Harborside Healthcare settles kickback allegations for nearly $1.4 million. Boston-based Harborside Healthcare, which owns and operates long-term care facilities across the country, and its subsidiary, HHC Nutrition Services [edit correct?], agreed in October to pay the federal government nearly $1.4 million to resolve allegations that the company received kickbacks and assistance for purchasing durable medical equipment from McKesson Corp. and its affiliate MediNet Corp. Harborside then allegedly billed Medicare for the goods it had received kickbacks for, thus violating the False Claims Act.
In addition to paying $1.4 million, Harborside agreed to forego $498,000 in DME claims that had not yet been billed to Medicare. The suit was initiated by a whistleblower who will receive $275,000 from the government’s recovery.
Physical therapist and company owner plead guilty to Michigan physical therapy fraud scheme. Syed Aziz, a licensed physical therapist based in Troy, Mich., admitted in late October to accepting kickbacks to falsify documents and pleaded guilty to participating in a conspiracy to defraud the Medicare program of approximately $1.9 million between May 2005 and Dec. 2006. Mr. Aziz admitted to creating fictitious therapy files and other documents falsely indicating that he had provided physical and occupational therapy services to the Medicare beneficiaries that never needed or received such services, and was paid between $70 and $90 for each file he falsely created. The total billed to Medicare for the false claims with Mr. Aziz’s signature was around $1.9 million, of which Medicare paid approximately $817,000. Mr. Aziz also admitted to paying Medicare beneficiaries cash kickbacks and other inducements in exchange for their Medicare numbers.
Mr. Aziz’s co-conspirator in the fraud scheme, Suresh Chand, owned and controlled several purported physical therapy companies in the Detroit area and used Mr. Aziz to provide his signature as a licensed physical therapist in order to bill the services to Medicare. Mr. Chand oversaw the scheme to submit false claims by a number of his facilities, which totaled $18.3 million in false claims to Medicare. Mr. Chand pleaded guilty for his role September. Mr. Aziz faces a maximum prison sentence of 10 years and a $250,000 fine and will be sentenced in Feb. 2010. Mr. Chand faces a maximum of 30 years in prison and a $750,000 fine. He will be sentenced in Jan. 2010.
Detroit infusion clinic employees charged for alleged $2.3 million Medicare fraud scheme. Juan De Oleo, part-owner of the X-Press Center, a Detroit-area clinic that purported to specialize in providing injection and infusion therapies; Rosa Genao, MD, a physician at the clinic; and Ingrid Mazorra, the clinic’s office manager, were each indicted for conspiracy to commit healthcare fraud and five counts of substantive healthcare fraud for their roles an alleged scheme to defraud Medicare of $2.3 million. In addition, a former manager at X-Press Center pleaded guilty to one count of conspiracy to commit healthcare fraud in connection with her management of the clinic.
Mr. De Oleo and his co-conspirators allegedly opened a fraudulent infusion and injection therapy clinic and agreed to split the proceeds of the fraud scheme. According to the indictment, Medicare beneficiaries received kickbacks in return for visiting the clinic and signing forms indicating that they received treatments that were medically unnecessary or never provided. The indictment also alleges that Dr. Genao and Ms. Mazorra altered, falsified and destroyed patient records to attempt to justify the medically unnecessary services that were purportedly being provided at the clinic. The three face up to 10 years in prison and a $250,000 fine for the healthcare fraud charges alone. A trial date has not yet been announced.
Houston DME company employees charged for alleged scheme to defraud Medicare. Kate Nkuku and Oliver Nkuku, the owners and operators of KO Medical, a Richmond, Texas-based DME company, were charged in July for their roles in an alleged scheme to defraud Medicare, resulting in more than $931,000 in false claims. Ms. Nkuku and Mr. Nkuku allegedly billed Medicare for power wheelchairs under special codes indicating that a new piece of DME was being provided as a replacement for a similar piece of DME that was lost, damaged or destroyed during a natural disaster, such as a hurricane. Use of this modifier when a bill is submitted to Medicare allows DME to be billed without a physician’s prescription because it is merely intended to replace a destroyed item that Medicare presumes was initially obtained with a proper prescription. According to the indictment, only some of the beneficiaries actually received the chairs, and none of the beneficiaries who received the replacement chairs needed one. Two other KO Medical employees were also indicted for delivering the allegedly unnecessary DME to the beneficiaries.
In October, co-conspirator Charles Roberts was also indicted for his role in the scheme, which included recruiting Medicare beneficiaries to KO Medical. Ms. Nkuku and Mr. Nkuku allededly paid Mr. Roberts a kickback of $400 each time Medicare paid for a power wheelchair for a beneficiary he referred. Ms. Nkuku’s and Mr. Nkuku’s indictment did not mention whether or not the Medicare beneficiaries received any kickbacks for providing their Medicare information to the company. Trial dates have not been set for the defendants.
Washington physician charged with defrauding Medicare by billing for services not provided. Antoine Johnson, MD, formerly of Aberdeen, Wash., was charged in January with conspiracy to commit healthcare fraud. Dr. Johnson owned four medical clinics in Western Washington, located in Aberdeen, Olympia, Lakewood and Tacoma. The clinics were investigated by the Washington State Department of Social and Health Services for improper Medicaid billing practices and by the Grays Harbor County Drug Task Force for allegedly dispensing narcotic prescriptions for cash payments. Law enforcement officials sent undercover agents posing as patients to visit the clinics on multiple occasions. Law enforcement officials then reviewed the bills sent to the state for the visits involving the agents and found that the clinics billed for a higher level of service than was actually provided and for services not provided, according to the Department of Justice. Officials issued an arrest warrant for Dr. Johnson, but he was initially not located. In October, Dr. Johnson was detained in Madagascar for traveling on an expired U.S. passport. When officials from Madagascar learned of the arrest warrant, they began proceedings to deport him. Dr. Johnson agreed to return to the United States voluntarily to appear in U.S. court. Dr. Johnson’s mother, Lawanda Johnson, is also charged for her involvement in the clinic’s billing practices. She remains a fugitive, according to the Department of Justice.
