Tuesday, January 31, 2012

U.S. to Force Drug Firms to Report Money Paid to Doctors

From the New York Times:
To head off medical conflicts of interest, the Obama administration is poised to require drug companies to disclose the payments they make to doctors for research, consulting, speaking, travel and entertainment. 
Click here for the rest of the story.

Monday, January 30, 2012

Whistleblowers Group Launches Campaign Against Bill that would gut the SEC Whistleblower Program

Last year, GOP Congressman Michael Grimm proposed legislation that would steer whistleblowers through companies’ internal systems rather than the U.S. Securities and Exchange Commission, something he was criticized for at the time. Noting that the legislation “has passed the initial mark-up and is poised for full approval,” the National Whistleblowers Center announced yesterday it is launching a campaign against the “Grimm Act,” which it says ”systematically rolls back every whistleblower provision included in the Dodd-Frank Wall Street Reform Act.”

Click here for more information.

Friday, January 27, 2012

Madoff whistle-blower: ‘No One Would Listen’

Why were the SEC and CFTC whistleblower programs created?  Because the SEC wouldn't listen to Harry Markopolos, who made reported reports to the Government about Madoff's Ponzi scheme.

Now, with these new whistleblower programs, SEC and CFTC will be forced to listen.  Fortunately, the SEC whistleblower program is staffed with competent professionals.  

View the story below.  Buy Markopolos' book.  Click here for a link to a detailed interview of Markopolos.  By the way, I didn't know Markopolos was a former Army Infantry Officer.   Hooah!





My article for the Advanced Employment Law Course

Here is my article for the State Bar of Texas Advanced Employment Law Course, Dallas, Texas 2012

22_Hargrove(1)

My slides for the Advanced Employment Law Course

Here are my slides for my presentation to the State Bar of Texas Advanced Employment Law Course, Dallas 2012.

Hargrove (SBOT -- Dallas Jan. 2012)

Thursday, January 26, 2012

DoJ issues recent recovery numbers under the FCA -- $30 Billion

Using the False Claims Act, the Government has collected $30,315,593,792 since 1987.  $21,019,560,124 of that was collected through Qui Tam actions filed by whistleblowers.  

C-frauds Fca Statistics

Is giving patients the "VIP Treatment" an unlawful kickback?

Fierce Health Care has an interesting piece that smacks of kickbacks to patients.  Here is the article:
It's not just good care that will drive patients to hospitals, but customer loyalty programs and good service--or at least, that's what hospitals think who are getting in on the trend. As more hospitals aim to stay competitive, some are offering VIP (very important person) memberships that offer perks, such as free parking, wellness seminars and even organized social events, reported Kaiser Health News and The Washington Post.
For instance, Botsford Hospital in Farmington Hills, Mich., in 2010 began issuing free VIP cards, which entitle holders to free parking, a 10 percent discount on nonprescription drugs at the outpatient pharmacy and the gift shop, restaurant discounts, service establishments such as an oil-change garage and financial perks for health seminars. Even more, VIP members get a free one-year membership to a program for people 50 and older for organized outings, including a trip to a Canadian casino, the article noted.
"In this day and age, with so much competition, you need to make a connection with patients," Lynn Anderson, Botsford Hospital marketing and public relations manager, said in the article.  Similarly, The New York Times yesterday reported that the lines between hospital and hotel could be blurring. For example, the luxury wing of the New York-Presbyterian Hospital's Weill Cornell Medical Center offers $2,400 suites and other luxury amenities, such as chefs and butlers to cater to affluent patient needs.
. . .
For more information:
- read the KHN and Washington Post article
- read the NPR blog post

Related Articles:
Hospitals cater to wealthy patients despite safety net mission
Angling for donors, hospitals give VIP emergency treatment
Reward VIPs (very important patients), boost patient satisfaction
Concierge practices multiply as more docs drop Medicare

Texas AG Settles Another Medicaid Pharma Fraud Case


As reported in Reuters, an Icelandic corporation with United States subsidiaries, Actavis Group, has settled a long and contentious Medicaid fraud case for $84 million. Texas filed suit against the corporation, claiming it inflated the price of generic drugs and billed the increased costs to Medicaid. The ruse caused Medicaid to significantly overpay pharmacies for the generic drugs.  After a long trial, the jury found the corporation liable and ordered it to pay $170.3 million in damages.  Actavis appealed that verdict.  While the appeal was pending, both parties reached an agreement in which Actavis would pay $84 million to settle the claim.  The terms of the settlement agreement provide that the parties pursue no further litigation. 

