PRESIDENT ANNOUNCES OPPOSITION TO CUTTING RETIREMENT SECURITY FOR CURRENT/FUTURE BENEFICIARIES

FROM:  U.S. DEPARTMENT OF HEALTH AND HUMAN RESOURCES
President Announces New and Enhanced Initiatives to Support Older Americans
Feb 05, 2015

By: Nora Super, Executive Director, White House Conference on Aging

The President’s 2016 Budget will help ensure that older Americans enjoy not only longer but healthier lives. The Budget makes a number of commitments to enhance, advance, and create opportunity for older Americans, especially in the four focus areas of the 2015 White House Conference on Aging: retirement security, healthy aging, long-term care services and supports, and elder justice.
Let me say a little about a few of the Budget items in each area of focus:
To enhance retirement security, the President is committed to ensuring that Social Security is solvent and viable for the American people, now and in the future.  The Administration will oppose any measures that privatize or weaken the Social Security system and will not accept an approach that slashes benefits for future generations or reduces basic benefits for current beneficiaries.

Additionally, as many as 78 million working Americans - about half the workforce - don't have a retirement savings plan at work. Fewer than 10 percent of those without plans at work contribute to a plan of their own. The President’s Budget expands retirement opportunities for all Americans to help families save and give them better choices to reach a secure retirement.

To support healthy aging, the Budget proposes a set of initiatives to strengthen Medicare by more closely aligning payments with the costs of providing care, encouraging health care providers to deliver better care and better outcomes for their patients, and improving access to care for beneficiaries. In addition, the Budget includes proposals that would build a stronger foundation for Medicare's future.

To provide relief from increased prescription drug costs, the Budget proposes to close the Medicare Part D donut hole for brand drugs by 2017, rather than 2020, by increasing discounts from the pharmaceutical industry. The Budget also proposes to provide the Secretary of Health and Human Services with new authority to negotiate with manufacturers on prices for high cost drugs and biologics covered under the Part D program. These proposals represent a few amongst a range of potential options, and the Administration looks forward to working with Congress to address growing drug costs.

Recognizing the importance of nutrition to healthy aging, the Budget provides over $874 million for Nutrition Services programs, a $60 million increase over the 2015 enacted level, allowing States to provide 208 million meals to over 2 million older Americans nation-wide, helping to halt the decline in service levels for the first time since 2010.  In addition, the Budget helps provide supportive housing for very low-income elderly households, including frail elderly, to allow seniors to age in a stable environment and help them access human services.
To ensure older individuals and people with disabilities receive services in the most appropriate setting, the Budget proposes expanded access to Medicaid home and community-based long-term care services and supports. First, the Budget expands and simplifies eligibility to encourage more States to provide home and community-based care in their Medicaid programs. The Budget proposes expanding and improving the “Money Follows the Person”
Rebalancing demonstration, which helps States provide opportunities for older Americans and people with disabilities to transition back to the community from institutions. The Budget also includes a comprehensive long-term care pilot for up to five States to test, at an enhanced Federal match rate, a more streamlined approach to delivering long-term care services and supports to support greater access and improve quality of care.

The Budget also includes increased discretionary resources for the Aging and Disability Resource Centers (ADRCs) program, which make it easier for Americans nation-wide to learn about and access their health and long-term care services and support options. ADRCs support State efforts to create consumer-friendly entry points into long-term care services at the community level.
The Family Support Initiative will assist family members supporting older adults or people with disabilities across the lifespan. It will complement nearly $50 million in new resources for existing aging programs that are already providing critical help and supports to seniors and their caregivers, such as respite and transportation assistance.

To support evidence-based interventions to reduce elder abuse, neglect and financial exploitation, the Budget includes $25 million in discretionary resources for Elder Justice Act programs authorized under the Affordable Care Act. These resources will support standards and infrastructure to improve detection and reporting of elder abuse; grants to States to pilot a new reporting system; and funding to support a coordinated Federal research portfolio to better understand and prevent the abuse and exploitation of vulnerable adults.

Taken together, these and other initiatives in the Budget will help to change the aging landscape in America to reflect new realities and new opportunities for older Americans, and they will support the dignity, independence, and quality of life of older Americans at a time when we’re seeing a huge surge in the number of older adults.

As many of you are aware, 2015 marks the 50th Anniversary of Medicare, Medicaid, and the Older Americans Act, as well as the 80th Anniversary of Social Security. The commitments made to support older adults in the President’s Budget are a fitting way to mark these anniversaries, and to help fulfill the promise of a better future for older Americans—and for all of us—that is inherent in these landmark pieces of legislation.

PHARMACY SETTLES ALLEGATIONS IT USED GIFT CARDS AS INDUCEMENTS FOR MEDICARE, MEDICAID PATIENTS

FROM:  U.S. JUSTICE DEPARTMENT
Wednesday, December 3, 2014
Rite Aid Corporation Pays $2.99 Million for Alleged Use of Gift Cards to Induce Medicare and Medicaid Business

Rite Aid Corporation, a Delaware corporation and national retail drugstore chain with its principal place of business in Camp Hill, Pennsylvania, has paid the United States $2.99 million to resolve allegations that it violated the False Claims Act by inappropriately using gift cards as inducements, the Department of Justice announced today.

The settlement resolves allegations that Rite Aid offered illegal inducements to Medicare and Medicaid beneficiaries to transfer their prescriptions to Rite Aid pharmacies.  The government alleged that from 2008 to 2010, Rite Aid had knowingly and improperly influenced the decisions of Medicare and Medicaid beneficiaries to transfer their prescriptions to Rite Aid pharmacies by offering them gift cards in exchange for their business.

“This case demonstrates the government's ongoing commitment to enforcing accountability, transparency and fairness in the retail pharmacy industry,” said Acting Assistant Attorney General Joyce R. Branda for the Civil Division.  “The government will continue to advocate for the best interests of Medicare and Medicaid patients, and prevent pharmacies from improperly manipulating their healthcare choices.”

“This settlement holds Rite Aid accountable for exerting undue influence on individuals when they make important healthcare decisions about where and when to fill prescriptions,” said Acting U.S. Attorney Stephanie Yonekura for the Central District of California.  “Corporate profit should never steer an individual away from making the right healthcare decision.”

“Pharmacies are not allowed to improperly influence the decision-making of Medicare and Medicaid patients about where to fill prescriptions,” said Special Agent in Charge Glenn R. Ferry for the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG).  “Pharmacy chains that manipulate patient choices in this way will be held accountable.”

The settlement resolves allegations filed by Jack Chin under the qui tam, or whistleblower provisions of the False Claims Act, which authorizes private parties to sue for fraud on behalf of the United States and share in the recovery.  Chin will receive approximately $508,300 of the settlement.      

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $23.2 billion through False Claims Act cases, with more than $14.9 billion of that amount recovered in cases involving fraud against federal health care programs.

This case was investigated jointly by the Commercial Litigation Branch of the Civil Division, the U.S. Attorney’s Office for the Central District of California, the National Association of Medicaid Fraud Control Units and HHS-OIG.

The claims settled by today’s agreement are allegations only and there has been no determination of liability.

SLEEP THERAPY CO. SETTLES ALLEGATIONS OF VIOLATING FALSE CLAIMS ACT

FROM:  THE JUSTICE DEPARTMENT
Monday, December 1, 2014
Government Settles False Claims Act Allegations Against Oxygen and Sleep Therapy Company

North Atlantic Medical Services Inc. (NAMS), doing business as Regional Home Care Inc., has agreed to pay $852,378 to resolve allegations that it violated the False Claims Act by submitting claims to Medicare and Medicaid for respiratory therapy services provided by unlicensed personnel, the Department of Justice announced today.  NAMS is a medical device company based in Massachusetts that provides equipment and services for the treatment of respiratory ailments, such as oxygen deficiency and sleep apnea. 

“Respiratory care services should be performed by properly licensed personnel,” said Acting Assistant Attorney General Joyce R. Branda for the Civil Division.  “We will not tolerate companies prioritizing their own profits and convenience at the expense of patient safeguards.”   

