Monday, February 27, 2012

DoJ using the Espionage Act to prosecute whistleblowers

From today's NYT.  Here is an excerpt:
The Espionage Act, enacted back in 1917 to punish those who gave aid to our enemies, was used three times in all the prior administrations to bring cases against government officials accused of providing classified information to the media.  It has been used six times since the current president took office.

Pennsylvania dentist arrested for drug and Medicaid fraud

A report in the Observer-Reporter mentioned how one Washington County, Pennsylvania dentist, who allegedly prescribed more than 6,600 narcotic pain killers to seven patients, was recently arrested by state narcotics and Medicaid fraud agents.

Dr. Charles Kokoska, was charged by the state attorney general's office.  According to the criminal complaint, between January 2009 and October 2010 Dr. Kokoska wrote more than 300 prescriptions for more than 6,600 narcotic pain killers to at least seven different patients.

The prescriptions were written for the powerful prescription pain killers Oxycodone, Hydrocodone, and Propoxyphene and filled at various pharmacies in Allegheny, Fayette, Greene and Washington counties. Kokoska also wrote prescriptions for Diazepam, a generic form of Xanax, commonly used to treat anxiety.

Dr. Kokoska is charged with seven counts of prohibited acts by medical professional and two counts of provider prohibited acts. He was arraigned before Brownsville Magisterial District Judge Joshua Kanalis and released on $25,000 unsecured bail.

Friday, February 24, 2012

Dentist who used paperclips for root canal sentenced to jail time

According to a recent report by the Associated Press, Dr. Michael Clair, a former dentist who substituted paper clips for stainless steel posts in root canals, was sentenced to one year in jail on Monday.

Clair pleaded guilty earlier this month to charges including assault and battery, illegally prescribing medication, witness intimidation and defrauding Medicare of $130,000.

Prosecutors say that Clair sometimes used pieces of paper clips while performing root canals. This caused infections and other problems in patients.

One woman said her teenage son's tooth turned black and had to be removed after Clair gave him a root canal in 2005.

"He put my kids in pain for months ... I hope he rots there," said Brenda Almeida after Judge Richard Moses sentenced Clair to a year in the Bristol County House of Correction.

Prosecutors had asked for a sentence of five to seven years, but Judge Richard Moses gave Clair two-and-a-half years, with all but one year suspended, plus five years of probation. The judge said he considered Clair's lack of a criminal record, "certain mental health issues" and acceptance of responsibility in handing down the sentence.

In a statement Massachusetts Attorney General Martha Coakley said Clair fraudulently billed Medicare for stainless steel posts while using office supplies on his patients to save money. Prosecutors said Clair was suspended by Medicaid in 2002 but continued to file claims between August 2003 and June 2005 by using the names of other dentists in his practice.

"The defendant physically and emotionally harmed his patients by taking advantage of the trust they placed in him as their dentist," Coakley said in a statement. "Mr. Clair brazenly cheated the Medicaid program and defrauded taxpayer dollars, billing for health care services he did not provide."

Prosecutors requested that Clair be ordered to stay away from his victims and seven people who worked in his office because former staff members "have expressed concern for their safety." Judge Moses granted the request.

Watch the video below:

Hat tip to Dentist The Menace.

Thursday, February 23, 2012

Good article in USA Today about the effectiveness whistleblowers

Click here for the full article.  This is interesting:
Health and Human Services Secretary Kathleen Sebelius said last week that her budget included an additional $300 million to take on health care fraud.
While $300 million sounds like a lot, it's woefully inadequate to tackle our health care fraud crisis.  See Prof. Sparrow's analysis to learn what is actually needed. 

Louisiana dentist convicted of Medicaid fraud

It’s not been a good month for dentists committing Medicaid fraud, at least not according to the Shreveport Times:

Shreveport dentist David Earl Reed faces prison and fines after a conviction on two counts of Medicaid fraud.

Reed, 56, was barred from participating in the Medicaid program after a fraud conviction in 1992.

He continued applying to participate in the program from 2006 to 2008 and was denied. In 2009, state health officials told him he would be barred from the program for at least five more years.

