Category Archives: Medicare Fraud

Nursing Home Overpayments From Medicare Reaching New Heights

Jack Furumura was dehydrated and disoriented when he left his nursing home for a hospital in 2013. The 96-year-old lost five pounds during his nursing home stay, in large part because the nursing home failed to follow his nutrition plans, or the home’s very own policies for that matter.

2Mr. Furumura wasn’t able to recover from his ailments and weeks after being checked into a hospital he died at his daughter’s home. In the wake of her father’s death, Katherine Kiang was shocked to discover that Furumura was receiving over two hours of physical and occupational therapy from the nursing home before he was hospitalized.

Kiang said she couldn’t imagine why a 96-year-old dementia patient would receive that much therapy. Why would this nursing home put this man through that much therapy at that stage in his life, and in his condition?

Medicare Incentivizes ‘Ultra High’ Billing Levels

Unfortunately, there are many stories similar to Mr. Furumura’s. Worse yet, Medicare’s own rules are responsible for incentivizing nursing home facilities to bill at “ultra high” levels for services, even when it is wasteful, unnecessary, and, in some cases, harmful for patients. At first glance, the case laid out above seems like Medicare fraud, but unfortunately it appears to be business as usual for a system rife with problems.

At present, Medicare will pay for up to 100 days of a patient’s nursing home care in the aftermath of a hospital stay (in some cases, the patient pays for a portion of the care). Medicare pays nursing home facilities a daily rate for each patient, which is largely based on the duration of a patient’s therapy for a given week. For example, Medicare spent $13,468.19 on Mr. Furumura’s therapy and care. Even as he was deteriorating physically and mentally, the nursing home billed Medicare for his care at the highest possible rate.

Patients that are receiving therapy at the highest billing level generate the biggest payments that nursing homes receive from Medicare. What exactly is Medicare paying for? At least 720 minutes a week of physical therapy (helps with tasks like walking, avoiding falls), occupational therapy (helps with dressing and bathing) and speech therapy (helps patients who have had a stroke, for example, overcome language difficulties).

The ultra high rate, according to a Wall Street Journal news article, averaged out to around $560 per patient, per day in 2013. A “very high” day (between 500 and 719 minutes of therapy) averaged out to roughly $445 per patient. The “low” category (between 45 and 149 minutes of therapy) costs on average $325 per patient, per day.

The current Medicare payment rules were devised in 1998 and then fully-implemented in 2002. Since the day these new rules took effect, nursing homes have continued to bill at increasingly higher therapy levels. Reports indicate that nursing homes billed at the highest rates for patients on roughly 7 percent of days in 2002. Fast forward 11 years to 2013 and the rate for ultra high billing days increased to 53 percent, nearly eight times higher than 2002 standards.

To put this into a dollars and cents, according to data compiled by the Journal, Medicare paid out roughly $28 billion to nursing homes in 2013. That total is 10% more than Medicare would have paid if the proportion of days billed at each therapy level was at 2008 billing standards and 24% more than 2002 levels.

Does More Therapy Translate to Healthier Patients? 

The short answer to this question is there simply isn’t data out there to know for certain. According to Dr. Vincent Mor, there is “clear evidence” that therapy works, but one patient receiving more services than another doesn’t guarantee that the outcomes for one will be any different than the other. “We just don’t know,” says Dr. Mor, who is a health-services professor at Brown University as well chairman of the independent quality committee at HCR ManorCare Inc., which is one of the nation’s largest nursing home operators.

But despite having no evidence to suggest that more care translates to healthier patients, providers have continued to overwhelmingly bill at the highest possible levels. More than 20 current and former rehabilitation therapists interviewed for the Wall Street Journal news piece said they felt pressure from their bosses at nursing home facilities to reach the 720-minute therapy mark for the week in order to bill at the highest level.

According to these therapists, this care was delivered even when patients were unresponsive, weren’t likely to gain anything from the services, or outright declined the services. In some cases, patients became more agitated as a result of having gone through the therapy.

Harvard professor David Grabowski studies nursing home spending. He believes that there are patients that simply aren’t being treated appropriately because the system “rewards high-intensity care.”