Medicare and Medicaid require suppliers of respiratory therapy equipment and services to comply with state licensing standards.  In Massachusetts, the Department of Public Health requires respiratory therapists to apply for and obtain a license.  Applicants can do so by passing the National Board for Respiratory Care’s “Certification Examination for Entry-Level Respiratory Therapy Practitioners” or obtaining a reciprocal license from a different jurisdiction.  This settlement resolves allegations that, from September 2010 to January 2013, NAMS used unlicensed employees to set up sleep apnea masks and oxygen therapy equipment for patients in Massachusetts.  The government alleged that, even after the Massachusetts Department of Public Health informed the company that the practice was illegal, NAMS continued to use unlicensed personnel and bill Medicare and Medicaid for these services.

“This respiratory care company flouted important licensure requirements, failed to provide patients the standard of care that they deserve and fraudulently billed the federal government for improperly rendered services,” said U.S. Attorney Carmen M. Ortiz for the District of Massachusetts.  “With the important assistance of whistleblowers, our health care fraud team seeks to ensure patient safety and protect the public fisc.”

“To safeguard patient health and ensure that taxpayer money is spent well, Medicare and Medicaid require providers of respiratory care services to follow state licensure rules,” said Special Agent in Charge Phillip M. Coyne for the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG).  “Companies seeking to boost profits by using unlicensed personnel will be held accountable for their actions.”

Medicaid is jointly funded by the states and federal government.  The Commonwealth of Massachusetts, which paid in part for the Medicaid claims at issue, will receive $229,210 of the settlement amount.

The government’s investigation was initiated by a qui tam, or whistleblower, lawsuit filed under the False Claims Act by former NAMS employees Konstantinos Gakis and Demetri Papageorgiou.  The False Claims Act allows private citizens to file suit for false claims on behalf of the government and to share in the government’s recovery.  Gakis and Papageorgiou will receive $153,428.  

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $23.2 billion through False Claims Act cases, with more than $14.9 billion of that amount recovered in cases involving fraud against federal health care programs.

This settlement was the result of a coordinated effort by the Civil Division, the U.S. Attorney’s Office for the District of Massachusetts, FBI, HHS-OIG, and the Commonwealth of Massachusetts.

U.S. FILES LAWSUIT CLAIMING COMPANY BILLED GOVERNMENT FOR INELIGIBLE PATIENTS

FROM:  U.S. JUSTICE DEPARTMENT
Tuesday, November 25, 2014
United States Files False Claims Act Lawsuit Against Las Vegas Hospice and Related Entities for Billing Medicare and Medicaid for Ineligible Patients

The United States has filed suit against Creekside Hospice II LLC, Skilled Healthcare Group Inc. (SKG), its holding company, and Skilled Healthcare LLC (SKH), an administrative services subsidiary of SKG that operates Creekside (collectively the Creekside entities), alleging that these entities knowingly submitted ineligible claims for hospice services and inflated claims for patient visits to government health care programs, the Justice Department announced today.

“The Medicare hospice benefit is intended to provide pain management and other palliative care to patients nearing the end of life, to help make them as comfortable as possible,” said Acting Assistant Attorney General Joyce R. Branda for the Civil Division.  “Too often, however, companies abuse this critical service by using aggressive marketing tactics to pressure patients who do not need, and may be ill-served, by these services in order to get higher reimbursements from the government.  The department will take swift action to protect taxpayer dollars and make sure that Medicare benefits are available to those who truly need them.”

The Medicare and Medicaid hospice benefits are available for patients who elect palliative treatment (medical care focused on providing patients with relief from pain and stress) for a terminal illness and have a life expectancy of six months or less if their disease runs its normal course.  When Medicare or Medicaid patients receive hospice services, they no longer receive services designed to cure their illnesses.

The government’s complaint alleges that the Creekside entities knowingly submitted or caused the submission of false claims for hospice care for patients who were not terminally ill.  According to the complaint, the companies allegedly directed staff to enroll patients in the hospice program regardless of the patients’ eligibility for hospice benefits, sometimes by instructing staff to change records after the hospice submitted claims for payment to indicate that all requirements had been met.  Management from Creekside, SKG and SKH also allegedly instructed employees to alter medical records to make it appear that doctors at the hospice had conducted personal visits with the patients, when in fact they had not occurred, in order to ensure reimbursement from Medicare and Medicaid.  The complaint alleges that Creekside management aggressively discouraged staff from permitting patients or their families to revoke their elections to accept hospice benefits.  The complaint also alleges that staff at Creekside were discouraged from documenting known improvements in a patient’s health in the medical record, called “Chart Killers” by the hospice, to ensure that Medicare or Medicaid would pay the hospice’s claim.

Further, the complaint alleges that the Creekside entities knowingly submitted or caused the submission of inflated claims to Medicare for services performed by the medical director.  The government alleges that the companies repeatedly used billing codes that resulted in higher payment by Medicare than were justified by the services actually performed.  As a result of the conduct alleged in the complaint, the government contends that the Creekside entities misspent tens of millions of taxpayer dollars from the Medicare and Medicaid programs. 

“In order to protect the financial integrity of the Medicare and Medicaid programs, upon which so many of our senior American citizens rely, both the Department of Justice (DOJ) and the Department of Health and Human Services (HHS) have made combating healthcare fraud an enforcement priority,” said U.S. Attorney Daniel G. Bogden for the District of Nevada.  “This type of fraud will not be tolerated and DOJ and HHS will act swiftly when it does occur to pursue False Claims Act suits against violators.”

The United States filed its complaint in two consolidated lawsuits brought under the whistleblower provisions of the False Claims Act and the Nevada False Claims Act by Joanne Cretney-Tsosie, a clinical manager for Creekside, and Veneta Lepera, a former clinical manager for Creekside.  Under these statutes, a private citizen can sue for fraud on behalf of the United States and the state of Nevada, respectively, and share in any recovery.  The federal and state governments are entitled to intervene in such a lawsuit, as they have done in this case.

The United States’ suit is part of the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $23.1 billion through False Claims Act cases, with more than $14.8 billion of that amount recovered in cases involving fraud against federal health care programs.

This matter was investigated by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the District of Nevada, the Nevada Attorney General’s Office and the HHS Office of Inspector General.  The claims asserted against Creekside Hospice, SKG and SKH are allegations only and there has been no determination of liability.

FLORIDA HOSPITAL CEO PLEADS GUILTY FOR ROLE IN $67 MILLION MENTAL HEALTH CARE FRAUD CASE

FROM:  U.S. JUSTICE DEPARTMENT 
Tuesday, November 18, 2014
Miami-Area Hospital Chief Operating Officer Pleads Guilty in $67 Million Mental Health Care Fraud Scheme

The former chief operating officer of a Miami-area hospital pleaded guilty today for his role in a mental health care fraud scheme that resulted in the submission of more than $67 million in fraudulent claims to Medicare by a state-licensed psychiatric hospital located in Hollywood, Florida, that purported to offer both inpatient and outpatient mental health services.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the U.S. Health and Human Services Office of Inspector General’s (HHS-OIG) Florida region made the announcement.

Christopher Gabel, 61, of Davie, Florida, the former Chief Operating Officer (COO) of Hollywood Pavilion LLC (HP), pleaded guilty before U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and pay and receive health care kickbacks.  Gabel was charged in an indictment returned on May 8, 2014.

According to Gabel’s admissions in connection with his guilty plea, between April 2003 and September 2012, HP submitted false and fraudulent claims to Medicare for treatment that was not medically necessary or not provided to patients.  As COO during that time, Gabel supervised HP’s staff at both its inpatient and outpatient facilities, where Medicare beneficiaries were admitted to HP regardless of whether they qualified for mental health treatment, and were often admitted before seeing a doctor.

