California Man Pleads Guilty to Medicare Kickback Scheme
A California man recently pleaded guilty to conspiring with his spouse, the owners of home healthcare agencies, and a hospice agency to pay and receive illegal kickbacks in exchange for Medicare beneficiary referrals.
The accused man’s wife worked as the social services director at a skilled nursing and assisted living facility. She used her position to influence Medicare beneficiaries, who were being discharged, with their selection of home healthcare and hospice agencies. She would steer those Medicare beneficiaries to specific home healthcare and hospice agencies who, in exchange for the beneficiary referrals, would pay the couple illegal cash kickbacks.
In his plea agreement, the man admitted that the agencies’ owners paid him and his wife kickbacks in exchange for the referral of approximately 60 beneficiaries. Medicare paid the agencies approximately $400,000 for services they purportedly provided to the beneficiaries. Because the agencies obtained the beneficiary referrals by paying kickbacks, they should not have received any reimbursement from Medicare.
A U.S. District Judge is scheduled to sentence the man on April 30. He faces a maximum statutory penalty of five years in prison and a fine of $250,000 or twice the gross loss or gain. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which takes into consideration a number of variables.
Compliance Perspective
Allowing an employee to use his or her position to refer Medicare beneficiaries to agencies in order to receive kickbacks is in violation of the Anti-Kickback Statute, demonstrates a conflict of interest due to ownership of the homecare agencies, and could jeopardize the facility’s status, causing it to be excluded as a Medicare and Medicaid healthcare provider.
Discussion Points:
- Review policies and procedures addressing conflict of interest for personnel employed by the facility who could potentially use their position to unethically influence Medicare beneficiaries’ choices of healthcare providers after discharge for their personal gain.
- Train staff to be aware of and report to their supervisor or through the Hotline any suspected incident where a staff member might be using his or her position to influence Medicare beneficiaries’ choice of a post-discharge healthcare provider in order to receive kickbacks.
- Periodically audit the choices for post-discharge healthcare providers made by Medicare beneficiaries to determine if there is evidence of unethical influence by staff members that might indicate a violation of the Anti-Kickback Statute.
FRAUD MODULE 3 – MASTERING LEGAL IMPLICATIONS AND ANTITRUST LAWS
