Fraud Report-Criminals in the U.S. Healthcare System

Fraud Report U.S. Healthcare-Corporate Greed and Justice Intervention

Americans have been conditioned to view healthcare fraud as a crime perpetrated by Medicaid cheats, but the curtain is being pulled on corporate fraud, which costs healthcare consumers so much more than welfare opportunists.  This week, criminal trials begin for executives at two different companies, Allergan’s Warner Chilcott unit, a pharmaceutical company and Johnson and Johnson, a medical device manufacturer, at the federal court in Boston.[1] The justice department decided the billions in corporate fines were not sufficiently deterring corporate misconduct in healthcare and has started to pursue criminal charges for white collar criminals who here-to-for thought they could pay a fine and walk. The individuals in the chart below have been indicted by a federal grand jury and will stand trial:

Corporate Fraud

Pharmaceutical Industry	Allergan subsidiary Warner Chilcott has already plead guilty to healthcare fraud and paid a $125,000,000 fine	W. Carl Reichel, ex-president of Warner Chilcott	Kickbacks (bribes) to healthcare providers	Applies to Atlevia, for osteoporosis and other drugs
Medical Device Industry	Johnson & Johnson subsidiary, Acclarent	William Facteau, former CEO and Patrick Fabian, former Vice President of Sales	Promoting unauthorized use of a sinus opening device (fraud) and securities fraud for nondisclosure	Spiking sales for a balloon device used for sinus procedures by promoting it as a steroid delivery device to inflate share price

(Division April 15, 2016)[2]

Fraud Report- Criminals in our Healthcare system

Due to the plethora of convicted criminals in healthcare, each table will show the crime by classification for 2016 and is all drawn from the U.S. Health & Human Services Fraud Report. (Services 2016) Also, only individuals working in the healthcare industry who committed the crimes are listed, not other nefarious opportunists. Also, Stark Law violations, which create fines for hospitals which have privileged financial relationships with community based physicians are not listed because that would generate an entire article.

Drug Dealers

Prescription Drug Fraud, money laundering, conspiracy	Kentucky Anesthesiologist	Convicted May 12th, Jaime Guerrero; sentenced to 100 months (8.3 years) in prison	Unlawful distribution of a controlled substance	Prescribing Hydracodone without medical necessity
Prescription Drug Fraud, money laundering	Pennsylvania Drs. Alan Summer, Azad Khan, Keyhosrow Parsia	Indicted May 11th	Unlawful distribution of a controlled substance	Unlawful sale of Klonopin and Suboxene for cash
Fraudulent prescriptions	Pennsylvania, Dr. John Terry	Sentenced-plea bargained January 5th	Fraudulent prescriptions	Unlawful prescriptions for oxycodone
Fraudulent prescriptions worth $20,000,000	California, Dr. Kenneth Johnson	Sentenced to a 108th months (9 years) prison term January 6th	Fraudulent prescriptions written out of sham medical clinic in Glendale	Pre-signed thousands of prescriptions
Fraudulent prescriptions	West Virginia, Dr. Jose Jorge Abbud Gordinho	Plead guilty January 7th	Fraudulent prescriptions	Unlawful prescriptions for hydrocodone
Conspiracy to distribute narcotics	New York, Dr. Kevin Lowe	Found guilty May 4, 2015, sentenced January 11, 2016 to 144 months in prison (12 years)	Owned Astramed, a clinic in the Bronx, NYC	Unlawful distribution of oxycodone