Actavis did not admit to any wrongdoing as part of the settlement agreement and even thought that the settlement was a favorable outcome. The CEO of Actavis, Inc. had this to say: “Actavis will continue to report our product pricing in an [sic] manner consistent with all applicable laws as well as the terms of this agreement.” This case, like many other health care fraud cases, began as a whistleblower case and the state of Texas intervened in the suit. The whistleblowers will now receive a portion of the $84 million settlement.

Several states have false claims legislation similar to the federal False Claims Act and these states, like Texas, are using that legislation to keep a tight lid on Medicare and Medicaid fraud. The federal government is not the only one in the fight against health care fraud. States are also taking a stand. It seems like governments are beginning to realize that a possible solution to the perpetual budget deficits is to attempt to recover the millions paid out in false health care claims. Once governments begin to change the policy of pay now, ask questions later, there will be more money in the budget to satisfy the needs of that government’s constituents.

Texas and the lawyers in its Attorney General's office are doing a good job keeping these pharma companies honest, and, when they cross the line, holding them accountable.

Below is the settlement agreement.

DoD - Cargo fraud case settles for $31.9 Million


The Department of Justice announced that it has resolved a suit involving cargo-shipping fraud.  The suit was brought by an industry insider as a whistleblower action accusing Maersk Line Limited of overcharging the federal government for shipping cargo to troops stationed in Iraq and Afghanistan.  The government alleges that Maersk billed more than the contractual amount, added on excessive late fees by disregarding the necessary grace period in the contract, billed for deliveries not requested by the government, and failed to take into account some necessary rebates to which the government was entitled.  The whisltleblower is slated to receive $3.6 million as his share of the recovery by the government.  

Kudos to the Army CID and DCIS agents.

Wednesday, January 25, 2012

Obama announces new financial crimes unit

From The Hill:
President Obama announced a new unit devoted to major financial crimes as he offered tough words for Wall Street during his State of the Union address.
The unit will be staffed by "highly trained investigators" and charged with tracking "large-scale fraud." Obama argued Tuesday night that financial firms currently have little to fear for violating the law, and pressed Congress to beef up penalties for financial wrongdoing.
. . . 
The president also announced that Attorney General Eric Holder has been charge with establishing a special team of federal prosecutors and state attorneys general devoted to investigating abusive mortgage lending and the packaging of risky mortgages that contributed to the financial crisis.
My two cents: what has taken them so long.  But of course one wonders if the Government itself will reform its responsiveness to whistleblower complaints.  It's no secret that the DoJ and other agencies (e.g., HHS-OIG, DCIS, etc.) are woefully understaffed. 

Pharmalot webinar: Strong Medicine: Strategies for Anti-Corruption Compliance in the Pharmaceutical Industry


Today at 1:00 PM EST

Click here for the link.

Here is a description:
The prosecution of global businesses under the Foreign Corrupt Practices Act (FCPA) is on the rise, with pharmaceutical and life sciences companies at the top of the DOJ’s list for investigations. Penalties in the hundreds of millions are no longer unusual. Under the FCPA companies can be liable for violations by agents, intermediaries and subsidiaries, as well as employees.

In this webinar, experienced enforcement and compliance attorney William Barry, of Richards Kibbe & Orbe LLP, will discuss how pharmaceutical companies can protect themselves and their employees from prosecution for FCPA violations. This presentation is tailored for compliance and legal professionals in the pharmaceutical industry, as well as marketing and operational personnel involved in cross-border business in the industry. Topics covered will include:
  • FCPA Prohibited Payments
  • Record Keeping and Accounting Controls Provision
  • Internal Compliance Programs
  • High Risk Areas in the Pharmaceutical Industry and FCPA Risk Mitigation Essentials
 

Another cardiologist whistleblower case -- AMA concludes 12 percent of angioplasty surgeries nationwide are "inappropriate"