Gabel admitted that HP obtained Medicare beneficiaries from across the country by paying bribes and kickbacks to various patient brokers.  Gabel instructed the patient brokers to falsify invoices and marketing reports in an effort to hide, and cover up the true nature of the bribes and kickbacks they were receiving from HP.  From 2003 through August 2012, HP billed Medicare approximately $67 million for services that were not properly rendered, for patients that did not qualify for the services being billed, and for claims for patients who were procured through bribes and kickbacks.  Medicare reimbursed HP nearly $40 million for those claims.

Karen Kallen-Zury, Daisy Miller, Michele Petrie and Christian Coloma were convicted at trial in June 2013 for their roles in this scheme.  Kallen-Zury, HP’s former chief executive officer, was sentenced to 25 years in prison.  Miller, the clinical director of HP’s inpatient facility, was sentenced to 15 years in prison; and Petrie, the head of HP’s intensive outpatient program, was sentenced to six years in prison.  Coloma, the director of physical therapy for an entity associated with HP, was sentenced to 12 years in prison.  Kallen-Zury, Miller and Petrie were ordered to pay nearly $40 million in restitution, and Coloma was ordered to pay more than $20 million in restitution.

The case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  The case is being prosecuted by Trial Attorneys Nicholas E. Surmacz, Andrew H. Warren and L. Rush Atkinson of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

COMPANY AND AFFILIATES AGREE TO PAY OVER $25 MILLION TO SETTLE FALSE CLAIMS ALLEGATIONS

FROM:  U.S. JUSTICE DEPARTMENT 
Wednesday, November 12, 2014
Careall Companies Agree to Pay $25 Million to Settle False Claims Act Allegations

CareAll Management LLC and its affiliated entities (collectively “CareAll”) have agreed to pay $25 million, plus interest, to the United States and the state of Tennessee to resolve allegations that CareAll violated the False Claims Act by submitting false and upcoded home healthcare billings to the Medicare and Medicaid programs, the Department of Justice announced today.  CareAll is based in Nashville, Tennessee, and is one of Tennessee’s largest home health providers.

“Home health agencies may only bill Medicare and Medicaid for care that is necessary and covered by the programs,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division.  “This settlement is another example of the department’s commitment to ensuring that home health care dollars – which are so vital to ensure the care of homebound patients – are spent for their intended purposes.”

This settlement resolves allegations that between 2006 and 2013, CareAll overstated the severity of patients’ conditions to increase billings and billed for services that were not medically necessary and rendered to patients who were not homebound.    

“This case demonstrates that enforcement of the False Claims Act is a priority of the U.S. Attorney’s Office for the Middle District of Tennessee,” said U.S. Attorney David Rivera for the Middle District of Tennessee.  “The U.S. Attorney’s Office and our law enforcement partners are committed to protecting the public and vigorously pursuing all those who knowingly submit false claims affecting the Medicare and Medicaid programs.”

This is CareAll’s second settlement of alleged False Claims Act violations within the last two years.  In 2012, CareAll paid nearly $9.38 million for allegedly submitting false cost reports to Medicare.  As part of the settlement announced today, the companies agreed to be bound by the terms of an enhanced and extended corporate integrity agreement with the Department of Health and Human Services-Office of Inspector General (HHS-OIG) in an effort to avoid future fraud and compliance failures.

“Fraudulent home-based services are surging across the country,” said Special Agent in Charge Derrick L. Jackson of HHS-OIG in Atlanta.  “We will continue to protect both Medicare and taxpayers, and ensure that funds are not siphoned off by companies more concerned with the bottom line than patient care.”

Under the False Claims Act, private citizens, known as relators, can bring suit on behalf of the United States and share in any recovery.  The relator in this case, Toney Gonzales, will receive more than $3.9 million as his share of the recovery.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of HHS.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $23.1 billion through False Claims Act cases, with more than $14.8 billion of that amount recovered in cases involving fraud against federal health care programs.  

The settlement was the result of a coordinated effort by the Civil Division, the U.S. Attorney’s Office for the Middle District of Tennessee, HHS-OIG and the Tennessee Bureau of Investigation.

The case is docketed as United States ex rel. Gonzales v. J.W. Carell Enterprises, Inc., et al., No. 12-0389 (M.D. Tenn.).  The claims resolved by the settlement are allegations only; there has been no determination of liability.

OPERATORS OF DIAGNOSTIC CENTERS TO PAY $2.6 MILLION SETTLING ALLEGATIONS OF FALSE CLAIMS ACT VIOLATIONS

FROM:  U.S. JUSTICE DEPARTMENT 

Friday, October 17, 2014

Operators of Houston Area Diagnostic Centers Agree to Pay $2.6 Million to Settle Alleged False Claims Act Violations

Two groups of Houston-based diagnostic centers have agreed to pay the United States a total of more than $2.6 million to settle allegations that they violated the False Claims Act, announced Acting Assistant Attorney General Joyce R. Branda for the Department of Justice’s Civil Division and U.S. Attorney Kenneth Magidson for the Southern District of Texas.  The settlements were finalized without an admission of liability and without commencement of litigation.

One group of centers, which operates under the name One Step Diagnostic and is owned and controlled by Fuad Rehman Cochinwala, has agreed to pay $1.2 million.  The payment is being made to settle allegations that it violated the Stark Statute and the False Claims Act by entering into sham consulting and medical director agreements with physicians who referred patients to One Step Diagnostic Centers.

The other group of centers, which is owned and controlled by Rahul Dhawan, has agreed to pay $1,457,686.  This group consists of Complete Imaging Solutions LLC doing business as Houston Diagnostics, Deerbrook Diagnostics & Imaging Center LLC, Elite Diagnostic Inc., Galleria MRI & Diagnostic LLC, Spring Imaging Center Inc. and West Houston MRI & Diagnostics LLC.  The United States alleged that these centers engaged in improper financial relationships with referring physicians and improperly billed Medicare using the provider number of a physician who had not authorized them to do so and had not been involved in the provision of the services being billed.

“The Department of Justice has longstanding concerns about improper financial relationships between health care providers and their referral sources, because such relationships can alter a physician's judgment about the patient's true health care needs and drive up health care costs for everyone,” said Acting Assistant Attorney General Branda.  “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable.”

“These settlements totaling more than $2.6 million represent the continuing commitment of our office in combatting health care fraud,” said U.S. Attorney Magidson.  “The U.S. takes these accusations seriously.  Working within the whistleblower laws, we will continue to bring these cases to public view where tax payer money is being used improperly.”

The settlements announced today arose from a lawsuit filed by three whistleblowers under the qui tam provisions of the False Claims Act.  Under that act, private citizens can bring suit on behalf of the government for false claims and share in any recovery.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $22.5 billion through False Claims Act cases, with more than $14.3 billion of that amount recovered in cases involving fraud against federal health care programs.

The case, United States ex rel. Holderith, et al. v. One Step Diagnostic, Inc., et al., Case No. 12-CV-2988 (S.D. Tex.), was handled by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Southern District of Texas and Department of Health and Human Services - Office of Inspector General.  The claims settled by this agreement are allegations only, and there has been no determination of liability.

ACTING AG DELERY MAKES REMARKS REGARDING EXTENDICARE FALSE CLAIMS ACT CASE

FROM:  U.S. JUSTICE DEPARTMENT

Acting Associate Attorney General Stuart F. Delery Delivers Remarks at Press Conference Announcing False Claims Act Resolution with Extendicare

Washington, DCUnited States ~ Friday, October 10, 2014

Remarks as Prepared for Delivery

Good morning and thank you all for being here today.  I am pleased to be joined by Joyce Branda, the Acting Assistant Attorney General for the Civil Division, as well as Gregory Demske, the Chief Counsel to the Inspector General for the Department of Health and Human Services.

Protecting this nation’s vulnerable populations – including our seniors – has been, and continues to be, one of this department’s highest priorities.  As more and more seniors rely on nursing homes for care, it becomes increasingly important for us to ensure that they receive the services they need.

Today, we are here to announce that Extendicare Health Services – one of the nation’s largest nursing home chains with 146 facilities in 11 states – has agreed to pay $38 million to resolve allegations that certain of its facilities billed the Medicare and Medicaid programs for nursing care services that were so grossly substandard as to be effectively worthless, while also billing Medicare for medically unreasonable and unnecessary rehabilitation therapy services.  This is the largest False Claims Act settlement the department has entered with a nursing home chain involving “failure of care” allegations.

