed by a physician, and not provided.  The indictment also alleges that the defendants transferred proceeds obtained as the result of fraudulent claims and diverted them for their personal use.  According to the indictment, the defendants obtained more than $1.8 million in proceeds from the alleged fraud.

The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

The case is being investigated by the HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Middle District of Florida.  The case is being prosecuted by Trial Attorney Andrew H. Warren of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.

Rite Aid Corporation Pays $2.99 Million for Alleged Use of Gift Cards to Induce Medicare and Medicaid Business

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Rite Aid Corporation, a Delaware corporation and national retail drugstore chain with its principal place of business in Camp Hill, Pennsylvania, has paid the United States $2.99 million to resolve allegations that it violated the False Claims Act by inappropriately using gift cards as inducements, the Department of Justice announced today.

The settlement resolves allegations that Rite Aid offered illegal inducements to Medicare and Medicaid beneficiaries to transfer their prescriptions to Rite Aid pharmacies.  The government alleged that from 2008 to 2010, Rite Aid had knowingly and improperly influenced the decisions of Medicare and Medicaid beneficiaries to transfer their prescriptions to Rite Aid pharmacies by offering them gift cards in exchange for their business.

“This case demonstrates the government’s ongoing commitment to enforcing accountability, transparency and fairness in the retail pharmacy industry,” said Acting Assistant Attorney General Joyce R. Branda for the Civil Division.  “The government will continue to advocate for the best interests of Medicare and Medicaid patients, and prevent pharmacies from improperly manipulating their healthcare choices.”

“This settlement holds Rite Aid accountable for exerting undue influence on individuals when they make important healthcare decisions about where and when to fill prescriptions,” said Acting U.S. Attorney Stephanie Yonekura for the Central District of California.  “Corporate profit should never steer an individual away from making the right healthcare decision.”

“Pharmacies are not allowed to improperly influence the decision-making of Medicare and Medicaid patients about where to fill prescriptions,” said Special Agent in Charge Glenn R. Ferry for the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG).  “Pharmacy chains that manipulate patient choices in this way will be held accountable.”

The settlement resolves allegations filed by Jack Chin under the qui tam, or whistleblower provisions of the False Claims Act, which authorizes private parties to sue for fraud on behalf of the United States and share in the recovery.  Chin will receive approximately $508,300 of the settlement.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $23.2 billion through False Claims Act cases, with more than $14.9 billion of that amount recovered in cases involving fraud against federal health care programs.

This case was investigated jointly by the Commercial Litigation Branch of the Civil Division, the U.S. Attorney’s Office for the Central District of California, the National Association of Medicaid Fraud Control Units and HHS-OIG.

The claims settled by today’s agreement are allegations only and there has been no determination of liability.

Principal in $28.3 Million Medicare Fraud Scheme Sentenced to 11 Years in Prison

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A Florida owner and operator of multiple physical therapy rehabilitation facilities was sentenced in federal court in Tampa today to serve 11 years in prison for his role in organizing a $28.3 million Medicare fraud scheme involving physical and occupational therapy services.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III of the Middle District of Florida, Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office and Special Agent in Charge Paul Wysopal of the FBI’s Tampa Field Office made the announcement.

Luis Duluc, 54, of Tampa, pleaded guilty on Feb. 3, 2014, to conspiracy to commit health care fraud as well as making a false statement relating to health care matters.  In addition to the prison term, U.S. District Judge Susan C. Bucklew of the Middle District of Florida ordered Duluc to pay $14,424,856 in restitution.

According to Duluc’s admissions in connection with his guilty plea, he and his co-conspirators used various physical therapy clinics and other businesses throughout Florida to submit approximately $28,347,065 in fraudulent reimbursement claims to Medicare between 2005 and 2009.  Medicare paid approximately $14,424,865 on those claims.