However, from 2005 to 2007, Reed treated Medicaid patients while working for another Shreveport dentist. Reed submitted false billing claims to the program under the other dentist's provider number and received payment from Medicaid.

Health providers excluded from the program can't provide any services that will be billed directly or indirectly to Medicaid. It's a crime to be employed by, have a contract with or have an ownership interest in a healthcare provider that bills Medicaid, said Louisiana Attorney General Buddy Caldwell.

Reed will be sentenced April 27. He faces up to five years in prison and fines up to $20,000 on each fraud count.

Wednesday, February 22, 2012

Virginia dentist swept up in health care fraud case

The following press release from the United States Attorney for the Eastern District of Virginia discusses the recent guilty plea by a dentist for health care fraud.  

Tuan Vu, 43, of Annandale, Va., pleaded guilty today to fraudulently billing insurance providers hundreds of thousands of dollars for dental services that he did not provide to his patients. 

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the plea was accepted by United States District Judge Liam O’Grady. 

Vu was charged today by criminal information with health care fraud, and he faces a maximum penalty of 10 years in prison when he is sentenced on May 4, 2012. 

In a statement of facts filed with his plea agreement, Vu admitted to committing health care fraud from at least January 2007 to September 2011.  Vu is the owner of Cosmetic & Family Dentistry, PLLC, a dental practice located in Alexandria, Va.  During the time of his health care fraud scheme, Vu consistently billed dental insurance providers for services that he did not provide his patients.  As a result of Vu’s offense, at least 10 private insurance providers suffered more than $400,000 in losses.  Dr. Vu’s conduct also resulted in a substantial loss to the federal government and the Commonwealth of Virginia, including $87,389 to the Federal Employee Health Benefits Program and $180,048 to the Virginia Medicaid program.

This case was investigated by the FBI’s Washington Field Office.  Assistant United States Attorney Chad Golder is prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at  Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at or on

Hat tip to Dentist The Menace.

Tuesday, February 21, 2012

North Carolina dentist guilty of health care fraud

According to a recent report from 
WMFY News in Greensboro, North Carolina, a dentist admitted to massive health care fraud.

Thursday, the US Attorney's Office accepted a plea deal with Tung Thai Nguyen. Nguyen pleaded guilty to health care fraud charges in connection with false claims submitted to Medicaid.

Dr. Nguyen, 40, pleaded guilty, in A Winston-Salem federal court room, to two counts of violating health care fraud and one count of violating 18 false entries in a matter involving a health care benefit program.

According to documents filed in Court, Dr. Nguyen submitted claims to the Medicaid program for dental restorations not actually performed. Dr. Nguyen also submitted a claim to the Medicaid program for the installation of one type of partial denture when he actually furnished a less expensive and different partial denture to the patient.

Nguyen will be sentence in February 2012. He faces the maximum possible penalty for a health care fraud violation, which is not more than ten years imprisonment, a maximum fine of $250,000, and a term of supervised release not to exceed three years. The maximum possible penalty for a false entry violation is not more than five years imprisonment, a maximum fine of $250,000, and a term of supervised release not to exceed three years.

The Court may also order the defendant to pay restitution to the health care benefit program.

The case was investigated by the Health and Human Services Office of Inspector General and the North Carolina Attorney General's Medicaid Investigations Unit and prosecuted by Assistant United States Attorney Robert Hamilton.

Below are the Indictment and Plea Agreement.
Dentist Nguyen Plea
Dentist Nguyen Indictment

Monday, February 20, 2012

New Jersey dentist indicted for Medicaid fraud

An announcement from the Office of the New Jersey Attorney General:
Attorney General Jeffrey S. Chiesa announced that a Monmouth County dentist has been indicted for allegedly submitting false claims to the Medicaid program.  Ping Cai, 49, of Holmdel, a licensed dentist whose practice is located in Hazlet, was charged with second-degree health care claims fraud and two counts of third-degree Medicaid fraud.

The Monmouth County grand jury indictment alleges that between Jan.1, 2007 and Jan.1, 2010, Cai fraudulently billed the Medicaid Program for dental service purportedly rendered to Medicaid recipients.  It is alleged that Cai submitted fraudulent claims for payment from Medicaid for relining and rebasing of dentures and filling of cavities when those dental services were not rendered. 