As part of this historic resolution, Extendicare will also enter into a five year chain-wide corporate integrity agreement with the Department of Health and Human Services.  This agreement will contain innovative staffing requirements intended to ensure that this type of misconduct will not happen again.

This significant resolution reflects a convergence of two of the department’s highest priorities.

First, today’s settlement reflects the department’s commitment to protecting the nation’s elderly and most vulnerable citizens from all forms of abuse, neglect, and financial exploitation.  Under this administration, the department has redoubled its efforts in the elder justice arena by funding innovative research, developing training materials for elder abuse prosecutors and legal services lawyers; and by raising public awareness.  In fact, just last month, the department launched its Elder Justice Website, a tremendous resource for prosecutors, practitioners, and most importantly, elder abuse victims and their families.  

Second, today’s settlement reflects the department’s commitment to combatting health care fraud.  Given the growing Medicare eligible population, we must make every effort to protect Medicare funds from fraud, waste, and abuse.  Since the Attorney General and the Secretary for Health and Human Services launched the Health Care Fraud Prevention and Enforcement Action Team initiative in 2009, the department has recovered over $14 billion in cases involving fraud against federal healthcare programs.   The department has aggressively pursued healthcare fraud against virtually every type of healthcare provider and supplier, including hospitals, physicians, hospice providers, and pharmaceutical and device manufacturers.  Today’s settlement with Extendicare is an example of this initiative in action.

Taken as a whole, today’s resolution represents an important achievement on both those fronts.  Our seniors rely on the Medicare and Medicaid programs to provide them with quality care, dignity and respect when they are most vulnerable.  It is, therefore, critically important that we hold accountable those healthcare providers, including nursing home operators, who put their own economic gain over the needs of their residents.

We will pursue with equal vigor those who bill Medicare and Medicaid while failing to provide beneficiaries with the nursing care to which they are entitled and those who provide medically unnecessary services in order to maximize their Medicare billings.  Both of these schemes are forms of elder financial exploitation. Neither will be tolerated by this department.



Finally, before I turn things over to Acting Assistant Attorney General Joyce Branda, I wanted to commend the excellent work of the Extendicare team.  Given the scope of the allegations at issue, the investigation was conducted jointly by the Department of Justice’s Civil Division, several U.S. Attorney’s Offices, agents and attorneys from the HHS Office of Inspector General, as well as attorneys and agents from the Medicaid Fraud Control Units of several states.  This settlement, and the underlying investigation, is a compelling example of how federal and state law enforcement can work effectively together and of what we can achieve when we do so.  I am pleased that we are joined here today by representatives of those offices.

With that, I’m happy to introduce Joyce Branda, the Acting Assistant Attorney General for the Civil Division, who will discuss the Extendicare settlement in more detail.

COURT HALTS TELEMARKETERS WHO CLAIM TO BE WITH MEDICARE

FROM:  U.S. FEDERAL TRADE COMMISSION 

FTC Halts Fake Medicare Scheme that Took Money from Seniors’ Bank Accounts

At the Federal Trade Commission’s request, a federal court halted a telemarketing scheme that tricked senior citizens  by pretending to be part of Medicare, and took millions of dollars from consumers’ bank accounts without their consent. As part of its ongoing work to protect every community from fraud, the FTC seeks to permanently end the operation and return victims’ money.

According to a complaint filed by the FTC, the defendants called consumers – including many whose numbers were listed on the National Do Not Call Registry – and said they were providing a new Medicare card or information about Medicare benefits.

The defendants allegedly misrepresented that they were working on behalf of Medicare, and said they needed to verify consumers’ identities using personal information that included their bank account numbers. The defendants allegedly assured consumers that the information would not be used to debit their bank accounts, and that there was no charge for the new Medicare card or information about Medicare benefits.

However, within a few weeks, consumers learned their bank accounts had been debited either $399 or $448 via remotely created checks (RCCs), the complaint alleges. Despite these charges, consumers did not receive any kind of product or service from the defendants. In some instances, the defendants debited the accounts of consumers they had not even contacted.

The FTC charged the defendants with violating the FTC Act and the FTC’s Telemarketing Sales Rule. The defendants are Sun Bright Ventures LLC, Citadel ID Pro LLC, and Benjamin Todd Workman. The FTC named Trident Consulting Partners LLC and Glenn Erickson as relief defendants who profited from the scheme.

The Commission vote authorizing the staff to file the complaint was 5-0. The FTC filed the complaint, under seal, in the U.S. District Court for the Middle District of Florida. On September 4, 2014, the court entered a temporary restraining order halting the defendants’ deceptive scheme and freezing the defendants’ and relief defendants’ assets. The defendants and relief defendants agreed to preliminary injunctions, which the court entered on September 18, 2014. The preliminary injunctions continue the conduct prohibitions and asset freezes set forth in the temporary restraining order.

HHS SAYS MORE PHYSICIANS, HOSPITALS USING ELECTRONIC HEALTH RECORDS (EHRs)

FROM:  U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES 

More physicians and hospitals are using EHRs than before

CDC data provides baseline for EHR adoption among health care providers

Significant increases in the use of electronic health records (EHRs) among the nation’s physicians and hospitals are detailed in two new studies published today by the HHS Office of the National Coordinator for Health Information Technology (ONC).

The studies, published in the journal Health Affairs, found that in 2013, almost eight in ten (78 percent) office-based physicians reported they adopted some type of EHR system. About half of all physicians (48 percent) had an EHR system with advanced functionalities in 2013, a doubling of the adoption rate in 2009.

About 6 in 10 (59 percent) hospitals had adopted an EHR system with certain advanced functionalities in 2013, quadruple the percentage for 2010. Unlike the physician study, the hospital study does not have an equivalent, established measure of adoption of some type of EHR system; it only reports on adoption of EHRs with advanced functionalities.

“Patients are seeing the benefits of health IT as a result of the significant strides that have been made in the adoption and meaningful use of electronic health records,” said Karen DeSalvo, M.D., M.P.H., national coordinator for health information technology. “We look forward to working with our partners to ensure that people’s digital health information follows them across the care continuum so it will be there when it matters most.”

The information in the studies was collected by the Centers for Disease Control and Prevention’s National Center for Health Statistics and the American Hospital Association in 2013.

These data provide an early baseline understanding of provider readiness to achieve Stage 2 Meaningful Use of the Medicare and Medicaid EHR Incentive programs.  Stage 2 will begin later this year for providers who first attested to Stage 1 Meaningful Use in 2011 or 2012. About 75 percent of eligible professionals and more than 91 percent of hospitals have adopted or demonstrated Stage 1 Meaningful Use of certified EHRs.

The studies also show that more work is needed to support widespread health information exchange and providers’ ability to achieve Stage 2 Meaningful Use requirements under the Medicare and Medicaid EHR Incentive Programs. Among the details include the following:

In 2013, health information exchange among physicians was relatively low: 4 in 10 (39 percent) reported they electronically share data with other providers, but only 14 percent electronically share data with ambulatory care providers or hospitals outside their organization.
In 2013, the vast majority of hospitals had capabilities that could be used to support many Meaningful Use Stage 2 objectives but were not being used. However, 10 percent of hospitals were providing patients with online access to view, download, and transmit information about their hospital admission.
Throughout 2014, HHS has prioritized its efforts to support providers in achieving Meaningful Use Stage 2 and work toward an interoperable health system that enables nationwide health information exchange. These include:

On-the-ground support from many of the 62 ONC-funded regional extension centers to more than 150,000 providers that serve all types of patients, including Medicare, Medicaid, private pay, and uninsured, helping them use their EHRs to meet the Stage 2 measures such as those for clinical quality improvement, transitions of care, care coordination, and the privacy and security requirements;
Sharing tools and resources to support providers in engaging their patients in their health and health care using health IT tools, and to help meet the “view, download, and transmit measure” needed to achieve Meaningful Use Stage 2; and
Webinars, user guides, tip sheets, listserv subscriptions and other educational resources provided by the CMS eHealth University and available on the CMS website.