Nursing Homes: The Business of Caring, but Still a Business 

Billing at the highest levels is not something restricted to larger nursing facilities—from the looks of the data, nursing homes of all sizes are billing Medicare at ultra high rates.

Genesis HealthCare Corp. is one of the largest nursing home providers in the country. In 2002, it billed Medicare at the ultra high rate in 8.1 percent of days. That number skyrocketed to 58 percent of days in 2013. Kindred Healthcare Inc., which operates nursing home facilities that contract with rehabilitation clinics, billed Medicare at the ultra high rate 7.6 percent of days in 2002. This increased to 58 percent in 2013. HCR ManorCare Inc. billed at the highest rate 8.8 percent of the time in 2002. By 2013, it was billing at the highest rate 68 percent of the time…you get the idea.

HCR is the subject of a whistleblower lawsuit which claims the company committed fraud by putting pressure on employees to perform unnecessary therapy so it could bill Medicare at the highest level. HCR wouldn’t comment on the whistleblower lawsuit, but the company refuted the basic claims on its website.

Nursing Home Medicare Fraud Whistleblower 

Allegations of nursing home facilities committing Medicare fraud is nothing new. This sector of health care has been rife with fraud and abuse for decades. But as we’ve seen in the many aforementioned examples, we have reached a tipping point where it has become business as usual for corrupt nursing homes to bill Medicare for care that is medically unnecessary, unwanted, and in some cases, harmful.

We need to tip the scales back in our favor and make it more difficult for nursing home facilities to commit fraud. A whistleblower case like the HCR lawsuit discussed above is one of the best weapons available to combat Medicare fraud committed by nursing home facilities. A successful whistleblower lawsuit not only returns taxpayer dollars to Medicare, it protects the program’s integrity and ensures that our elderly citizens are receiving appropriate care.

If you work at a nursing home facility and are being asked to perform medically unnecessary services, it is in your best interest to discuss the matter with an experienced whistleblower attorney. If your whistleblower lawsuit proves successful, it could help reduce waste and fraud and earn you a sizable whistleblower reward.

Contact a whistleblower attorney today for a free consultation.

CenseoHealth Employee Alleges Medicare Advantage Fraud

A whistleblower in Texas has filed a false claims lawsuit accusing a medical consulting business and over two dozen health plans for seniors of bilking money from government health care agencies. Whistleblower Becky Ramsey-Ledesma, a medical billing coder, claims that CenseoHealth LLC. performed in-home patient exams that allegedly overstated how much health plans should be paid.

Medicare Advantage FraudCenseoHealth is a Dallas, Texas-based firm that contracts with thousands of doctors that make in-home visits for seniors and evaluate their health for Medicare Advantage plans. CenseoHealth was founded in 2009. In only four years of business, its workforce grew from four in 2009 to over 300 in 2013, with projected revenue for that year estimated to reach $120 million. Doctors under contract with the company have reportedly made over a million in-home patient visits.

Ramsey-Ledesma once worked for CenseoHealth. She claims that she was fired in 2013 for objecting to the alleged fraudulent practices. Her lawsuit represents the latest in a string of whistleblower claims filed within the last few years alleging billing fraud in connection with Medicare Advantage.

What is Medicare Advantage and How Does it Work?

Medicare Advantage has become increasingly popular among the elderly. The latest statistics indicate that it now covers over 17 million Americans. Since the 1980’s, those eligible for Medicare have been able to choose between a regular fee-for-service plan (what we think of as ‘traditional Medicare’), in which the government pays an agreed-to fee to health care providers for each service provided, and a Medicare Advantage plan, where the government pays private insurers a flat fee per month for any individual enrolled.

The flat fee is based on what is called a risk score.

Here’s how risk scores are tabulated:

  • A doctor reviews a patient’s chart.
  • The doctor records any complaints and documents diseases.
  • That information is handed over to a private insurer, which then submits the diagnoses to Medicare.
  • Medicare boils down the diagnoses and predicts how much the cost of care will be for the patient.
  • After a complex process, Medicare pays the private insurer a set monthly fee per patient. If patients are sicker, the insurance company makes more because they require more care. If patients are healthier, the company makes less because they require less care.
  • The insurers can further analyze diagnoses and sponsor further checkups to see if the first doctor missed anything, then increase the patient’s risk score if necessary.

