Connecticut Physicians to Pay $4.9 Million to Resolve False Claims Act Allegations

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Connecticut Physicians to Pay $4.9 Million to Resolve False Claims Act Allegations

Two Connecticut physicians, who are husband and wife, reached an agreement with the federal and Connecticut governments to pay $4,927,903 to resolve allegations that they violated the federal and state False Claims Acts.

The physicians owned and operated Middlesex Rheumatology, a medical practice that specialized in arthritis and autoimmune diseases. The husband was the treating physician, and the wife was a part-owner of the practice. The husband-physician prescribed his rheumatoid arthritis patients with Remicade, an injectable prescription medication. When prescribing that medication to Medicaid patients, he was required to submit a claim to Connecticut Medicaid, which would send payment to Caremark Massachusetts Specialty Pharmacy. Caremark then delivered the requested quantity of Remicade directly to Middlesex Rheumatology so that the practice incurred no out-of-pocket costs.

The government alleged that the defendants submitted false claims to Medicaid requesting the delivery of Remicade for certain Medicaid patients, knowing that those Medicaid patients were not actually being treated with the drug, and that, instead, the defendants administered the medication to patients covered by Medicare and the Connecticut State Employees Health Plan.  The government alleged that the defendants then submitted claims for reimbursement those health care programs, despite having obtained the medication for free from Medicaid fraudulently.

The $4.9 million settlement amount covers claims submitted to the Medicaid program from September 2013 through January 2018, and claims submitted to Medicare and the Connecticut State Employees Health Plan from July 2013 through June 2017. In October 2019, the husband-physician pleaded guilty to health care fraud and was sentenced to 37 months in prison.

Read the DOJ press release here.

Former Veterans Affairs’ Podiatry Chief Sentenced to 6.5 Years in Prison for Health Care Fraud Scheme

The former Chief of Podiatry for the Veterans Affairs’ Northern California Health Care System received a sentence of six and a half years in prison after a federal jury found him and a co-conspirator guilty of health care fraud and conspiracy to commit wire fraud. The evidence presented at trial demonstrated that the former Chief and his co-conspirator, the founder and former CEO of Sunrise Shoes and Pedorthic Service Corporation, billed the VA for prescribed work and services for shoes delivered to veterans that were not supplied, thereby defrauding the VA.

The government also established that the defendants and a former Sunrise Shoes employee made materially false statements to the VA regarding where shoes were manufactured, in connection with an application for an $11 million annual national contract. The Chief’s co-conspirator was sentenced to five years in prison and the former Sunrise Shoes employee, who had separately pleaded guilty, was sentenced to one year and one day in prison.

Read the DOJ press release here.

Hospice Center Agrees to Pay $1.75 Million to Resolve False Claims Act Allegations

STG Healthcare of Atlanta, Inc. and two senior executives agreed to pay $1.75 million to resolve allegations that the company submitted false claims to Medicare and Medicaid for patients who were not eligible for those services, and that the company provided unlawful kickbacks to a referring physician in violation of the Anti-Kickback Statute.

A hospice provider billing Medicare and Medicaid must ensure that its patients have a terminal illness and a life expectancy of six months or less, and are electing palliative care in order to provide relief from pain, symptoms, or stress. The settlement resolves allegations that, between 2013 and 2017, STG Healthcare set aggressive patient enrollment goals and failed to properly supervise employee’s admissions practices, which ultimately resulted in the company’s submission of claims to federal health care programs for patients who were not terminally ill. The government also alleged that STG Healthcare submitted or caused the submission of claims to the government for services provided by a physician who was paid to be a “back up” medical director but did not actually serve as a legitimate physician.

The lawsuit originated from a complaint filed by two former STG Healthcare employees under the qui tam provisions of the False Claims Act; those employees will receive a share of the settlement proceeds.

Read the DOJ press release here.

Florida Medical Biller Sentenced In Large Healthcare Fraud Scheme

Following a guilty plea, US District Judge Mary S. Scriven sentenced a medical biller to five years’ probation, with four months of home detention, for conspiracy to commit health care fraud.

The government alleged that the defendant owned and operated a medical billing company, Tri-County Billing, which submitted false and fraudulent claims to Medicare, Medicaid, TRICARE, and CHAMPVA for three clinics owned and operated by “Doctor 1.” Doctor 1 allegedly employed health care providers who were prohibited from billing the government for medical services and directed the defendant to bill for those services as if they had been rendered by Doctor 1.  Doctor 1 also allegedly hired nurse practitioners to perform medical services and directed the defendant to bill the government for those services as if they had been performed by a doctor. According to the government, both the defendant and Doctor 1 knew all of these claims were false and fraudulent.

In addition to her probation and home detention sentence, the defendant was also ordered to pay restitution to the defrauded health care programs, and the court entered a money judgment of more than $5,700.

Read the DOJ press release here.