A cardiologist is suing what is now UPMC Hamot, claiming the Erie, Pa., hospital and physicians allegedly performed unnecessary angioplasty procedures and other surgeries while defrauding Medicare from 2001 to 2005, the Erie Times News reported. Tullio Emanuele, the cardiologist once affiliated with Hamot Medical Center, is accusing the hospital of engaging in sham contracts with Medicor Associates Inc. and its affiliate, Flagship Cardiac, Vascular and Thoracic Surgery of Erie that amounted to kickbacks in exchange for referrals.
The suit claims that one patient died after undergoing a heart catheterization that he did not need, and another patient died from complications from unnecessary bypass surgery.  "As the result of the fraudulent practices," Emanuele says in the suit, "Medicare overpaid for cardiac and vascular surgical and diagnostic services for its beneficiaries. Those patients were placed at significant and unnecessary risk of harm, and substantial public dollars were wasted."
The Erie-Times News broke the story.  This startled me:
The claims, made in a whistle-blower suit filed in U.S. District Court in Erie, come as the national medical community is scrutinizing angioplasty procedures, which commonly include the insertion of stents -- tiny mesh metal tubes meant to keep an artery open and improve blood flow.

A study published in the Journal of the American Medical Association in July found 12 percent of angioplasty procedures nationwide were "inappropriate."

Wednesday, January 18, 2012

The Rare “Not Guilty Plea” in a Health Care Fraud Case

B. Elise Miller, of Coshocton, Ohio, entered a not guilty plea as she stood before federal magistrate Kathleen Burke, according to a recent report by ZanesvilleTimesRecorder.com.  She was indicted on fourteen counts of health care fraud this month and she has decided that professing her innocence is the best defense strategy.


The indictment stems from a joint health care fraud investigation conducted by the Ohio Attorney General’s office, United States Department of Health and Human Services, the Ohio Department of Insurance, and the FBI. Miller’s indictment is the most recent one, but back in 2010, Miller, her husband, Dana Campbell, and two other employees were separately indicted on separate federal charges.
Miller’s 2010 indictment charged her with witness tampering, obstruction of an official proceeding, concealment of records. Miller was the head of Three Rivers Infusion and Pharmacy Specialists. Her husband, Campbell, served as vice president. The current indictment charges Miller with defrauding Medicare and Medicaid by submitting claims under an alternate company’s name to avoid review of other claims by Three Rivers. Three Rivers billed Medicaid and Medicare Mutual of Ohio (MMOH) under the name Holzer Infusion Services. When MMOH finally figured out that Holzer and Three Rivers were one and the same, MMOH had already reimbursed Holzer over $700,000.


Separate charges in the indictment allege that Miller and Three Rivers submitted false claims relating to the drug Synagis. The search warrant and the affidavit contend that a home health care company received orders for the drug, but the drug was actually shipped to the patient’s home. A nurse would be sent to the home to administer the drug, but records reveal that Medicaid was billed for at least twice the amount of the doses of the drug actually administered.


If Miller is convicted of these charges, she faces up to ten years in prison.  Miller is of course presumed innocent until proven guilty.  

Tuesday, January 17, 2012

CMS inaction leaves system holes for fraud, abuse


The Centers for Medicare & Medicaid Services (CMS) has been slow to respond to contractor-identified weaknesses in the system that allow for fraud, waste and abuse, according to a report by the Office of Inspector General (OIG), issued Friday. CMS needs to take prompt action to fix potential leaks in the system, the OIG recommended.

As of January, CMS has not resolved or taken action on more than three-fourths (77 percent) of identified vulnerabilities--mostly having to do with coding/billing and provider identifiers--reported by Program Safeguard Contractors, Zone Program Integrity Contractors and Medicare Drug Integrity Contractors in 2009. Out of the 62 vulnerabilities, CMS has not resolved 48 of them, according to the OIG report. CMS said 20 of them are "currently under review," and three require more analysis. OIG determined that CMS either didn't take action or took insufficient action in the remaining 25 identified weaknesses, but the federal agency did take action on 14 of the total 62 potential vulnerabilities.

CMS' inaction on these vulnerabilities could cost $1.2 billion, according to contractors who reported the financial impact for only a third of the vulnerabilities.

"Because monetary impact was reported inconsistently or not at all, the actual monetary impact of the vulnerabilities reported in 2009 could be significantly greater than $1.2 billion," the OIG report states.