CenseoHealth Whistleblower Lawsuit

Ramsey-Ledesma claims that CenseoHealth used a complex algorithm in an attempt to find patients with undetected medical issues that could be used to boost their risk score and collect more money. CenseoHealth allegedly employed marketers to reach out to patients and schedule in-home patient visits. During these visits, doctors allegedly collected patient data, which could then be used to increase a risk score.

According to the CenseoHealth whistleblower lawsuit, the doctors never actually provided any medical treatment during these visits. Instead, physicians would test vitals, reflexes and listen to patients’ hearts and lungs. No physical was ever provided, nor was any blood work done.

The CenseoHealth whistleblower suit further claims that doctors often didn’t have medical licenses. Others were allegedly scheduled with as many as 10 home visits in a day and were paid a flat fee of $100 per visit. Some doctors simply made up test results, according to whistleblower allegations.

In one example cited in a story by NPR, patients were asked to draw the hands on a clock to show what time of day it was. The whistleblower allegations state that in some cases it was “obvious” that the same person was drawing the hands on the clocks for multiple forms.

The diagnoses, according to whistleblower claims, weren’t obtained from a medical examination, rather, they were self-reported from the patients themselves. Some simply couldn’t have been made in an in-home examination. Others were made based on what medications a patient was taken, though this didn’t take into account that medications can be prescribed for a wide variety of different treatments.

The false claims, according to the whistleblower lawsuit, inflated the cost Medicare paid for patient care. In total, 30 Medicare Advantage plans across 15 states are named, including Blue Cross, Humana, and a number of other significant industry names.

Ramsey-Ledesma’s whistleblower lawsuit is one of many targeting Medicare Advantage home home visits. Another was filed last year by a former compliance officer for Santa Ana, California-based Mobile Medical Examination Services Inc. Other Medicare Advantage whistleblower  lawsuits within the last five years have been filed in Florida and South Carolina.

In addition to the false billing accusations, all of the aforementioned whistleblower lawsuits claim that poor government oversight of Medicare Advantage has contributed to millions lost due to fraudulent charges.

What Are the Downsides?

The government trusts firms like CenseoHealth to report their own risk scores based on the honor system. When you factor in the last step listed above—the home patient visits—these checkups can (and according to the latest whistleblower allegations, do) result in providers jacking up the risk scores for patients, simply because there is no oversight.

According to the Center for Public Integrity, Medicare made nearly $70 billion in “improper” payments to Medicare Advantage plans between 2008 and 2013. According to government estimates, these payments were for the most part the result of overbilling based on inflated risk scores.

The Centers for Medicare and Medicaid Services (CMS) has said in-home health exams can have “significant value,” an opinion shared by America’s Health Insurance Plans, the health insurance industry trade group, which has said home visits are “an important component of disease management activities.”

At this moment, Medicare Advantage is in the midst of strong growth and continues to receive widespread political support from Congress. The House of Representatives recently passed a bill that appears to prevent federal officials from putting an end to in-home health assessments.

At the same time, CMS is drawing scrutiny because its head Andy Slavitt has ties to UnitedHealth Group, which runs the nation’s biggest Medicare Advantage plan. Senator Orrin Hatch (R-UT) was critical of Slavitt’s “conflicted history” after he was nominated for the top CMS job in July.

In other words, the fox is guarding the henhouse.

Make no mistake, these private health firms are in the business of making money. Take CenseoHealth as an example: one of the company’s largest investors is private equity firm Health Evolution Partners, which is headed by David Brailer, a former “health information czar” under President George W. Bush. Brailer was named chairman of CenseoHealth’s board of directors in March.

If companies like CenseoHealth don’t make profit for investors like Health Evolution Partners, investment firms simply take their business elsewhere, and you can bet that until there is reform in the system, there will always be companies that are willing to bend the rules to make more money.

Become a Medicare Advantage Whistleblower

Now more than ever, we need whistleblowers with knowledge of Medicare Advantage fraud to come forward. The CMS study, along with everything mentioned above, is a clear indication that fraud in the system isn’t going to go away on its own. The companies responsible for stealing money from the government need to be held accountable. That justice can start with you.