HOSPITAL SYSTEM, PHYSICIAN GROUP SETTLE FALSE CLAIMS LAWSUIT FOR $24.5 MILLION

FROM:  U.S. JUSTICE DEPARTMENT 

Monday, July 21, 2014

Alabama Hospital System and Physician Group Agree to Pay $24.5 Million to Settle Lawsuit Alleging False Claims for Illegal Medicare Referrals

Mobile, Alabama-based Infirmary Health System Inc. (IHS), two IHS-affiliated clinics and Diagnostic Physicians Group P.C. (DPG) have agreed to pay the United States $24.5 million to resolve a lawsuit alleging that they violated the False Claims Act by paying or receiving financial inducements in connection with claims to the Medicare program, the Justice Department announced today.

“Financial arrangements that compensate physicians for referrals encourage physicians to make decisions based on financial gain rather than patients’ needs,” said Assistant Attorney General for the Civil Division Stuart F. Delery.  “The Department of Justice is committed to preventing illegal financial relationships that undermine the integrity of our public health programs.”

The government’s suit alleged that two IHS affiliated clinics -- IMC-Diagnostic and Medical Clinic, in Mobile, and IMC-Northside Clinic, in Saraland, Alabama -- had agreements with DPG to pay the group a percentage of Medicare payments for tests and procedures referred by DPG physicians, in violation of the Physician Self-Referral Law (commonly known as the Stark Law) and the Anti-Kickback Statute.  Also named in the lawsuit was Infirmary Medical Clinics P.C. (IMC), an affiliate of IHS that directly owns and operates approximately 30 clinics in the Mobile area, including the two clinics involved in this lawsuit.

The Anti-Kickback Statute and the Stark Law are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives.  The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by federal health care programs, including Medicare.  The Stark Law forbids a hospital or clinic from billing Medicare for certain services referred by physicians who have a financial relationship with the entity.

According to the government’s complaint, in 1988, IMC purchased IMC-Diagnostic and Medical Clinic from DPG and agreed to pay DPG a share of the revenues the clinics collected, including Medicare revenues from diagnostic imaging and laboratory tests.  After IMC acquired the IMC-Northside Clinic in 2008, the physicians practicing there joined DPG and entered into an agreement with the same key terms as the earlier agreement with IMC-Diagnostic and Medical Clinic.  The government contended that these payments were illegal kickbacks and constituted a prohibited financial relationship under the Stark Law, and that in June 2010, an attorney for DPG warned employees of both IMC and DPG that the compensation being paid to the physicians likely violated the law.  Nevertheless, the agreements allegedly were neither modified nor terminated for another 18 months.

The lawsuit was originally filed by Dr. Christian Heesch, a physician formerly employed by DPG, under the whistleblower provisions of the False Claims Act.  Those provisions authorize private parties to sue on behalf of the United States and to receive a portion of any recovery.  The act permits the United States to intervene and take over the lawsuit, as it did in this case with respect to some of Dr. Heesch’s allegations.  Dr. Heesch will receive $4.41 million as his share of the settlement.

“Today’s settlement represents a single but significant step towards achieving integrity in the administration of public health programs in this region,” said U.S. Attorney Kenyen Brown for the Southern District of Alabama.  “Physicians, physician groups and other medical entities operating illegally within public health programs will be held accountable.  I also commend whistle blowers like Dr. Christian Heesch, who helped bring this particular case to light.”

As part of the settlement announced today, the settling defendants have also agreed to enter into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), which obligates the defendants to undertake substantial internal compliance reforms and to submit its federal health care program claims to independent review for the next five years.

“Patients must know that medical advice is based on best practices, not on their provider’s bottom line,” said HHS-OIG Special Agent in Charge Derrick L. Jackson.  “We are pleased these allegations are resolved and will continue to work with the U.S. Department of Justice to investigate and pursue illegal, wasteful business arrangements.”

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $20.2 billion through False Claims Act cases, with more than $14 billion of that amount recovered in cases involving fraud against federal health care programs.

The investigation and litigation were conducted by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Southern District of Alabama, HHS-OIG and the FBI.  The claims settled by this agreement are allegations only, and there has been no determination of liability.

The case is captioned U.S. ex rel. Heesch v. Diagnostic Physicians Group, P.C. et al., Civil Action No. 11-0364-KD-B (S.D. Ala.).

FOUR GUILTY PLEAS FOR PATIENT RECRUITERS ENGAGED IN HEALTHCARE FRAUD

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, July 10, 2014

Four Patient Recruiters Plead Guilty in Miami for Roles in $20 Million Health Care Fraud Scheme

Four patient recruiters pleaded guilty in connection with a $20 million health care fraud scheme involving Trust Care Health Services Inc. (Trust Care), a defunct home health care company.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Acting Special Agent in Charge Ryan Lynch of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office made the announcement.

At a hearing today before U.S. District Judge Darrin P. Gayles of the Southern District of Florida, Estrella Perez, 57, and Solchys Perez, 34, both pleaded guilty to conspiracy to commit health care fraud, and Abigail Aguila, 40, pleaded guilty to conspiracy to defraud the United States and receive health care kickbacks.   Sentencing for all three defendants is set for Sept. 18, 2014 in front of Judge Gayles.   On June 17, 2014, another co-defendant, Monica Macias, 52, pleaded guilty to conspiracy to defraud the United States and receive health care kickbacks before U.S. Magistrate Judge Chris M. McAliley of the Southern District of Florida.  Sentencing for Macias is set for Sept. 10, 2014 before Judge Gayles.

According to court documents, the defendants worked as patient recruiters for the owners and operators of Trust Care, a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries.   Trust Care was operated for the purpose of billing the Medicare Program for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or were not provided.

The defendants recruited patients for Trust Care and solicited and received kickbacks and bribes from the owners and operators of Trust Care in return for allowing the agency to bill the Medicare program on behalf of the recruited Medicare patients.   These Medicare beneficiaries were billed for home health care and therapy services that were not medically necessary and/or were not provided.

Estrella Perez and Solchys Perez also paid kickbacks and bribes to co-conspirators in doctors’ offices and clinics in exchange for providing home health and therapy prescriptions, plans of care, and medical certifications for their recruited patients.   Co-conspirators at Trust Care then used these prescriptions, plans of care and medical certifications to fraudulently bill the Medicare program for home health care services.

From approximately March 2007 through at least January 2010, Trust Care submitted more than $20 million in claims for home health services.   Medicare paid Trust Care more than $15 million for these fraudulent claims.

The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.   This case is being prosecuted by Trial Attorneys A. Brendan Stewart and Anne P. McNamara of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

LARGEST U.S. NURSING HOME PHARMACY COMPANY SETTLES FALSE BILLINGS ALLEGATIONS FOR $124 MILLION

FROM:  U.S. JUSTICE DEPARTMENT 

Wednesday, June 25, 2014

Nation’s Largest Nursing Home Pharmacy Company to Pay $124 Million to Settle Allegations Involving False Billings to Federal Health Care Programs

Omnicare Inc., the nation’s largest provider of pharmaceuticals and pharmacy services to nursing homes, has agreed to pay $124.24 million for allegedly offering improper financial incentives to skilled nursing facilities in return for their continued selection of Omnicare to supply drugs to elderly Medicare and Medicaid beneficiaries, the Justice Department announced today .   Omnicare is headquartered in Cincinnati, Ohio.


“Health care providers who seek to profit from providing illegal financial benefits will be held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “Schemes such as this one undermine the health care system and take advantage of elderly nursing home residents.”

“Omnicare provided improper discounts in return for the opportunity to provide medication to Medicare and Medicaid beneficiaries,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “Nursing homes should select their pharmacy provider based on the best quality, service and cost to the residents, not based on improper discounts to the nursing facility.”

