Arent Fox

The US Attorney’s Office for the Middle District of Florida, in collaboration with the US Attorney’s Office for the Eastern District of Tennessee, announced a $2.5 million settlement with several entities operating a telemarketing business.

The government alleged that the companies engaged in a scheme where the companies fraudulently obtained insurance coverage information from consumers and arranged for them to receive prescription pain creams and similar products that were medically unnecessary and outside of a valid doctor-patient relationship. The government further alleged that the companies sold those prescriptions to pharmacies under the guise of marketing services, and that the payments solicited from the pharmacies were kickbacks.

“Prescriptions and other medical services resulting from kickbacks undermine the integrity of our health care system,” said US Attorney J. Douglas Overbey for the Eastern District of Tennessee. “Telemedicine is a valuable service for our citizens, but it must not be abused. We will take action against individuals who break the law to make a profit at the expense of our federal healthcare programs and ultimately at the expense of the American taxpayer.”

The DOJ press release can be found here.

DC Physician Allegedly Perpetrated $12.7 Million Health Care Fraud Scheme

The DOJ announced the unsealing of an indictment against a District of Columbia physician for his role in an alleged $12.7 million health care fraud scheme. The indictment sets forth 11 counts of health care fraud, alleging that from January 2015 through August 2018, the physician submitted Medicare claims for injections and aspirations that were medically unnecessary and/or never provided. The indictment also alleges that the physician falsified medical documents to cover up the scheme.

The DOJ press release can be found here.

Litigation Developments

Texas Judge Throws Out $61.8 Million FCA Lawsuit

A Texas federal judge dismissed with prejudice a qui tam False Claims Act lawsuit brought against Baylor Scott & White Health. Relator Integra Med Analytics LLC alleged that the hospital company engaged in a scheme to intentionally overbill Medicare using certain diagnosis codes and that management created a culture that encouraged inflated billing.

US District Judge David A. Ezra held that the complaint contained only “naked assertions” of wrongdoing, and failed to allege facts to support that the hospital company “requested, demanded, or encouraged doctors and staff to diagnose in a way that was not justified by the physicians own medical opinions, judgments, and the medical record.” The government declined to intervene in the suit.

The case is U.S. ex rel. Integra Med Analytics LLC v. Baylor Scott & White Health et al., case number 5:17-cv-00886, in the US District Court for the Western District of Texas.