Community Health Network Agrees to Settle Medicare Fraud Lawsuit for $20.3 Million

Federal prosecutors announced yesterday that Community Health Network has agreed to pay $20.3 million to settle allegations that the health care provider had for years submitted false claims for Medicare and Medicaid reimbursement. Community Health operates seven hospitals in Indianapolis and has dozens of other medical facilities scattered throughout Central Indiana.

chn_vert_colorAccording to Assistant U.S. Attorney Shelese Woods, the settlement is related to contracts that Community Health had previously entered into with local ambulatory surgery centers not owned by the provider. The cost of performing surgeries at these centers was allegedly cheaper than the cost of performing the same surgeries at a Community Health hospital. The difference in price for the procedures could range from small (around $200) to quite substantial ($2,000).

The government contends that Community Health doctors would refer patients to surgery centers in an effort to cut costs. At the same time, Community Health allegedly submitted bills to Medicare and Medicaid claiming the surgeries had been performed at a Community Health hospital when, in fact, they were performed at the cheaper surgery centers. These alleged false claims resulted in the government overpaying for the surgeries.

Woods told the media that she believes Community Health had actually been engaging in the fraud laid out in the allegations since the late 1990’s, but the statute of limitations on health care fraud prevented the allegations from going back that far. Community Health purportedly stopped submitting bills in this manner in 2009. According to the Indianapolis Star, the provider no longer  has contracts with surgery centers.

The government notified hospitals back in November of 2007 that submitting reimbursement bills to Medicare for outside procedures and falsely claiming they were done in-house was not allowed. According to Woods, the damages from Community Health’s alleged scheme after this notice had been sent out totaled $9.35 million.

New Attorney General Focuses her Attention on Medicare/Medicaid Fraud

The Department of Justice, in a nationwide sweep of Medicaid/Medicare cheaters, charged 243 people today with crimes related to their alleged involvement in health care fraud schemes that generated over $712 million in false billings. Attorney General Loretta E. Lynch and Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell announced the nationwide sweep, led by the Medicare Fraud Strike Force, which was the largest takedown in the history of the Strike Force, both in terms of defendants charged and amount in fraudulent billings.

dept_justiceRevealing a possible change in policy, those indicted included forty-six physicians and other healthcare providers. In addition to the criminal charges, the Centers for Medicare & Medicaid Services (CMS) also suspended a number of providers from participating in government health care programs, cutting off their source of funding.

According to the Justice Department, the sweep caught doctors, patient recruiters, home health care providers, pharmacy owners, and a host of others. The defendants have been accused of various crimes, including money laundering, violations of anti-kickback statutes, aggravated identity theft and conspiracy to commit health care fraud.

The scams allegedly involved fraudulent billing for treatments ranging from psychotherapy to home health care. Those who participated in the scams allegedly submitted claims to Medicare and Medicaid for equipment that wasn’t provided, treatments that weren’t medically necessary and services that were never rendered.

During her speech today, Lynch described one example of a medical professional charged in the sweep:

A Michigan doctor allegedly prescribed narcotic pain medications to patients who didn’t need them. When the physician obtained the patients’ personal data, they billed additional charges as if the patient was obtaining the needed medications and services. If a patient tried to withdraw from the scheme, the doctor allegedly threatened to stop giving them the pain medications to which they had become addicted.

In Miami, Florida, 73 defendants were charged for their alleged involvement in schemes that accounted for over $263 million in false billings. In one example, the administrators of a Miami mental health center submitted nearly $64 million in billings between 2006 and 2012 for purported intensive mental health treatment to Medicare beneficiaries. The administrators allegedly paid kickbacks to patient recruiters and assisted living facility owners throughout the South Florida area.

The whistleblower law firm of Baum, Hedlund, Aristei & Goldman applauds the government’s effort in bringing these alleged criminals to justice. Many people depend on our nation’s health care system, especially those living through their most vulnerable moments. Health care fraud takes valuable resources from the sick and the suffering, and our firm is determined to help whistleblowers expose schemes that steal from State and Federal health care programs.