An investigation by the Office of the Insurance Fraud Prosecutor’s Medicaid Fraud Control Unit determined that, as a result of alleged fraud, Cai was allegedly paid more than $39,000 by Medicaid for the services that were not rendered. Deputy Attorney General Linda A. Rinaldi and Detective Ralph Anilo were assigned to the investigation. Rinaldi presented the case to the Monmouth County grand jury.    

The indictment, which was voted on Jan. 23 but handed up yesterday, is merely an accusation and the defendant is presumed innocent until proven guilty. Second-degree crimes carry a maximum sentence of 10 years in state prison and a criminal fine of $150,000, while the crime of third-degree Medicaid Fraud carries a maximum sentence of three years in state prison and a criminal fine of $10,000. 

Acting Insurance Fraud Prosecutor Ronald Chillemi thanked Medicaid for referring the matter to the Office of the Insurance Fraud Prosecutor. Acting Insurance Fraud Prosecutor Chillemi noted that some important cases have started with anonymous tips.  “People who are concerned about insurance cheating and have information about a fraud can report it anonymously by calling the toll-free hotline at 1-877-55-FRAUD, or visiting the Web site at  State regulations permit a reward to be paid to an eligible person who provides information that leads to an arrest, prosecution and conviction for insurance fraud.

Sunday, February 19, 2012

Texas Medicaid program $15 Billion in the hole

Two key leaders of Gov. Rick Perry's team highlighted growing budget problems in separate speeches this week, with one projecting at least a $15 billion hole in the Medicaid program . . .
Where is the money going?  No one knows for sure.

Dental Medicaid fraud, however, is out of control and driving Texas bankrupt.  While the Texas Attorney General's Office is aggressive and stocked with great lawyers and investigators, only whistleblowers will be able to bring to justice the crooks who are ripping off taxpayers and harming patients.

Who can be whistleblower?  Anyone who has original information about Medicaid fraud.  Dentists, dental assistants, office managers, and even patients have all successfully brought fraud cases against dental mills that are committing Medicaid fraud.  Most states have very good laws to protect whistleblowers.  Texas has an excellent law that protects whistleblowers and rewards them with 10 to 30% of what is recovered from those who commit fraud.  And because whistleblowers are afraid of retaliation, a fraud (qui tam) case is filed under seal and remains sealed for a significant period of time.  

Click here, here, and here for background.  

Saturday, February 18, 2012

HR 2483 -- the first major counter attack against whistleblowers

The counter attack against whistleblowers is on.  Watch the video below.  Fight HR 2483.  Here is the link to the legislation.  You've got to admire the chutzpah of the bill's sponsors.  Naming the bill "Whistleblower Improvement Act" is straight out of George Orwell's 1984.

Friday, February 17, 2012

Thursday, February 16, 2012

Medicare fraud strike force charges 91 individuals for approximately $295 million in false billing

A recent surprising announcement by the Department of Health and Human Services, discussed a recent takedown by the Medicare Fraud Strike Force of nearly 91 defendants including doctors, nurses and other medical professionals for participating in Medicare fraud schemes involving $295 million in false billing.

As part of a coordinated action, 70 individuals were charged by Strike Force prosecutors in indictments in six cities alleging a variety of Medicare fraud schemes involving approximately $263.6 million in false billings.  As part of takedown operations, 18 additional defendants were charged in Detroit and one defendant was charged in Miami in cases unsealed on Sept. 1, 2011, for their alleged roles in Medicare fraud schemes involving approximately $29.4 million in fraudulent claims.  This coordinated takedown involved the highest amount of false Medicare billings in a single takedown in Strike Force history.

The joint Department of Justice-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing.  Over the course of the sweep, approximately 400 law enforcement agents from the FBI, HHS-Office of Inspector General (HHS-OIG), multiple Medicaid Fraud Control Units, and other state and local law enforcement agencies participated in the takedown.  In addition to making arrests, agents also executed 18 search warrants in connection with ongoing strike force investigations. 