Duluc was chairman and president of a Delaware holding company known as Ulysses Acquisitions Inc., which was used to purchase comprehensive outpatient rehabilitation facilities and outpatient physical therapy providers, including West Coast Rehab Inc. in Fort Myers, Florida; Rehab Dynamics Inc. in Venice, Florida; Polk Rehabilitation Inc. in Lake Wales, Florida; and Renew Therapy Center of Port St. Lucie LLC in Port St. Lucie, Florida.  This gave Duluc and his co-conspirators control of those clinics’ Medicare provider numbers, which allowed them to bill Medicare for services.

Duluc admitted that he and his co-conspirators paid kickbacks to obtain, and stole, the personal identifying information of Medicare beneficiaries, and that he and his co-conspirators also obtained unique identifying information of physicians.  They then used this information to create and submit false claims to Medicare through the clinics owned by Ulysses Acquisitions.  These claims sought reimbursement for therapy services that were not legitimately prescribed and not actually provided.  Duluc admitted that he and his co-conspirators created and used false and forged patient records in an effort to conceal the fact that services had not actually been provided.

Duluc also admitted that he developed and marketed the “80/20 deal.”  In these deals, Duluc and his co-conspirators submitted false reimbursement claims to Medicare on behalf of Miami-based therapy clinics, such as Hallandale Rehabilitation Inc., Tropical Physical Therapy Corporation, American Wellness Centers Inc. and West Regional Center Inc.  Duluc and co-conspirators retained approximately 20 percent of the money Medicare paid on these claims and paid the other 80 percent to the co-conspirator clinic owners.

When Duluc and his co-conspirators were done using the clinics they acquired through Ulysses Acquisitions, they engaged in sham sales to nominee or straw owners, all of whom were recent immigrants to the United States with no background or experience in the health care industry.  Duluc admitted that he did this in an effort to disassociate from the fraudulent operations of the rehabilitation facilities.

This case is being investigated by HHS-OIG and the FBI and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and U.S. Attorney’s Office for the Middle District of Florida.  This case is being prosecuted by Senior Trial Attorney Christopher J. Hunter and Trial Attorney Andrew H. Warren of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Simon A. Gaugush of the Middle District of Florida.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.

Miami-Area Hospital Chief Operating Officer Pleads Guilty in $67 Million Mental Health Care Fraud Scheme

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The former chief operating officer of a Miami-area hospital pleaded guilty today for his role in a mental health care fraud scheme that resulted in the submission of more than $67 million in fraudulent claims to Medicare by a state-licensed psychiatric hospital located in Hollywood, Florida, that purported to offer both inpatient and outpatient mental health services.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the U.S. Health and Human Services Office of Inspector General’s (HHS-OIG) Florida region made the announcement.

Christopher Gabel, 61, of Davie, Florida, the former Chief Operating Officer (COO) of Hollywood Pavilion LLC (HP), pleaded guilty before U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and pay and receive health care kickbacks.  Gabel was charged in an indictment returned on May 8, 2014.

According to Gabel’s admissions in connection with his guilty plea, between April 2003 and September 2012, HP submitted false and fraudulent claims to Medicare for treatment that was not medically necessary or not provided to patients.  As COO during that time, Gabel supervised HP’s staff at both its inpatient and outpatient facilities, where Medicare beneficiaries were admitted to HP regardless of whether they qualified for mental health treatment, and were often admitted before seeing a doctor.

Gabel admitted that HP obtained Medicare beneficiaries from across the country by paying bribes and kickbacks to various patient brokers.  Gabel instructed the patient brokers to falsify invoices and marketing reports in an effort to hide, and cover up the true nature of the bribes and kickbacks they were receiving from HP.  From 2003 through August 2012, HP billed Medicare approximately $67 million for services that were not properly rendered, for patients that did not qualify for the services being billed, and for claims for patients who were procured through bribes and kickbacks.  Medicare reimbursed HP nearly $40 million for those claims.