Hebrew Homes Whistleblower Receives $4.25 Million Reward in Landmark Case

A skilled nursing facility and its former president has agreed to settle a whistleblower lawsuit filed by a former executive who claimed that  the facility was engaged in paying illegal kickbacks to several physicians.  The Florida healthcare provider, Hebrew Homes Health Network Inc. and its affiliates, including all of  its operating subsidiaries and its former president and executive director, have agreed to pay $17 million to the United States government to resolve allegations that it violated the Anti-Kickback Statute.  The Relator claimed that the nursing facility paid doctors in exchange for Medicare patient referrals. Stephen Beaujon, the former CFO of Hebrew Homes, who filed the whistleblower lawsuit, will receive $4.25 million for bringing the alleged fraud to the government’s attention.

dept_justiceAccording to the Justice Department, Hebrew Homes allegedly operated a sophisticated kickback scheme between 2006 and 2013 in which they hired a number of doctors that were given the title of ‘medical director.’ These medical directors were under contracts that specified numerous job duties and hourly requirements, for which they were paid thousands of dollars per month.

The government alleged that these medical director positions only existed on paper, and that most of the medical directors were not actually required to perform their contracted job duties.  Rather, each was allegedly paid for patient referrals to Hebrew Homes facilities. Once the facility put the medical directors on the payroll, the government claims that Medicare patient referrals increased exponentially.

In addition to the $17 million, the settlement requires former Hebrew Homes president William Zubkoff to resign as its Executive Director and leave the company. It further requires Hebrew Homes to enter into a five-year corporate integrity agreement with the Department of Health and Human Services, Office of Inspector General (HHS-OIG). The Agreement also requires the company to change its policies concerning the hiring and maintaining of medical directors.

This represents the largest settlement in U.S. history involving alleged violations of the Anti-Kickback Statute by a skilled nursing facility. The Anti-Kickback Statute is intended to ensure that a doctor’s medical judgment is based solely on the wellbeing of a patient, not financial rewards.

The Hebrew Homes case highlights the government’s interest in encouraging whistleblowers to report fraud in skilled nursing home facilities.  This fraud preys on the elderly and infirm and is egregious.  Whistleblowers are incentivized to come forward if they have firsthand knowledge of fraud. The wellbeing of our country’s elderly population is compromised when health care providers put profit over patient health. Whistleblowers, who come forward and expose kickbacks and fraud, protect both the integrity of government health care programs and the health of our seniors.

If you have knowledge of health care fraud, it is in your best interest to consult with an experienced whistleblower attorney as soon as possible. The whistleblower law firm of Baum, Hedlund, Aristei & Goldman can help you decide the best way to move forward with a claim. Contact a whistleblower attorney today for a free case evaluation.

Detroit Doctor Pleads Guilty in Two Criminal Cases, Admits to Defrauding Medicare and Causing Bodily Harm to Patients

A Detroit-area neurosurgeon has pleaded guilty to two criminal cases claiming he collected over $11 million in fraudulent Medicare claims and caused serious bodily harm to patients who were forced to endure medically unnecessary surgeries. Dr. Aria O. Sabit, 39, pleaded guilty last Friday to four counts of health care fraud, one count of conspiracy to commit health care fraud and one count of unlawful distribution of a controlled substance at a hearing before U.S. District Judge Paul D. Borman of the Eastern District of Michigan. Sabit, a Birmingham, Michigan resident, will be sentenced on September 15.

hospital-room-449234-mAccording to the Justice Department, Sabit owned and operated the Michigan Brain and Spine Physicians Group, with locations scattered throughout the greater Detroit area. He admitted to fraudulently obtaining significant profits by convincing his patients to undergo spinal fusion surgeries using medical devices designed to stabilize and strengthen the spine. Many of these surgeries didn’t include the use of medical devices, but that didn’t stop Sabit from billing Medicare and Medicaid for the fraudulent surgeries.

Sabit admitted that his operative reports contained false statements concerning the procedures he was performing, as well as the instrumentation he used. He further admitted to billing for implants that were never actually provided.