“The defendants charged in this takedown are accused of stealing precious taxpayer resources and defrauding Medicare  – jeopardizing the integrity of our health care system and our nation’s most critical health care program for personal gain,” said Attorney General Holder.  “Our highly coordinated, nationwide Strike Force operations are working aggressively to combat Medicare fraud and our anti-health care fraud efforts have never been more innovative, collaborative, aggressive – or effective.  We will continue to work with our law enforcement partners and partners across government to fight against health care fraud.”

“Today’s arrests are a powerful warning to those who would try to defraud taxpayers and Medicare beneficiaries,” said HHS Secretary Sebelius.  “These arrests illustrate close cooperation between the Medicare program that identified these fraudsters and the law enforcement officials who acted swiftly to cut them off.  And our efforts to stop criminals don’t end here because the Affordable Care Act gives us new tools to prevent Medicare fraud before it is committed – better protecting seniors and the integrity of the Medicare program for generations to come.”

The defendants charged are accused of various health care fraud-related crimes, including conspiracy to defraud the Medicare program, health care fraud, violations of the anti-kickback statutes and money laundering.  The charges are based on a variety of alleged fraud schemes involving various medical treatments and services such as home health care, physical and occupational therapy, mental health services, psychotherapy and durable medical equipment (DME). 

According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare for treatments that were medically unnecessary and oftentimes never provided.  In many cases, indictments and complaints allege that patient recruiters, Medicare beneficiaries and other co-conspirators were paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could submit fraudulent billing to Medicare for services that were medically unnecessary or never provided. Collectively, the doctors, nurses, medical professionals, health care company owners and others charged in the indictments and complaints are accused of conspiring to submit a total of approximately $295 million in fraudulent billing.

Since their inception in March 2007, Strike Force operations in nine locations have charged more than 1,140 defendants who collectively have falsely billed the Medicare program for more than $2.9 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.

An indictment is merely a charge and defendants are presumed innocent until proven guilty. To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to:

Wednesday, February 15, 2012

Patient recruiter pleads guilty -- kickbacks lead to convictions

Rodney D. Taylor, 45, pleaded guilty before U.S. District Judge James J. Brady of the Middle District of Louisiana to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and to pay and receive health care kickbacks. According to court documents, Taylor worked as a recruiter for Healthcare 1 LLC, Medical 1 Patient Services LLC and Lifeline Healthcare Services Inc., Louisiana-based companies that fraudulently billed DME to the Medicare program from 2004 to 2009.   He and other recruiters were hired to obtain prescriptions for DME such as leg braces, arm braces, power wheel chairs and wheel chair accessories.   Taylor obtained information from Medicare beneficiaries as well as prescriptions for medical equipment from the beneficiaries’ physicians.   Taylor then sold these prescriptions so they could be used by Healthcare 1, Medical 1 Patient Services and Lifeline Healthcare Services to submit fraudulent claims to the Medicare program.  
The indictment alleges that from 2004 to 2009 Medicare was billed more than $21 million as part of this conspiracy. 

Here is the Superseding Indictment: 
U.S. v. Jones et al (Indictment)
It appears that the remaining defendants intend to have their day in court.  Here is the proposed jury charge that the DoJ submitted to the Court:
U.S. v. Jones et al (US proposed jury charge)

Tuesday, February 14, 2012

Assistant Administrator of Houston Hospital Indicted for Alleged Role in $116 Million Medicare Mental Health Fraud Scheme

WASHINGTON – An assistant administrator of a Houston hospital was arrested today on charges related to his alleged participation in a $116 million Medicare fraud scheme involving false claims for mental health treatment, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

An indictment filed in the Southern District of Texas and unsealed today charges Mohammed Khan, 62, of Houston, with one count of conspiracy to commit health care fraud, one count of conspiracy to pay and receive illegal health care kickbacks and five counts of paying or offering to pay health care kickbacks.  Khan is expected to make his initial appearance in federal court today in Houston. 

“The indictment against Mr. Kahn alleges that he used his position as a hospital assistant administrator to submit millions in false claims to the Medicare program,” said Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.   “According to the charges, he paid kickbacks to patient recruiters, owners of group homes and assisted living facilities, and beneficiaries so that he could fill his hospital with patients for whom he could bill the government for medically unnecessary services or services that were never provided.   We will continue aggressively to pursue individuals who attempt to enrich themselves at the expense of the Medicare program.”