CMS noted that it's labor intensive for contractors to determine the dollars at risk for all vulnerabilities and not all vulnerabilities have a monetary impact.

Although CMS has started to develop procedures to consistently track and review vulnerabilities, it still lacks procedures to ensure they are resolved, according to OIG. Contractors have been submitting vulnerability reports for several years, but CMS did not begin developing procedures until June 2010.


CMS stated that it continues to actively manage reported vulnerability on a monthly basis and that it can establish time frames for resolution on a case-by-case basis.

To learn more:
- here's the OIG press release
- read the OIG report (.pdf)



Thursday, January 12, 2012

$9 billion in False Claims Act recoveries in FY 2012 predicted

Taxpayers Against Fraud is predicting more than $9 billion in False Claims Act recoveries in FY 2012.  “The bottom line – $9 billion in recoveries – counting civil, state and criminal fines – is within the realm of possible for FY 2012,” said Patrick Burns of Taxpayers Against Fraud.

Among the big cases queued up or already settled:
  • Merck: The Vioxx off-label marketing fraud has been settled for $950 million.
  • GlaxoSmithKline: A series of drug frauds is said to be settled in principle for $3 billion.
  • Abbott: The company has reserved $1.5 billion to settle litigation associated with the illegal marketing of Depakote.
  • Amgen: The company has reserved $780 to settle litigation associated with the illegal marketing of Aranesp.
  • Oracle: The company has settled a GSA price-gouging case for $200 million.
  • NYC: New York City will pay $70 million for Medicare billing fraud.
  • LHC Groups, a home health care provider, will pay $65 million for billing fraud.
  • Pfizer: The company is expected to either go to trial or settle a case dealing with the illegal marketing of Protonix. The minimum recovery under either scenario is expected to be in excess of $500 million.
  • Ranbaxy: A settlement in excess of $400 million is expected for adulteration of HIV drugs.
  • Sandoz (Novartis): The company has agreed to pay $150 million for Average Wholesale Price fraud involving a series of drugs.
  • Maxim: The company has agreed to pay $150 million for Medicaid home health care fraud.
  • Johnson & Johnson: The company has agreed to settle a criminal charge related to illegal marketing of Risperdal, and a civil settlement in excess of $1 billion is expected.
  • Agility/Public Warehouse. The Kuwaiti-based defense contractor is expected to settle a price-gouging case for a sum in excess of $500 million.
  • WellCare Health Plans: The company has reached a preliminary deal with DoJ for a sum in excess of $137 million, to settle a case involving billing for newborn health care services.
  • Medtronic: The company has agreed to pay over $23 million for fraud related to cardiac defibrillators and pacemakers.

Wednesday, January 11, 2012

Maxwell qui tam oil royalty case settled

From Law Week online:
The long fought federal False Claims Act qui tam action that whistleblower Bobby Maxwell prosecuted on behalf of the U.S. Department of Justice against Anadarko Corp. settled yesterday. Anadarko agreed to pay $26 million, a majority of which will be payments to the government. Maxwell, a former auditor with the former federal Minerals Management Service brought the case against Anadarko back in 2004 alleging that Kerr-McGee Oil & Gas Corp., a successor of Anadarko, had knowingly filed false federal crude oil royalty reports from Jan. 1999 to Dec. 2002. resulting in underpayment to the government of approximately $7.5 million.
What I find significant is that the whistleblower was a former auditor with the Minerals Management Service and suffered acts of reprisal by the MMS.  Let's hope that the DoJ sees the light and starts appreciating government whistleblowers rather than accusing them of being bad people.   Government whistleblowers are often in the best position to ferret out fraud.  But because of the nature of a bureaucracy, the brass tries to sweep the fraud under the rug rather than remedying the problem.  Taxpayers suffer of course; patients often suffer as well. It's been my experience that government whistleblowers almost always first blow the whistle within the government, to only be punished by their superiors, and are left no choice but to file a qui tam case.  In many situations, courageous government whistleblowers are the only ones that have the backbone to do the right thing and protect taxpayers.      