Before Sabit moved to begin practicing in Michigan, he was involved in a physician-owned distributorship (POD) called Apex Medical Technologies while on staff at a California hospital. During this time, Apex paid out kickbacks to physicians who performed spinal surgeries and used their devices. Sabit admitted to the Justice Department that he convinced his hospital to buy Apex products in exchange for the opportunity to invest in the company and share in its profits. This conflict of interest caused Sabit to think more about profit than the wellbeing of his patients. In fact, he admitted to using more Apex devices than he should have in surgeries, which resulted in serious injuries to his patients.

This case is a tragic example of a doctor forsakes the Hippocratic oath and puts profits over the health and safety of his patients. It also demonstrates some of the inherent conflicts that can exist in PODs. If you have firsthand information concerning health care fraud or misconduct on the part of doctors involved in a POD, contact a whistleblower attorney to discuss your options.

Whistleblower to Receive $2.66 Million Reward for Bringing Medicare Fraud Allegations to Government

Sixteen hospitals and their parent companies will pay over $15 million to resolve whistleblower allegations claiming the hospitals submitted claims for Medicare services that were inappropriate and medically unnecessary. The Justice Department announced that the whistleblower who brought the alleged fraud to the government’s attention will receive a $2.66 million reward.

ambulance-1334534-mThis case centered on Intensive Outpatient Psychotherapy (IOP) services, which are continued outpatient psychiatric services and treatments for individuals with mental disorders. Medicare will pay for IOP treatment if it is medically reasonable and necessary for diagnosing and treating a patient’s condition.

Starting in 2005 and in some cases continuing into 2013, the Justice Department claims that the hospitals in question billed Medicare for services even though patient conditions did not qualify for IOP. In other cases, the care provided was deemed inappropriate for patients, or not therapeutic. Allegiance Health Management—a post-acute healthcare management company based in Louisiana—typically provided IOP services on the hospitals’ behalf. Nonetheless, it was the hospitals that billed Medicare for the services.

Below are the providers that were included in the settlement agreement:

–    Health Management Associates Inc. and 14 other hospitals the company owns and operates in Mississippi, North Carolina, Georgia, Arkansas, Florida, Texas and Oklahoma will collectively pay $15 million.

–    North Texas Medical Center in Texas will pay $480,000.

–    Community Health Systems and subsidiary Wesley Medical Center in Mississippi will pay $210,000.

Similar charges against LifePoint Hospitals Inc. were settled for $4.67 million in 2013.

This case was initially brought to the government’s attention after a whistleblower filed a qui tam lawsuit under the False Claims Act, which allows individuals (known as relators) to file a lawsuit on the government’s behalf and share in any money recovered. If the government intervenes in a qui tam claim, the relator is typically entitled to between 15 and 25 percent of the recovered damages. In successful cases where the government does not intervene, that percentage can reach as high as 30 percent.

Kentucky Optometrist to Pay $1.2 Million Back to Government Over False Claims

A federal jury has found a Kentucky optometrist liable for seeking Medicare reimbursement for more than 11,000 medically unnecessary eye examinations. The U.S. Attorney’s Office announced last Friday that Somerset optometrist Dr. Phillip Robinson bilked over $400,000 from the government and will be required to pay back just over $1.2 million.

optometry-903400-mDr. Robinson provided optometry services between 2007 and 2012 at roughly a dozen nursing facilities scattered throughout Kentucky. According to evidence presented at the trial, Dr. Robinson performed eye examinations once a month for the vast majority of his nursing home patients, regardless of their medical needs. Medical experts that testified at Robinson’s trial said they did not know of any other optometrist that provided eye exams with such regularity.

Medicare will only pay for care that helps improve a patient’s health and is considered medically necessary. According to Lex 18, Dr. Robinson intentionally submitted roughly 11,085 claims for Medicare reimbursement based on thousands of eye exams that the jury found were not medically necessary.

In a related matter, Dr. Robinson’s practice group—Associates in Eye Care—agreed to pay the government $800,000 earlier this year to settle similar claims against it, thereby avoiding trial. In that case, the government claimed that Dr. Robinson saw so many patients on a daily basis that it was impossible for all to receive legitimate eye exams.

