WASHINGTON--The Health Care Fraud and Abuse Control program recovered more than $1.5 billion last year, and has recouped $8.8 billion since 1997, according to a report from the HHS Office of Inspector General.
The program also returned more than $63 million in federal Medicaid dollars to CMS.
The Health Care Fraud and Abuse Control was established by Congress in the Health Insurance Portability and Accountability Act of 1996 to coordinate federal, state and local law enforcement efforts for health care fraud and abuse.
Last year, the Department of Justice opened 935 new criminal health care fraud investigations involving 1,597 potential defendants. Also, more than 1,600 criminal investigations involving health care fraud were conducted in 2005, with more than 2,600 potential defendants.
During the year, more than 520 defendants were convicted for health care fraud crimes. The DOJ also opened more than 775 new civil health care fraud investigations with more than 1,300 civil cases pending.
Among the DME examples cited in the report:
- Polymedica Corp. and its subsidiaries Liberty Medical Supply and Liberty Home Pharmacy Corp. agreed to pay the U.S. $35 million to resolve allegations that they submitted improper claims to Medicare for various diabetic and nebulizer products. Claims were allegedly submitted without a required doctor's order or prescription, and the companies failed to obtain and maintain documentation verifying the necessity of the level of treatment rendered. The companies also allegedly billed Medicare without written authority from a patient to do so. Under terms of the settlement, Polymedica agreed to comply with a corporate integrity agreement negotiated by HHS/OIG.
- The owner of a California medical supply company pled guilty to health care fraud for billing Medicare for power wheelchairs, hospital beds and other equipment that was never prescribed by a physician, and never received by the beneficiaries. The individual was charged with having defrauded Medicare of $2.4 million over five years. As part of the plea agreement, the owner agreed to forfeit his home, vehicles and bank accounts to pay restitution to the government.
- The owner of a medical equipment company in Oklahoma was sentenced to serve five months in prison and to pay more than $340,000 in restitution after pleading guilty to health care fraud. She admitted to forging doctors' names on phony CMNs. She furnished patients with scooters valued at $1,500, but billed the Medicaid program for power wheelchairs at $5,000.
- Apria Healthcare Group paid the U.S. $17.6 million to settle two civil FCA cases filed by former employees. The settlements resolved allegations that from mid-1995 through 1998, Apria submitted false documents certifying medical necessity; failed to obtain written prescriptions from physicians prior to delivery of equipment when required to do so; failed to notify patients of their option to purchase DME; and misrepresented the date or place equipment was delivered to patients.
- United Healthcare Insurance Co. agreed to pay the U.S. $3.5 million to settle allegations that the company defrauded the Medicare program. As a former DME regional carrier, United contracted with CMS to process Medicare DME claims submitted by providers, suppliers and beneficiaries in the Northeast. The government alleged that United's telephone response unit knowingly mishandled phone inquiries from Medicare beneficiaries and providers, and then falsely reported its performance information to CMS concerning the company's handling of those calls.
To view the full report, click here.
Provider News
Supreme Court Won't Hear Appeal by AHP Debt
Holders
BRENTWOOD, Tenn.--The U.S. Supreme Court has declined to hear an
appeal by American HomePatient's senior debt holders, ending the
group's efforts to overturn the company's bankruptcy reorganization
plan, approved in 2003.
The provider, which operates 263 centers in 34 states, filed for Chapter 11 in 2002 and fought with creditors over its reorganization plan, which rejected the warrants issued to the debt holders before the bankruptcy, the Nashville Business Journal reported. The warrants, which represented about 20 percent of AHP's outstanding common stock, would have allowed the lenders to buy about 3.2 million shares of the company's common stock for 1 cent per share.
On July 1, 2003, the company emerged from its 11-month reorganization with a plan giving it until 2009 to pay $250 million in debt.
American HomePatient posted revenues of $328.4 million in 2005, down $7.4 million from the previous year. Earlier this year, the company, which has struggled with declining Medicare reimbursement rates, considered a buyout bid from Highland Capital Management.