Office Manager Pleads Guilty in Medicaid Fraud

According to a recent report by WSLS, a Health Care Virginia (HCVA) employee has pleaded guilty to defrauding Medicaid. The employee was Agnes Vint of Selma, Virginia. She was the office manager at HCVA. She, along with several others, was indicted back in March. She pleaded guilty to one count of “making false statements in writing relating to health care matters.” The prosecuting United States Attorney said, “This case sends a strong message that providers who falsify official documents in a federal health care benefit program such as Medicaid or Medicare will be vigorously prosecuted… This is the type of fraud that wastes our precious health care dollars. Ms. Vint has been appropriately brought to justice for her criminal activity.”

HCVA is a Covington, Virginia based corporation whose purpose was to provide health care services to Medicaid patients.  In 2007, HCVA became a Medicaid provider after it entered into an agreement with the Department of Medical Assistance Services (DMAS).  DMAS required its employees who provided personal care to be trained and supervised by a registered nurse.  Vint’s crime was covering up the fact that several of the personal care aids lacked the training required by DMAS.  Because of this cover-up, HCVA was able to bill Medicaid for nearly $1,000,000.00 for the services of untrained personal care providers. 

The corporation itself was also indicted, has pleaded guilty, and has already been sentenced. HCVA was sentenced to three years of probation and ordered to pay a fine and restitution. Federal officials are beginning to crack down on health care fraud because they are realizing that, not only is it costing American taxpayers millions and millions of dollars, but it is also putting hundreds of Medicare and Medicaid patients at risk.

“Vint was part of a scheme that not only defrauded Medicaid patients and taxpayers, but it also potentially put infirm patients in extreme danger. She even falsified documents to state that patients were getting required nursing visits when they were not. I am just grateful that our investigators were able to stop such a cold and heartless act," said Attorney General Ken Cuccinelli. Health care fraud is on the rise, but the federal government is trying to keep a tight lid on it.

Tuesday, January 10, 2012

Cone-beam CT scanners and the business of dentistry -- what explains the trend

From the New York Times:
Because children and adolescents are particularly vulnerable to radiation, doctors three years ago mounted a national campaign to protect them by reducing diagnostic radiation to only those levels seen as absolutely necessary.  It is a message that has resonated in many clinics and hospitals.  Yet there is one busy place where it has not: the dental office.
Not only do most dentists continue to use outmoded X-ray film requiring higher amounts of radiation, but orthodontists and other specialists are embracing a new scanning device that emits significantly more radiation than conventional methods, an examination by The New York Times has found.
Designed for dental offices, the device, called a cone-beam CT scanner, provides brilliant 3-D images of teeth, roots, jaw and even skull. This technology, its promoters say, is a safe way for orthodontists and oral surgeons to work with more precision and to identify problems that otherwise might go unnoticed.
But there is little independent research to validate these claims. Instead, the cone beam’s popularity has been fueled in part by misinformation about its safety and efficacy, some of it coming from dentists paid or sponsored by manufacturers to give speeches, seminars and continuing education classes, as well as by industry-sponsored magazines and conferences, according to records and dozens of interviews with dentists and researchers
Read the rest of the story . . . 

See the video below.

Let's hear the comments from the industry and practice.

Actavis Will Pay $118.6 Million to End Drug-Pricing Claims

From Bloomberg:
Units of Actavis Group Hf agreed to pay $118.6 million to resolve claims that they caused the U.S. and four state governments to overpay for drugs.  The settlement, filed Dec. 29 in federal court in Boston, followed an $84 million accord announced a day earlier in a lawsuit by the state of Texas, bringing the total to $202.6 million.  In February, a state court jury in Austin ordered units of the Iceland-based company to pay $170 million for inflating billings to the Texas Medicaid program.
From the Texas Attorney General:
Texas Attorney General Greg Abbott secured an $84 million agreement with pharmaceutical manufacturer Actavis Mid-Atlantic, LLC and Actavis Elizabeth, LLC.  The agreement resolves the State’s civil Medicaid fraud enforcement action against Actavis, which was charged with defrauding the taxpayers and improperly reporting drug prices to the Texas Medicaid program.  Under the settlement agreement, the Attorney General’s Office recovered $29.23 million for the State’s general revenue fund.

