March 26, 2013

OIG Issues Special Fraud Alert - PODs "Inherently Suspect"

WASHINGTON (March 26) – The Office of the Inspector General of the Health and Human Services Department has issued a Special Fraud Alert that physician-owned distributorships (PODs) are “inherently suspect” under the anti-kickback statute (AKS) and has listed suspicious characteristics that may increase the risk of fraud and abuse.
The alert focused on physician-owned businesses / PODs that obtain revenue from selling implantable medical devices ordered by their physician owners to use in procedures they perform on their patients at hospitals or ambulatory surgical centers.

“The opportunity for a referring physician to earn a profit, including through an investment in an entity for which he or she generates business, could constitute illegal remuneration under the anti-kickback statute,” said the IG alert .

One purpose of the anti-kickback statute (AKS) is to protect patients from inappropriate medical referrals or recommendations made by health care professionals who may be unduly influenced by financial incentives. It a criminal offense to knowingly and willfully offer, pay, solicit, or receive any remuneration to induce, or in return for, referrals of items or services reimbursable by a Federal health care program. When remuneration is paid purposefully to induce or reward referrals of items or services payable by a Federal health care program, the AKS is violated. Parties on either side of an impermissible “kickback” transaction are exposed to criminal liability. Violation of the AKS statute is a felony punishable by up to 5 years imprisonment, a maximum fine of $25,000 or both. Individuals convicted of violating the AKS are excluded from Federal health care programs, including Medicare and Medicaid. OIG also has the right initiate an administrative action to exclude persons from the Federal health care programs or to impose civil money penalties for fraud, kickbacks, and other prohibited activities under sections 1128(b)(7) and 1128A(a)(7) of the Act.

The financial incentives that PODs offer to their physician owners may influence them to perform medically unnecessary procedures and to use the devices the PODs sell instead of other more appropriate devices.

According to the Special Fraud Alert, the OIG is “particularly concerned about the presence of such financial incentives in the implantable medical device context because such devices typically are ‘physician preference items,’ meaning that both the choice of brand and the type of device may be made or strongly influenced by the physician, rather than being controlled by the hospital or ambulatory surgical center where the procedure is performed.”

If you or someone you know has been accused of violating the anti-kickback statute, for serious health care fraud defense, contact attorney Robert Malove (954)861-0384.

March 13, 2013

Convicted Houston Doctor Sentenced to More than 5 Years Behind Bars

HOUSTON (March 13) - A Texas doctor who was convicted of conspiracy to commit health care fraud and six counts of false statements relating to health care matters was sentenced today to serve 63 months behind bars.

Ben Harris Echols, 63, of Houston, was convicted late last year of conspiring to commit health care fraud by falsifying plans of care for Medicare beneficiaries, including patients whom he did not treat, as part of a $17.3 million Medicare fraud scheme. Upon completion of his prison term, Echols was ordered to serve three years of supervised release and pay restitution in the amount of $2,918,830.

According to evidence presented at trial, Echols signed plans of care for Medicare beneficiaries who were not under his care and about whose conditions he had no knowledge. In many instances, Echols signed plans of care even though other doctors were listed as the attending physician on the documents.

Echols was prosecuted by the Medicare Fraud Strike Force, supervised by the Criminal Division's Fraud Section and the U.S. Attorney's Office for the Southern District of Texas.

If you or someone you know is facing prosecution as a result of aggressive law enforcement activity in the area of Medicare or Medicaid fraud, call Board Certified Criminal Trial Lawyer Robert Malove, co-author of the noted treatise, White Collar Crime: Health Care Fraud (Thompson West 2012-2013 ed.)