Karen Kallen-Zury, Daisy Miller, Michele Petrie and Christian Coloma were convicted at trial in June 2013 for their roles in this scheme.  Kallen-Zury, HP’s former chief executive officer, was sentenced to 25 years in prison.  Miller, the clinical director of HP’s inpatient facility, was sentenced to 15 years in prison; and Petrie, the head of HP’s intensive outpatient program, was sentenced to six years in prison.  Coloma, the director of physical therapy for an entity associated with HP, was sentenced to 12 years in prison.  Kallen-Zury, Miller and Petrie were ordered to pay nearly $40 million in restitution, and Coloma was ordered to pay more than $20 million in restitution.

The case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  The case is being prosecuted by Trial Attorneys Nicholas E. Surmacz, Andrew H. Warren and L. Rush Atkinson of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

Michigan Physician Pleads Guilty for Role in $19 Million Medicare Fraud Scheme

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A Detroit-area physician, who orchestrated the submission of fraudulent claims for physician home visits and directed fraudulent referrals for home health care by his employee physicians as part of a $19 million home health care fraud scheme, pleaded guilty today for his role in the conspiracy.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office made the announcement.

Dr. Rajesh Doshi, 59, of Bloomfield Hills, Michigan, pleaded guilty before Senior U.S. District Judge Arthur J. Tarnow of the Eastern District of Michigan to conspiracy to commit health care fraud and one count of health care fraud.  The sentencing hearing is set for March 3, 2015.

According to his plea agreement, Dr. Doshi admitted that between October 2005 and September 2012, he conspired with others to commit health care fraud by referring Medicare beneficiaries for home health care that was not medically necessary, and then submitting false and fraudulent claims for the purported care to Medicare for reimbursement.  Dr. Doshi admitted that he submitted these false claims through Home Physicians Services (HPS), a medical practice he owned in Southfield, Michigan.  Although Dr. Doshi owned HPS, he hid his ownership because of prior state court convictions.

Specifically, Dr. Doshi admitted that he paid kickbacks to recruiters to obtain Medicare beneficiaries for HPS and home health agencies owned by co-conspirators.  Dr. Doshi and his co-conspirators then falsified medical and billing records for purported physician home visits, sometimes adding diagnoses to make it appear that the beneficiaries qualified for and required home care when they did not, and other times, “upcoding” physician home visits to higher levels of complexity than actually performed.

Dr. Doshi also admitted that he solicited and received kickbacks from home health agency owners in exchange for the referral of beneficiaries to those agencies, regardless of whether the beneficiaries qualified for or needed home health care.  He then directed HPS physicians to falsify medical documentation and certify Medicare beneficiaries as homebound even though the HPS physicians had never met the beneficiaries or the beneficiaries were not actually homebound.

Between October 2005 and September 2012, Dr. Doshi and his co-conspirators caused Medicare to pay more than $19 million based on false claims.  Three other physicians and one physician assistant have already pleaded guilty for their involvement in the health care fraud conspiracy related to the scheme at HPS.

This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.  This case is being prosecuted by Trial Attorney Niall M. O’Donnell of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

Five Florida Residents Plead Guilty for Roles in $6 Million Miami Home Health Care Fraud Scheme

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Five South Florida residents pleaded guilty this week in connection with a long-running $6.2 million Medicare fraud scheme involving Professional Medical Home Health LLC (Professional Home Health), a Miami home health care agency that purported to provide home health and therapy services.  Two of the defendants also pleaded guilty in connection with their conduct in similar schemes at other Miami home health care agencies.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.

Dennis Hernandez, 32, of Miami, pleaded guilty to one count of conspiracy to commit health care fraud, and Juan Valdes, 37, of Palm Springs, Florida, pleaded guilty to one count of conspiracy to defraud the United States and receive health care kickbacks before U.S. Magistrate Judge Chris M. McAliley of the Southern District of Florida on Nov. 10. 2014.  Jose Alvarez, 48, and Joel San Pedro, 44, both of Miami, and Alina Hernandez, 38, of West Palm Beach, Florida, each pleaded guilty to one count of conspiracy to commit health care fraud on Nov. 13, 2014 before Judge McAliley.  Sentencing hearings are set for Jan. 29, 2015.