When health care providers are found liable for fraud under the False Claims Act, they are usually excluded from participating in federal health care programs like Medicare and Medicaid. The Department of Health and Human Services, Office of Inspector General (HHS-OIG) will soon decide whether Dr. Thompson will be allowed to continue participating in Medicare and Medicaid.

If you have firsthand knowledge of Medicare fraud, contact an experienced whistleblower law firm to discuss your options.

South Florida Doctor Facing Criminal Charges Over Medicare Advantage Fraud Allegations

A criminal case against a south Florida doctor is taking aim at the Medicare Advantage industry. Isaac Kojo Anakwah Thompson, a doctor affiliated withstethoscope-942045-m—one of the largest providers of private Medicare Advantage plans in the country—was indicted in February on eight counts of health care fraud. Thompson allegedly claimed that his patients were sicker than they actually were, allowing him to overbill the government for medically unnecessary care. In total, he’s accused of bilking over $2 million from Medicare.

Medicare Advantage is different than standard Medicare, which pays doctors in accordance with each service they provide. In contrast, Medicare Advantage plans are offered by private companies and based on a set monthly fee for each patient. Each patient’s fee is based on a complex formula known as a risk score. Generally speaking, the government pays higher rates for sicker patients and lower rates for those in good health.

According to the Center for Public Integrity, Medicare Advantage overcharges have cost taxpayers billions of dollars over the last few years. In the face of these overcharges, whether intentional or not, the Obama administration has proposed $36 billion to be cut from Medicare Advantage plans over the next decade. As expected, the industry has mounted a massive campaign in D.C. to stop government attempts to reduce Medicare Advantage funding.

At present there are several ongoing whistleblower lawsuits involving Medicare Advantage fraud allegations:

  • Florida doctor Olivia Graves claims that a Humana medical center knowingly misdiagnosed patients to seem in poorer health than they actually were, all in the name of overbilling the government.
  • A whistleblower lawsuit claims that a California company abused the diagnosis process to inflate risk scores.
  • A former official in the Bush administration has accused a provider in Puerto Rico of overbilling Medicare hundreds of millions by misdiagnosing patients.

All of the above companies have denied any wrongdoing.

While it is important that companies be held accountable for any wrongdoing, it is unlikely that civil settlements alone will have the desired impact. But bringing criminal charges that carry a maximum jail sentence of up to 10 years ups the ante dramatically for health care fraudsters. Hopefully this will carry a message—if you steal from the government, you will face jail time.

Georgia Hospital to Settle Medicare Fraud Charges for $20 Million

The second largest hospital in the state of Georgia has agreed to pay $20 million to resolve claims that it submitted false claims to Medicare, which caused the government to pay significantly more than it should have for the hospital’s services. Based in Macon, the Medical Center of Central Georgia (MCCG) allegedly billed Medicare for expensive inpatient care when it was actually providing less costly outpatient care.

Hospitals generally receive significantly higher Medicare reimbursement for inpatient services as opposed to outpatient services. The government contends that between 2004 and 2008, MCCG knowingly billed Medicare for medically unnecessary inpatient admissions when the care that it actually provided should have been billed as outpatient or observation services.

usa-dollar-bills-1431130-mIn addition to the $20 million, the settlement also requires the company to maintain an independent review organization for a period of five years to ensure the accuracy of its claims for services provided to Medicare beneficiaries.

Today’s settlement shows what can happen when health care companies provide services based on financial rewards rather than the health and wellbeing of their patients. Medicare beneficiaries should feel secure in knowing that the care they are receiving is beneficial and medically necessary. When providers choose care based solely on what generates the most revenue, it jeopardizes the health of Medicare beneficiaries who are some of our most vulnerable citizens and makes taxpayers pay for it.

This case highlights the need for whistleblowers to come forward and expose corporate wrongdoing. If you have inside information about health care fraud, you should speak to an experienced whistleblower attorney as soon as possible to discuss your claim. Those who come forward and blow the whistle on health care fraud are eligible to receive sizable financial rewards if a claim is successful. They also play an integral role in saving taxpayer dollars and preserving the integrity of government programs like Medicare and Medicaid.