The settlement resolves allegations that Omnicare submitted false claims by entering into below-cost contracts to supply prescription medication and other pharmaceutical drugs to skilled nursing facilities and their resident patients to induce the facilities to select Omnicare as their pharmacy provider.  The facilities were participating providers under agreements with Medicare and Medicaid.   In addition to the facilities’ own claims for reimbursement from Medicare for short-term rehabilitation treatment rendered to patients, Omnicare submitted additional claims for reimbursement to Medicare and Medicaid for drugs Omnicare supplied.   Of the $124.24 million to be paid by Omnicare, $8.24 million will go to various states which jointly funded the Medicaid programs impacted by Omnicare’s conduct.

The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded programs.  The Anti-Kickback Statute is intended to ensure that the selection of health care providers and suppliers is not compromised by improper financial incentives and is instead based on the best interests of the patient.

The settlement resolves allegations brought in two lawsuits filed by whistleblowers under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and to share in any recovery.  The first whistleblower, Donald Gale, a former Omnicare employee, will receive $ 17.24 million.

The settlement with Omnicare was the result of a coordinated effort by the U.S. Attorney’s Office for the Northern District of Ohio, the Commercial Litigation Branch of the Justice Department’s Civil Division, the Department of Health and Human Services Office of Inspector General, and the National Association of Medicaid Fraud Control Units.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $19.5 billion through False Claims Act cases, with more than $13.9 billion of that amount recovered in cases involving fraud against federal health care programs.

The claims resolved by this settlement are allegations only, and there has been no determination of liability.

HHS HAS NEW DATA, TOOLS TO INCREASE HOSPITAL UTILIZATION TRANSPARENCY

FROM:  U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES 

HHS releases new data and tools to increase transparency on hospital utilization and other trends

Data can help improve care coordination and health outcomes for Medicare beneficiaries

With more than 2,000 entrepreneurs, investors, data scientists, researchers, policy experts, government employees and more in attendance, the Department of Health and Human Services (HHS) is releasing new data and launching new initiatives at the annual Health Datapalooza conference in Washington, D.C.

Today, the Centers for Medicare & Medicaid Services (CMS) is releasing its first annual update to the Medicare hospital charge data, or information comparing the average amount a hospital bills for services that may be provided in connection with a similar inpatient stay or outpatient visit. CMS is also releasing a suite of other data products and tools aimed to increase transparency about Medicare payments. The data trove on CMS’s website now includes inpatient and outpatient hospital charge data for 2012, and new interactive dashboards for the CMS Chronic Conditions Data Warehouse and geographic variation data. Also today, the Food and Drug Administration (FDA) will launch a new open data initiative. And before the end of the conference, the Office of the National Coordinator for Health Information Technology (ONC) will announce the winners of two data challenges.

“The release of these data sets furthers the administration’s efforts to increase transparency and support data-driven decision making which is essential for health care transformation,” said HHS Secretary Kathleen Sebelius.

“These public data resources provide a better understanding of Medicare utilization, the burden of chronic conditions among beneficiaries and the implications for our health care system and how this varies by where beneficiaries are located,” said Bryan Sivak, HHS chief technology officer. “This information can be used to improve care coordination and health outcomes for Medicare beneficiaries nationwide, and we are looking forward to seeing what the community will do with these releases. Additionally, the openFDA initiative being launched today will for the first time enable a new generation of consumer facing and research applications to embed relevant and timely data in machine-readable, API-based formats."

2012 Inpatient and Outpatient Hospital Charge Data

The data posted today on the CMS website provide the first annual update of the hospital inpatient and outpatient data released by the agency last spring. The data include information comparing the average charges for services that may be provided in connection with the 100 most common Medicare inpatient stays at over 3,000 hospitals in all 50 states and Washington, D.C. Hospitals determine what they will charge for items and services provided to patients and these “charges” are the amount the hospital generally bills for those items or services.

With two years of data now available, researchers can begin to look at trends in hospital charges. For example, average charges for medical back problems increased nine percent from $23,000 to $25,000, but the total number of discharges decreased by nearly 7,000 from 2011 to 2012.

In April, ONC launched a challenge – the Code-a-Palooza challenge – calling on developers to create tools that will help patients use the Medicare data to make health care choices. Fifty-six innovators submitted proposals and 10 finalists are presenting their applications during Datapalooza. The winning products will be announced before the end of the conference.

Chronic Conditions Warehouse and Dashboard

CMS recently released new and updated information on chronic conditions among Medicare fee-for-service beneficiaries, including:

Geographic data summarized to national, state, county, and hospital referral regions levels for the years 2008-2012;

Data for examining disparities among specific Medicare populations, such as beneficiaries with disabilities, dual-eligible beneficiaries, and race/ethnic groups;
Data on prevalence, utilization of select Medicare services, and Medicare spending;

Interactive dashboards that provide customizable information about Medicare beneficiaries with chronic conditions at state, county, and hospital referral regions levels for 2012; and Chartbooks and maps.

These public data resources support the HHS Initiative on Multiple Chronic Conditions by providing researchers and policymakers a better understanding of the burden of chronic conditions among beneficiaries and the implications for our health care system.

Geographic Variation Dashboard

The Geographic Variation Dashboards present Medicare fee-for-service per-capita spending at the state and county levels in interactive formats. CMS calculated the spending figures in these dashboards using standardized dollars that remove the effects of the geographic adjustments that Medicare makes for many of its payment rates. The dashboards include total standardized per capita spending, as well as standardized per capita spending by type of service. Users can select the indicator and year they want to display. Users can also compare data for a given state or county to the national average. All of the information presented in the dashboards is also available for download from the Geographic Variation Public Use File.

Research Cohort Estimate Tool

CMS also released a new tool that will help researchers and other stakeholders estimate the number of Medicare beneficiaries with certain demographic profiles or health conditions. This tool can assist a variety of stakeholders interested in specific figures on Medicare enrollment. Researchers can also use this tool to estimate the size of their proposed research cohort and the cost of requesting CMS data to support their study.

Digital Privacy Notice Challenge

ONC, with the HHS Office of Civil Rights, will be awarding the winner of the Digital Privacy Notice Challenge during the conference. The winning products will help consumers get notices of privacy practices from their health care providers or health plans directly in their personal health records or from their providers’ patient portals.

OpenFDA

The FDA’s new initiative, openFDA, is designed to facilitate easier access to large, important public health datasets collected by the agency. OpenFDA will make FDA’s publicly available data accessible in a structured, computer readable format that will make it possible for technology specialists, such as mobile application creators, web developers, data visualization artists and researchers to quickly search, query, or pull massive amounts of information on an as needed basis. The initiative is the result of extensive research to identify FDA’s publicly available datasets that are often in demand, but traditionally difficult to use. Based on this research, openFDA is beginning with a pilot program involving millions of reports of drug adverse events and medication errors submitted to the FDA from 2004 to 2013. The pilot will later be expanded to include the FDA’s databases on product recalls and product labeling.

HHS SECRETARY ANNOUNCES DELIVERY SYSTEM REFORM FOR HEALTH CARE

FROM:  U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES 

New funding gives states and innovators tools and flexibility to implement delivery system reform

Health and Human Services Secretary Kathleen Sebelius today announced new delivery system reform efforts made possible by the Affordable Care Act that offer states and innovators tools and flexibility to transform health care. 

HHS announced twelve prospective recipients receiving as much as $110 million in combined funding, ranging from an expected $2 million to $18 million over a three-year period, under the Health Innovation Awards program to test innovative models designed to deliver better care outcomes and lower costs.  Examples include projects to provide better care for dementia patients, improve coordination between specialists and primary care physicians, and to improve cardiac care. Round two of the Health Care Innovation Awards program focuses on four priority areas: rapidly reducing costs for patients with Medicare and Medicaid; improving care for populations with specialized needs; testing improved financial and clinical models for specific types of providers, including specialists; and linking clinical care delivery to preventive and population health.  The twelve prospective recipients will test models in all four categories and spanning 13 states.  Additional prospective recipients will be announced in the coming months.