According to admissions in their plea agreements, Dennis Hernandez, San Pedro and Alvarez held positions of influence at Professional Home Health, including those of owner/operator and manager/supervisor.  Through Professional Home Health, they billed the Medicare program for expensive physical therapy and home health services that were not medically necessary or were not provided.  The three defendants admitted that they and their co-conspirators coordinated the submission of fraudulent claims at Professional Home Health, and falsified patient documentation to make it appear that Medicare beneficiaries qualified for and received home health services that were, in fact, not medically necessary or not provided.

Additionally, each of the five defendants admitted to being patient recruiters for Professional Home Health.  In this role, they solicited and received kickbacks and bribes from other co-conspirators at Professional Home Health in exchange for recruiting beneficiaries who neither needed, nor, in some cases, received services.

Dennis Hernandez and Alvarez also admitted to participating in similar criminal conduct at additional Miami-area home health agencies.

From December 2008 through February 2014, Medicare paid Professional Home Health more than $6.2 million for these fraudulent home health claims.

Earlier this year, two other individuals pleaded guilty and were sentenced in connection with the same scheme.  Annarella Garcia, an owner of Professional Home Health, was sentenced to serve 70 months in prison.  Annilet Dominguez, an administrator of Professional Home Health, was sentenced to serve 68 months in prison.  Both were also ordered to pay $6,257,142 million in restitution.

This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  This case is being prosecuted by Trial Attorney Anne P. McNamara of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

Owner of Miami Home Health Company Pleads Guilty for Role in $30 Million Health Care Fraud Scheme

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An owner of a Miami home health care company pleaded guilty today for his role in a $30 million home health Medicare fraud scheme.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, and Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement

Ramon Regueira, 66, of Miami, pleaded guilty before U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida to one count of conspiracy to commit health care fraud.  Sentencing is scheduled for Jan. 21, 2015.

According to his plea agreement, Regueira was an owner of Nation’s Best Care Home Health Corp. (Nation’s Best), a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries.  Regueira admitted that he and his co-conspirators operated Nation’s Best for the purpose of billing the Medicare program for, among other things, expensive physical therapy and home health care services that were not medically necessary or were not provided.

Specifically, Regueira admitted that he and his co-conspirators paid kickbacks and bribes to patient recruiters who provided patients to Nation’s Best, as well as prescriptions, plans of care (POCs) and certifications for medically unnecessary therapy and home health services.    Regueira and his co-conspirators then used these prescriptions, POCs and medical certifications to fraudulently bill the Medicare program for unnecessary home health care services.

From January 2007 through November 2012, Nation’s Best submitted approximately $35 million in claims for home health services that were not medically necessary or not provided, and Medicare paid approximately $21 million for these fraudulent claims.

The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.  To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

Careall Companies Agree to Pay $25 Million to Settle False Claims Act Allegations

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CareAll Management LLC and its affiliated entities (collectively “CareAll”) have agreed to pay $25 million, plus interest, to the United States and the state of Tennessee to resolve allegations that CareAll violated the False Claims Act by submitting false and upcoded home healthcare billings to the Medicare and Medicaid programs, the Department of Justice announced today.  CareAll is based in Nashville, Tennessee, and is one of Tennessee’s largest home health providers.

“Home health agencies may only bill Medicare and Medicaid for care that is necessary and covered by the programs,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division.  “This settlement is another example of the department’s commitment to ensuring that home health care dollars – which are so vital to ensure the care of homebound patients – are spent for their intended purposes.”

This settlement resolves allegations that between 2006 and 2013, CareAll overstated the severity of patients’ conditions to increase billings and billed for services that were not medically necessary and rendered to patients who were not homebound.

“This case demonstrates that enforcement of the False Claims Act is a priority of the U.S. Attorney’s Office for the Middle District of Tennessee,” said U.S. Attorney David Rivera for the Middle District of Tennessee.  “The U.S. Attorney’s Office and our law enforcement partners are committed to protecting the public and vigorously pursuing all those who knowingly submit false claims affecting the Medicare and Medicaid programs.”