CFTC Chairman Names Vincente Martinez as Director of Recently Opened Whistleblower Office

From the press release:
Commodity Futures Trading Commission (CFTC) Chairman Gary Gensler today announced that Vincente Martinez has been hired as the first director of the CFTC’s recently opened Whistleblower Office.  “The CFTC’s Whistleblower Office, which the agency implemented under the Dodd-Frank Act, provides the public an avenue to help catch misconduct in the markets and improve the CFTC’s ability to be an effective cop on the beat,” Chairman Gensler said.

Monday, January 9, 2012

Fraud fighters getting recognition by presidential candidates

 From the Washington Post:
GINGRICH: “The duty of the president is to find a way to manage the federal government so the primary pain is on changing the bureaucracy. On theft alone, we could save $100 billion a year in Medicaid and Medicare if the federal government were competent. That’s a trillion dollars over 10 years. And the only people in pain would be crooks.”
If policymakers once viewed health care fraud as akin to a cost of doing business, that hasn’t been the case for years. President Barack Obama’s health care overhaul law toughened penalties and gave law enforcement agencies new tools to combat fraud. That built on earlier efforts by the administrations of George W. Bush and Bill Clinton.
Health care fraud investigations are a major source of money recovered for taxpayers by the Justice Department, surpassing fines and penalties collected from defense contracting fraud.

HHS-OIG HEAT rolls out training videos

HHS-OIG's HEAT office (Health Care Fraud Prevention and Enforcement Action Team) is rolling out a series of training videos.  See on the Stark Law training video below.  These videos are part of HEAT's Provider Compliance Training initiative.  While the videos are overly simplistic for health care fraud lawyers, providers may find them helpful. 

   

Shell Companies Milk Medicare out of Millions


Medicare defrauders have now come up with a new and efficient way of eluding capture by the feds. Create a shell company. That is what happened when federal authorities finally got to the center of one of the largest and most complicated Medicare fraud cases in recent history.


Michel De Jesus Huarte was busted for running a fake AIDS clinic out of Miami, but, when the clinic was raided and the authorities shut it down, police had no idea who was the mastermind behind the scheme that had taken Medicare for more than $4.5 million. Huarte was extremely resourceful because he funneled the stolen Medicare funds into several shell companies, corporations that only exist on paper but do not have a physical structure and do not carry on any real operations. Huarte was never listed on any of the incorporation materials for any of these companies. He, along with several hundred others, was able to hide from authorities by using this technique.


Although Huarte has now been caught, convicted, and sentenced, a Reuters investigation has found that several others are using shell companies to hide fraudulent Medicare transactions. These “fraud rings” have become extremely popular. The perpetrators steal doctor information and patient information and then bill Medicare as soon as they are able to make the paperwork look legitimate. The goal is for each of the shell companies to put in as many Medicare reimbursement claims as they can before federal and state officials realize that they have been duped.


The scam is so easy that people are starting to get into the Medicare fraud act that one would think would be far removed from that kind of crime. HealthNews.com said this: “In one of the largest cases of Medicare fraud ever charged, the operation was enabled by shell companies. In October 2010, federal prosecutors indicted 44 members of an Armenian organized crime ring. Their network, which stretched from Los Angeles to Savannah, Ga., used 118 shell companies in 25 states to pose as Medicare providers, billing more than $100 million, according to federal indictments in three states.”


Criminal gangs whose crimes of choice used to be drug dealing, stealing, and murdering are now finding that it is much more lucrative to be on the white collar side of the crime table.

Sunday, January 8, 2012

Former Parkway Hospital CEO indicted for bribing NY State Senator

The former CEO of Parkway Hospital in Queens, N.Y., pleaded guilty to bribing former State Sen. Carl Kruger (D-Brooklyn), the Federal Bureau of Investigations (FBI) announced this week.

According to the indictment, the complaint and statements made during Tuesday's plea proceeding, Dr. Robert Aquino in 2008 made Parkway Hospital pay $60,000 to Adex Management Inc., a company in which Kruger had interests. Aquino said he made the payments to Adex in exchange for Kruger's help to keep Parkway Hospital open.

Saturday, January 7, 2012

El Paso doc sentenced 25 years for health care fraud

From my hometown:  Dr. Valdez, an El Paso psychiatrist, was sentenced to 25 years in prison for health care fraud.

