DOJ recently announced a massive coordinated effort with other federal agencies to charge 345 defendants allegedly responsible for over $6 billion in fraud. DOJ, OIG, FBI, DEA, and various US Attorneys’ Offices in 51 federal districts teamed up to unveil charges against more than 100 doctors, nurses, and licensed clinical personnel. In its September 30 press release, DOJ asserts that the largest portion of the $6 billion in losses – 75% – is attributable to what it describes as “Telemedicine Fraud Cases.” At first blush, this is a headline-grabbing figure that suggests that the nascent Medicare telehealth industry is rife with fraudulent conduct. But, in peeling back the layers, are DOJ’s concerns really about telehealth or historic issues in healthcare and other industries?
First, let’s look at what DOJ alleged. In a nutshell, DOJ asserts that telemedicine executives paid doctors and nurse practitioners to order unnecessary DME, genetic tests, and pain medications, either with no interaction or with only a “brief” telephone encounter with patients the clinicians had never seen before. In turn, DME companies, genetic testing labs, and pharmacies purchased these orders “in exchange for illegal kickbacks and bribes,” ultimately submitting the claims to Medicare and other government payers. What DOJ’s press release does not make clear is what specific laws are alleged to have been broken, as both general “health care fraud” for unnecessary services and Anti-Kickback Statute violations appear to be at play.
Nevertheless, DOJ neither raises concerns that are specific to the telehealth industry nor appears to take issue with the actual provision of telehealth services to patients. Instead, the focus here is clearly on the unwarranted supplies, orthotics, and testing that were ultimately furnished and billed to Medicare by certain suppliers and labs. Although telehealth served as a conduit to get orders to these companies in this instance, the allegations could just as easily have involved unscrupulous practitioners at a local clinic who were signing orders for patients they had never treated. In other words, telehealth as a practice modality does not seem to have caused the alleged fraud at issue. Still, it is important for both practitioners and telehealth companies to understand DOJ’s perspective in this takedown and the rhetoric used when describing the role of telehealth in this scheme.
A critical, but potentially overlooked, aspect of DOJ’s recent announcement is its reference to coordinated administrative action by the CMS Center for Program Integrity. CPI revoked the Medicare billing numbers for 256 medical professionals as a result of their alleged involvement in the “telemedicine schemes.” CPI, in conjunction with its program integrity contractors, has been liberally using its suspension and revocation authorities over the past two years, despite CMS’s calls for easing provider burden and reducing regulatory barriers to care. Despite the significant impact of revocations and suspensions on affected providers, these sanctions are often imposed with little more than cursory investigation into the conduct of the healthcare professionals. For example, if a physician was affiliated with or providing services through one of the telehealth companies involved in this latest DOJ takedown, even for a short period of time and without knowledge of the downstream relationships involved, it is possible that CPI took coordinated administrative action against that individual. Even if a clinician does not have bad intent, a clinician’s failure to diligence those with whom the physician is working and to understand the role he or she plays in the arrangement will not absolve the clinician of potential sanctions in the Medicare program.
Rather than establishing novel theories of liability, what this $6 billion DOJ telehealth takedown seems to emphasize is that, if you are a telehealth operator, practitioner, or health system working in this space, you must remain mindful, as always, of state licensure laws, federal and state antifraud laws, and federal, state, and private payor coverage and billing requirements for telehealth.