This is CareAll’s second settlement of alleged False Claims Act violations within the last two years.  In 2012, CareAll paid nearly $9.38 million for allegedly submitting false cost reports to Medicare.  As part of the settlement announced today, the companies agreed to be bound by the terms of an enhanced and extended corporate integrity agreement with the Department of Health and Human Services-Office of Inspector General (HHS-OIG) in an effort to avoid future fraud and compliance failures.

“Fraudulent home-based services are surging across the country,” said Special Agent in Charge Derrick L. Jackson of HHS-OIG in Atlanta.  “We will continue to protect both Medicare and taxpayers, and ensure that funds are not siphoned off by companies more concerned with the bottom line than patient care.”

Under the False Claims Act, private citizens, known as relators, can bring suit on behalf of the United States and share in any recovery.  The relator in this case, Toney Gonzales, will receive more than $3.9 million as his share of the recovery.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of HHS.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $23.1 billion through False Claims Act cases, with more than $14.8 billion of that amount recovered in cases involving fraud against federal health care programs.

The settlement was the result of a coordinated effort by the Civil Division, the U.S. Attorney’s Office for the Middle District of Tennessee, HHS-OIG and the Tennessee Bureau of Investigation.

The case is docketed as United States ex rel. Gonzales v. J.W. Carell Enterprises, Inc., et al., No. 12-0389 (M.D. Tenn.).  The claims resolved by the settlement are allegations only; there has been no determination of liability.

Biotronik Inc. to Pay $4.9 Million to Resolve Claims that Company Paid Kickbacks to Physicians

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Biotronik Inc. of Lake Oswego, Oregon, has agreed to pay the United States $4.9 million to resolve allegations made under the False Claims Act that the company made various improper payments to induce physicians to use devices that it manufactured and sold, the Justice Department announced today.

“When medical device manufacturers make improper payments to physicians, they encourage medical decision-making based on financial gain rather than the best interests of patients,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division.  “Today’s resolution demonstrates the Department of Justice’s continuing commitment to ensuring that beneficiaries of federal health care programs receive appropriate medical care.”

The settlement resolves allegations that Biotronik, through the payment of kickbacks to physicians, caused hospitals and ambulatory surgery centers to submit false claims to Medicare and Medicaid for the implantation of Biotronik pacemakers, defibrillators and cardiac resynchronization therapy devices.  Biotronik allegedly induced electrophysiologists and cardiologists practicing in Nevada and Arizona to continue using Biotronik devices, or to convert to Biotronik devices, by paying the implanting physician in the form of repeated meals at expensive restaurants and inflated payments for membership on a physician advisory board.

“Today’s resolution of claims underscores one of the key purposes of the Anti-Kickback law – to ensure that the judgment exercised by health care providers in treating Medicare and Medicaid patients is not influenced by illegal payments,” said U.S. Attorney Benjamin Wagner for the Eastern District of California.

The settlement announced today stems from a whistleblower complaint filed by a former Biotronik employee, Brian Sant, pursuant to the qui tam provisions of the False Claims Act, which permit private persons to bring a lawsuit on behalf of the United States and to share in the proceeds of the suit.  The act permits the United States to intervene and take over the lawsuit, as it did in this case as to some of Sant’s allegations.  Sant will receive approximately $840,000 of the federal settlement.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $23 billion through False Claims Act cases, with more than $14.8 billion of that amount recovered in cases involving fraud against federal health care programs.

The settlement with Biotronik Inc. was the result of a coordinated effort among the Civil Division, the U.S. Attorney’s Office for the Eastern District of California, the U.S. Department of Health and Human Services-Office of Inspector General and the FBI.

The lawsuit is captioned United States ex rel. Sant v. Biotronik, Inc., No. 2:09-CV-03617 KJM EFB (E.D. Cal.).  The claims settled by this agreement are allegations only, and there has been no determination of liability.