United States Attorney Robert Pitman announced that in El Paso today, 57-year-old Anthony Francis Valdez was sentenced to 25 years in federal prison followed by three years of supervised release in connection with an estimated $42 million fraudulent health care benefit program billing scheme. Valdez, a former physician, was the owner of the Institute of Pain Management with clinics in El Paso and San Antonio.
“Valdez preyed on the most vulnerable members of our society—the poor, the disabled and the elderly. In doing so, he sought to enrich himself by billing health care entitlement programs, such as Medicare, Medicaid and Tri-Care, of more than $42 million during a five-year period for services he did not perform. As a result, Valdez has lost his medical license, his reputation, his property and most of all his freedom. We hope his sentence of 25 years serves as a deterrence to others who would contemplate defrauding these federally funded health care programs,” stated United States Attorney Robert Pitman.
In addition, Senior United States District Judge David Briones ordered that Valdez pay $13,356,645.44 restitution; and, forfeit more than $1.7 million in cash, his residence in El Paso, his residence in San Antonio, as well as five vehicles. Judge Briones also handed down a monetary judgement against Valdez for $9,741,649.
Click here for my earlier postings.  

Friday, January 6, 2012

Study Shows Retaliation Against Whistleblowers is Increasing

LL: What is the biggest headline out of this study?

PH: The biggest news is that there has been a significant increase in retaliation against whistleblowers for reporting ethics and compliance violations.  In ’07 it was 12 percent in ‘09 it was 15 percent and now its 22 percent.

The retaliation involves everything from behaviors that are subtle (such as being left out of key discussions or team projects) to more overt disciplinary action (such as being transferred, not being able to get a bonus or a raise or being transferred). Thirty-one percent of employees even experience physical harm to their person or property for having reported wrongdoing in the workplace. The challenge for business is creating an environment where people are comfortable and protected for alerting management about unethical behavior. 

Check out this story.  


Article: http://www.cnbc.com/id/45884577

Study website and article links: http://www.ethics.org/nbes/

Thursday, January 5, 2012

DoJ Recovers Billions from Health Care Fraud Cases

The False Claims Act proved its effectiveness once again.  Last year DoJ recovered a record amount of money in health care fraud cases.  While this is real money, it's still a very small percentage of the amount of money stolen through fraud.  We are recovering pennies on the dollar.  Most experts estimate that health care fraud amounts to at least $100 Billion per year (probably even more).  So collecting $3 or $4 Billion out of a fraud pot of $100 Billion is chump change.  We have a lot of work to do in order to protect taxpayers. 

Listen to the story below.

Wednesday, January 4, 2012

Great Blog - Dentist the Menance

Check out Dentist the Menance . . . one tough lady who is taking on the dental mill establishment. Dental Medicaid fraud is rampant--especially here in Texas.  Not only does it waste the States' Medicaid budgets, but it harms honest dentists, and, of greatest concern, has harmed thousands of kids.  The dentistry mill industry has tried to silence whistleblowers and trample First Amendment rights.  To all of you that are courageous enough to take on the wrongdoers, I say Keep up the Good Fight!  To the honest dentists, you need to stand up or you will keep steamed rolled by these greedy bastards. 


Tuesday, January 3, 2012

Will 2012 be the year of the bounty hunter

The Economist has an interesting piece forecasting that 2012 will be the year of the bounty hunter.  I agree.  Here is an excerpt:
Governments, in a fiscal pickle after bailing out their banks, will devote more effort to stamping out the types of fraud that pillage the public purse (in Medicare, say, or military procurement). Financial regulators, having failed abysmally to root out wrongdoing before 2008, will increasingly look to outsource policing to corporate sleuths and insiders who are closer to the action. Tips are by far the leading source of fraud detection (see chart).
This will be most apparent in America. The Dodd-Frank Act, passed after the crisis, offers whistleblowers strong protections from retaliation and bounties of up to 30% of awards resulting from their tip-offs. The measures, which went into effect in August, “could be a game-changer because they turn everyone into a potential whistleblower,” says Gary Aguirre, who exposed the soft treatment by the Securities and Exchange Commission (SEC) of Wall Street bigwigs in an insider-trading case. All the SEC, which will administer the programme, has to do is “be patient enough to listen,” he adds.