Medicare Fraud-Overbilling or False Claims

These criminals are listed in descending order from the beginning of 2016

Defrauding Medicare of $4,500,000	California	Hovik Simitian, sentenced to 78 months (6 ½ years) in prison, January 2nd	Included 3 clinics: Columbia Medical, Safe Health, and Life Care	Fraudulent claims
Over billing Medicare $7,800,000	Tennessee Nashville Pharmacy Services, LLC	Kevin Hartman, majority shareholder agreed to the plea		Over billing for Aids and HIV medications
Fraudulent claims of $70,000,000	Florida	Transportation Services Providers Inc. Damian Mayol, sentenced January 8th	Included 3 clinics and involved mental health patients	Involved kickback payments and billing for unnecessary services
Fraudulent claims, $63,000,000	Florida	Nery Cowan plead guilty January 14th, sentenced on March 25th to 60 months (5 years) in prison	Ms. Cowan was a consultant and Medicare biller for Greater Miami Mental Health Center	Directed kickback payments and received a percentage of Medicare reimbursements
Fraudulent claims, $375,000,000	Texas	Patricia Akamnonu, RN sentenced to 10 years and ordered to pay $25,000,000 in restitution on January 19th	Founder of Ultimate Care Home Health Services Inc.	Fraudulent claims for home health care services
Fraudulent claims, $57,000,000, healthcare fraud, wire fraud, conspiracy	Florida	Khaled Elbeblawy, convicted of fraud, January 22, sentenced to	Jem Home Health Care, Healthy Choice Home Health Care, Willsand Home Health Agency Inc.	Fraudulent claims for home health care services

Medicare Fraud-Unnecessary Medical Services

False Claims	Virginia, Bostwick Laboratories	Dr. David G. Bostwick, sentenced January 8th, ordered to pay $3,700,000 fine	False claims for unnecessary services and kickbacks to physicians	Unnecessary cancer detection services
False Claims	Nationwide rehabilitation services provider, Kindred Rehabcare	Company Agreed to pay $125,000,000 to the government on January 12th	False claims for skilled nursing facility services	False claims for unnecessary rehabilitation services
False Claims	Illinois, convictions for officers of Mobile Doctors had already been procured	Dr. Banio Koroma, Mobile Doctors convicted of federal fraud, on January 25th, sentencing set for June 6th	Certified patients were home bound when they were not	False claims for unnecessary home health care services
False Claims for $1,500,000	California	Amalya Cherniavsky, owner of California Medical Equipment Supply Company	False claims for unnecessary services	Kickbacks for prescriptions for unnecessary medical equipment

[3]

As you may have surmised, there are so many fraud cases, I have only been able to illustrate the month of January 2016 in this article, so certainly this topic needs revisiting on a regular basis. Let’s all give a big thank you to the hard working folks at the Medicare Fraud Strike Force-your government dollars working effectively to cut fraudulent waste in the healthcare system. The next time you hear someone complaining about all of the focus on fraud in the healthcare system and how it is unnecessary, feel free to refer them to this handy summary. And this is the healthpolicymaven signing off wishing you fully informed consent in all of your health care decision making.

The healthpolicymaven is a trademark of Roberta E. Winter and Praevalere Inc. Feel free to share this article virally. Roberta Winter is the author of http://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

Works Cited

Division, Federal Drug Agency-Enforcement. April 15, 2016. Former Acclarent, Inc. Executives Charged with Securities Fraud and Crimes Related to Sale and Distribution of Medical Devices. United States Department of Justice Proceeding, U.S. Health and Human Services, Boston: U.S. Department of Health and Human Services. Accessed May 23, 2016. http://www.fda.gov/ICECI/CriminalInvestigations/ucm443650.htm.

Loftus, Peter. 2016. "Ex-Health Executives Go on Trial." Wall Street Journal, May 23: B1-B2.

Services, U.S. Health & Human. 2016. "Healthcare Fraud Report." Health & Human Services. Accessed May 23, 2016. http://oig.hhs.gov/fraud/enforcement/criminal/.

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[1] Loftus, Peter. 2016 “Ex-Health Executives Go On Trial.” Wall Street Journal, May 23: B 1-2

[2] http://www.fda.gov/ICECI/CriminalInvestigations/ucm443650.htm

[3] https://www.justice.gov/opa/pr/president-miami-based-transportation-company-sentenced-60-months-prison-role-70-million