Two Charged in Healthcare Fraud Scheme Involving Drug and Alcohol Rehabilitation Center with Multiple Pennsylvania Locations
Federal charges against a physician in a drug and alcohol rehabilitation organization that had multiple treatment centers in Pennsylvania and an employee of a Florida-based laboratory were announced by the Pennsylvania Office of the Attorney General. The pair are each charged with one count of conspiracy to commit healthcare fraud, in violation of 18 U.S.C. §371.
The federal charging documents allege each man participated in an elaborate scheme involving thousands of medically-unnecessary urine tests ordered by the physician and processed by a lab in Florida associated with the other defendant. The charging documents allege that the physician defendant ordered tests to be performed on samples obtained from the treatment centers’ patients, even though the doctor never treated those individuals. The tests were then sent to Florida-based laboratories for a battery of unnecessary tests, and the lab-associated defendant allegedly paid kickbacks to principals at the drug and alcohol rehabilitation organization in return for directing the samples to his company.
If convicted, each defendant faces a maximum possible sentence of five years’ imprisonment and a fine of $250,000, along with restitution of millions to the victims of this fraud.
Compliance Perspective
Physicians accepting payments to direct samples obtained from patients who have not been seen by a physician to laboratories for unnecessary tests, and submitting claims to Medicare and Medicaid based upon those tests, may be in violation of the False Claims Act, the Stark Law, and the Anti-Kickback Statute, and committing healthcare fraud.
Discussion Points:
- Review policies and procedures regarding physician services and vendor agreements.
- Train nursing staff to monitor for unnecessary tests being ordered by physicians, and how to report any concerns.
- Periodically audit physician orders to ensure that ordered tests are supported by documentation of necessity based on the resident’s status. Periodically review vendor agreements to determine the level of compliance with all aspects of the contracts.
FRAUD MODULE 3 – MASTERING LEGAL IMPLICATIONS AND ANTI-TRUST LAWS