Also today, HHS made up to $730 million available as part of the State Innovation Model initiative to help states design and test improvements to their public and private health care payment and delivery systems.  Project goals are to improve health, improve care, and decrease costs for consumers, including Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) beneficiaries.

“As a former governor, I understand the real sense of urgency states and local communities feel to improve the health of their populations while also reducing health care costs, and it’s critical that the many elements of health care in each state – including Medicaid, public health, and workforce training – work together,” Secretary Sebelius said.  “To help, HHS will continue to encourage and assist them in their efforts to transform health care.

“These efforts will strengthen federal, state, and local partnerships, encourage broad stakeholder engagement, and capitalize on federal resources to ensure greater transformation of delivery of health care services,” said Centers for Medicare & Medicaid Services (CMS) Administrator Marilyn Tavenner.

The twelve innovative projects announced today represent the first batch of prospective recipients for round two of Health Care Innovation Awards program funding.  In 2012, 107 organizations located in urban and rural areas, all 50 states, the District of Columbia and Puerto Rico received awards through round one of the initiative.  

As part of the State Innovation Model initiative, states, territories and the District of Columbia can apply for either a Model Test award to assist in implementation or a Model Design award to develop or enhance a comprehensive State Health Care Innovation Plan.   Up to 12 states will be chosen for state-sponsored Model Testing awards ($700 million available) and up to 15 states will be chosen for state-sponsored Model Design work ($30 million available).

Examples of ongoing state-led health care innovations include development of advanced primary care networks supported by statewide health information technology systems and models that coordinate care seamlessly across providers.  The second round of the State Innovation Models will continue to support and advance this good work.

TWO ORTHOPEDIC CLINICS TO PAY $1.85 MILLION TO SETTLE FALSE CLAIMS ACT ALLEGATIONS

FROM:  JUSTICE DEPARTMENT 
Friday, January 24, 2014
Tennessee and Virginia Orthopedic Clinics to Pay $1.85 Million to Settle Allegations of Billing Medicare for Reimported Products

Two orthopedic clinics will pay a combined $1.85 million to resolve state and federal False Claims Act allegations that they knowingly billed state and federal health care programs for reimported osteoarthritis medications, known as viscosupplements, the Department of Justice announced today.  Tennessee Orthopaedic Clinics P.C., headquartered in Knoxville, Tenn., will pay $1.3 million, and Appalachian Orthopaedic Clinics P.C., headquartered in Kingsport, Tenn., will pay $550,000.

“The Department of Justice will not tolerate the conduct of companies that impermissibly shift risks onto patients in order to increase their own profits,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “The department is committed to maintaining the integrity of the health care system, ensuring that patients receive drugs and devices that are safe and effective and taking action against companies that take chances with the health of consumers so as to improve their own bottom lines.”

Viscosupplements, such as Synvisc and Orthovisc, are injections approved by the Food and Drug Administration for the treatment of osteoarthritis pain in the knee.  Viscosupplements are reimbursed by Medicare, Medicaid and other federal health care programs at a set rate based on the average sales price of the domestic product.  The government contended that the clinics knowingly purchased deeply discounted viscosupplements that were reimported from foreign countries and billed them to state and federal health care programs in order to profit from the reimbursement system, when such reimported viscosupplements were not reimbursable by those programs.  Allegedly, the reimported product included labeling in foreign languages and in English for additional uses not approved in the United States, which demonstrated that the product was reimported.  Moreover, because the product was reimported, the government alleged there was no manufacturer assurance that it had not been tampered with or that it was stored appropriately.  

“This scheme is yet another example of illegal actions by health care providers to profit from drugs imported into the United States,” said U.S. Attorney for the Eastern District of Tennessee William C. Killian.  “Medicare and FDA requirements are designed to prevent potential harm to patients.  Noncompliance with the law to increase profit at the risk of patients will be pursued by the Department of Justice.”
         
“Attempts to increase profits by circumventing the law will not be tolerated,” said Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General in Atlanta Derrick L. Jackson.  “Health care providers buying cut-rate, cheap drugs from foreign sources will end up paying a steep price.”

The allegations resolved by the settlement were first raised in a lawsuit filed against the clinics under the qui tam, or whistleblower, provisions of the False Claims Act by Douglas Estey, a physician’s assistant who was occasionally paid by Genzyme Corp. to speak to medical providers about the use of Synvisc.  The Act allows private citizens with knowledge of fraud to bring civil actions on behalf of the government and to share in any recovery.  Estey will receive $323,750.

The government’s investigation was a coordinated effort by the Civil Division of the Department of Justice, the U.S. Attorney’s Office for the Eastern District of Tennessee, the Department of Health and Human Services Office of Inspector General and Office of General Counsel, the Food and Drug Administration Office of Criminal Investigations and Office of Chief Counsel, the Federal Bureau of Investigation and the Tennessee Bureau of Investigation.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $17.1 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.

The case is captioned United States ex rel. Estey v. Tennessee Orthopaedic Clinics P.C., Appalachian Orthopaedic Associates P.C. and Appalachian Orthopaedic Partners LLC, Docket No. 3:12-cv-85 Varlan/Guyton.  The claims settled by these agreements are allegations only; there have been no determinations of liability.  

HHS WORKS ON LIVING OPTIONS FOR OLDER PEOPLE WITH DISABILITIES

FROM:  HEALTH AND HUMAN SERVICES 
HHS strengthens community living options for older Americans and people with disabilities

The Centers for Medicare & Medicaid Services (CMS) issued a final rule today to ensure that Medicaid’s home and community-based services programs provide full access to the benefits of community living and offer services in the most integrated settings. The rule, as part of the Affordable Care Act, supports the Department of Health and Human Services’ Community Living Initiative. The initiative was launched in 2009 to develop and implement innovative strategies to increase opportunities for Americans with disabilities and older adults to enjoy meaningful community living.

Under the final rule, Medicaid programs will support home and community-based settings that serve as an alternative to institutional care and that take into account the quality of individuals’ experiences.  The final rule includes a transitional period for states to ensure that their programs meet the home and community-based services settings requirements.  Technical assistance will also be available for states.

 “People with disabilities and older adults have a right to live, work, and participate in the greater community.  HHS, through its Community Living Initiative, has been expanding and improving the community services necessary to make this a reality,” said HHS Secretary Kathleen Sebelius. “Today’s announcement will help ensure that all people participating in Medicaid home and community-based services programs have full access to the benefits of community living.”

In addition to defining home and community-based settings, the final rule implements the Section 1915(i) home and community-based services State Plan option. This includes new flexibility provided by the Affordable Care Act that gives states additional options for expanding home and community-based services and to target services to specific populations.  It also amends the 1915(c) home and community-based services waiver program to add new person-centered planning requirements, allow states to combine multiple target populations in one waiver, and streamlines waiver administration.

HEALTH CARE COMPANY EXECS TO PAY OVER $1 MILLION TO RESOLVE FALSE CLAIMS ALLEGATIONS

FROM:  JUSTICE DEPARTMENT 
Friday, January 10, 2014
Former HealthEssentials Solutions Inc. Executives to Pay More Than $1 Million to Resolve Allegations of Submitting False Claims to Federal Health Care Program

Michael R. Barr, former chief executive officer of Louisville, Kentucky-based HealthEssentials Solutions Inc., has agreed to pay $1 million to resolve allegations that he knowingly caused HealthEssentials to submit false claims to Medicare between 1999 and 2004, the Justice Department announced today.  Norman J. Pfaadt, HealthEssentials’ former chief financial officer, also agreed to pay $20,000 to resolve similar allegations.  H ea lt h E s s e nt i a ls provided primary medical care to patients in nursing facilities, assisted living facilities and other settings from 1998 until it filed for bankruptcy and ceased operations in 2005.  Barr founded HealthEssentials and served as its president, chief executive and board chairman.  Pfaadt served as HealthEssentials’ senior vice president and chief financial officer.

“Healthcare executives should lead by example and create cultures of compliance within their companies, not pressure their employees to cheat the taxpayers,” said Assistant Attorney General for the Civil Division Stuart F. Delery.  “We will continue to hold health care executives personally accountable for their dealings with Medicare.”

“Pursuing health care fraud is a priority of this office and the Department of Justice,” said U.S. Attorney for the Western District of Kentucky David J. Hale.  “We will continue to work with the Department of Health and Human Services and the public to ensure that fraudulent claims are investigated and those responsible are required to pay.”
         
In March 2008, HealthEssentials pleaded guilty to submitting false statements to Medicare relating to services it provided to patients in assisted living facilities and entered into a civil settlement with the government.  In May 2011, HealthEssentials’ former director of billing, Karen Stone, pleaded guilty for her role in the company’s billing scheme.

The settlement announced today resolves Barr’s and Pfaadt’s alleged liability under the False Claims Act for their roles in HealthEssentials’ false billings.  The government alleged that, between 1999 and 2004, HealthEssentials billed for services that were inflated or not medically necessary and that Barr and Pfaadt pressured HealthEssentials employees to inflate the company’s billings, despite having been advised by attorneys and others that doing so would be improper.  The government further alleged that Barr pressured HealthEssentials employees to conduct special medical assessments on patients, without regard to whether the patients required the assessments, solely to increase the amount that HealthEssentials could bill for the visits.  As part of the settlement, Barr has agreed to a three-year period of exclusion from participating in federally funded health care programs.

“Executives cheating taxpayers and patients – as alleged in this case – should beware of exclusion from Medicare, Medicaid and all other federal health programs, as well as criminal and civil liability,” said Inspector General of the U.S. Department of Health and Human Services Daniel R. Levinson.  “Vulnerable beneficiaries deserve protection from potentially harmful, medically unnecessary services.”

The allegations that were resolved by the settlement arose in part from a lawsuit filed by former HealthEssentials employees Michael and Leigh RoBards under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring suit on behalf of the government and to share in any recovery.  Mr. and Mrs. RoBards will receive a total of $153,000.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.

The case was handled by the Commercial Litigation Branch, Civil Division, U.S. Department of Justice and the U.S. Attorney’s Office for the Western District of Kentucky, with assistance from the Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation.

The claims settled by this agreement are allegations only; there has been no determination of liability.  The case is captioned United States ex rel. Stydinger, et al. v. Michael R. Barr and Norman J. Pfaadt, Civil No. 3:03-cv-00380-TBR (W.D. Ky.).

FLORIDA VEIN CLINIC AGREES TO PAY $400,000 TO RESOLVE FALSE CLAIMS ACT ALLEGATIONS

FROM:  U.S. JUSTICE DEPARTMENT

FOR IMMEDIATE RELEASE
Tuesday, January 7, 2014
United States Government Settles False Claims Act Allegations Against Florida Vein Clinic and Its Owner

A Florida-based physician, Dr. Ravi Sharma, has agreed to pay $400,000 to resolve allegations that he and his clinics violated the False Claims Act by knowingly billing Medicare for vein injections and physician office visits performed by unqualified personnel, the Justice Department announced today.

“Vein injections and other invasive procedures should be performed by appropriately qualified personnel,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.   “We will not tolerate those who put patients’ health at risk for their personal gain and convenience.”  

The government alleged that, between 2009 and 2010, Sharma owned and operated a clinic in the Tampa area called Premier Vein Centers.   Beginning in 2009, Sharma allegedly sent text messages to his office manager instructing her to perform varicose vein injections on patients when he was not in the office.   The government further alleged that, when Sharma was in the office, he performed unnecessary vein injections and unnecessary ultrasound imaging procedures associated with those vein injections.

Sharma also owned and operated, between 2009 and 2010, a weight loss clinic in the Tampa area called Life’s New Image.   Allegedly, unqualified personnel met with patients of the clinic, but Sharma billed those visits as physician office visits using his own Medicare provider number.   Sharma closed Premier Vein Centers and Life’s New Image in 2010.

“We are pleased to announce this very favorable resolution of our claims against this provider,” said Acting U.S. Attorney for the Middle District of Florida A. Lee Bentley III.   “Again, it demonstrates our commitment to civil health care fraud enforcement in our district.”

The allegations covered by the settlement were originally raised in a lawsuit filed by Patti Lovell, the former office manager for Sharma, under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for the submission of false claims and to receive a share of any recovery.   Lovell will receive $72,000.

As part of the settlement, Sharma entered into a three-year Integrity Agreement with the Office of Inspector General of the Department of Health and Human Services.   The agreement requires Sharma to attend training courses provided by the Centers for Medicare and Medicaid Services and provides for an independent external review of his federal health care program coding and billing procedures.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.

The investigation of this matter reflects a coordinated effort among the Commercial Litigation Branch of the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Middle District of Florida and the Department of Health and Human Services Office of Inspector General.

The lawsuit is captioned U.S. ex rel. Lovell v. Ravi Sharma, M.D. and Premier Vein Centers, 12-CV-133 (M.D. Fla.).   The claims resolved by the settlement are allegations only, and there has been no determination of liability.

HHS SAYS 123 ACCOUNTABLE CARE ORGANIZATIONS SHOULD IMPROVE MEDICARE

FROM:  U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES 
More partnerships between doctors and hospitals strengthen coordinated care for Medicare beneficiaries
123 New Accountable Care Organizations Join Program to Improve Care for  Medicare beneficiaries

Doctors, hospitals and other health care providers have formed 123 new Accountable Care Organizations (ACOs) in Medicare, providing approximately 1.5 million more Medicare beneficiaries with access to high-quality coordinated care across the United States, Health and Human Services Secretary Kathleen Sebelius announced today.

Doctors, hospitals and health care providers establish ACOs in order to work together to provide higher-quality coordinated care to their patients, while helping to slow health care cost growth. Since passage of the Affordable Care Act, more than 360 ACOs have been established, serving over 5.3 million Americans with Medicare.  Beneficiaries seeing health care providers in ACOs always have the freedom to choose doctors inside or outside of the ACO. ACOs share with Medicare any savings generated from lowering the growth in health care costs when they meet standards for high quality care.

“Accountable Care Organizations are delivering higher-quality care to Medicare beneficiaries and are using Medicare dollars more efficiently,” Secretary Sebelius said.   “This is a great example of the Affordable Care Act rewarding hospitals and doctors that work together to help our beneficiaries get the best possible care.”

“This program puts the control in the hands of physicians and allows them to take the lead in an innovative way to deliver the right care to the right patient at the right time,” said Kelly A. Conroy, executive director of the Palm Beach ACO and South Florida ACO.  “We are honored to be a Medicare Shared Savings Program Accountable Care Organization, and after 18 months in the program, can proudly say that we have seen measurable success.  We are so impressed with our participating physicians’ enthusiasm towards the cultural shift, and it demonstrates that physicians are primed for the future of medicine.”

The ACOs must meet quality standards to ensure that savings are achieved through improving care coordination and providing care that is appropriate, safe, and timely. The Centers for Medicare & Medicaid Services (CMS) evaluates ACO quality performance using 33 quality measures on patient and caregiver experience of care, care coordination and patient safety, appropriate use of preventive health services, and improved care for at-risk populations.

The new ACOs include a diverse cross-section of health care providers across the country, including providers delivering care in underserved areas. More than half of ACOs are physician-led organizations that serve fewer than 10,000 beneficiaries. Approximately 1 in 5 ACOs include community health centers, rural health clinics, and critical access hospitals that serve low-income and rural communities.

Affordable Care Act provisions have a substantial effect on reducing the growth rate of Medicare spending.  Growth in Medicare spending per beneficiary hit historic lows during the 2010-2012 period, and this trend has continued into 2013. Projections by both the Office of the Actuary at CMS and the Congressional Budget Office estimate that Medicare spending per beneficiary will grow at approximately the rate of growth of the economy for the next decade, breaking a decades-old pattern of spending growth outstripping economic growth.

The next application period for organizations interested in participating in the Shared Savings Program beginning January 2015 will be in summer 2014.