“The defendant charged in this indictment is accused of stealing precious Medicare resources by billing for services that were medically unnecessary or never provided," said Special Agent in Charge Stephen L. Morris of the FBI’s Houston Field Office.  “Our health care fraud efforts have never been more collaborative and aggressive. We will continue to work with our law enforcement partners to protect patients and fight against health care fraud.”

According to the indictment, Khan, as the assistant administrator of a Houston hospital, allegedly operated a scheme to defraud Medicare beginning in 2008 and continuing until his arrest today.  Khan allegedly caused the submission of false and fraudulent claims for partial hospitalization program (PHP) services to Medicare through the hospital.  A PHP is a form of intensive outpatient treatment for severe mental illness.   

The indictment alleges that Khan paid kickbacks to owners and operators of group care homes and assisted living facilities and to patient recruiters in exchange for delivering ineligible Medicare beneficiaries to the hospital’s PHPs.  The indictment alleges that Khan also paid kickbacks to Medicare beneficiaries who attended the hospital’s PHPs.   These kickbacks included cigarettes, food and coupons redeemable for items available at the hospital’s “country stores.”   Khan and his co-conspirators submitted or caused to be submitted approximately $116 million in claims to Medicare for PHP services purportedly provided by the hospital to the recruited beneficiaries, when in fact, the PHP services were medically unnecessary or never provided.  
M Khan Indictment (S.D. Tex.)

Monday, February 13, 2012

14 hospitals to pay $12 million for FCA violations

From the DoJ:

Fourteen hospitals located in New York, Mississippi, North Carolina, Washington, Indiana, Missouri and Florida have agreed to pay the United States a total of more than $12 million to settle allegations that the health care facilities submitted false claims to Medicare, the Justice Department announced today.

Click here for more. 

Here is a chart from FierceHealthcare:


Plainview (N.Y.) Hospital
$2.3 million
North Shore Syosset (N.Y.) Hospital
North Mississippi Medical Center in Tupelo, Miss.
$1.9 million
Mission Hospital in Asheville, N.C.
$1.5 million
Wenatchee (Wash.) Valley Medical Center
$1.2 million
Community Hospital Anderson (Ind.)
St. John's Mercy Hospital in Creve Coeur, Mo.
Gulf Coast Hospital in Fort Myers, Fla.
Lee Memorial Hospital in Fort Myers, Fla.
Cape Coral Hospital in Cape Coral, Fla.
Florida Hospital Orlando
$3.9 million
Florida Hospital-Oceanside
Florida Hospital Fish Memorial
Florida Hospital Heartland Medical Center

Sunday, February 12, 2012

Upcoming Pharmalot Webcast -- Shedding Light on the Sunshie Act

Pharmalot does a great job with its Webcasts.  See the description below for its upcoming Webcast scheduled for Leap Year.  Click here to register.
Finally, the long anticipated draft rules of the Patient Protection and Affordable Care Act, otherwise known as the Sunshine Act, were released by the Centers for Medicare & Medicaid Services. And there were some surprises. How will this affect your organization? How will your compliance have to change? How will this alter your Travel and Expense management? And what are some of the changes that key stakeholders have proposed?

Uncover the key points at a webinar where you will…
  • Learn who are "applicable manufacturers" and "covered recipients" 
  • Be able to distinguish which drugs, devices, biologicals, and medical supplies are covered by the law
  • Understand what details are required for each report & procedures for report submission and correction
  • Appreciate the unique requirements for clinical trial expenditures, including "direct" and "indirect" research payments, and criteria for delayed release of such payment data on the internet
  • Explain what penalties exist for failure to comply
CMS published the proposed rules on Dec. 19, 2011, with the comment period closing on Feb. 17, 2012.  The proposed rule is below.  Click here for an analysis by Skadden.

Saturday, February 11, 2012

Professor Mike Koehler -- FCPA Expert

Meet Professor Mike Koehler and subscribe to his blogs.

Professor Mike Koehler is a leading expert on the FCPA and other anti-corruption laws and initiatives. Professor Koehler has testified before Congress on the FCPA and he is also a frequent speaker before business and academic audiences.  Leading law reviews and journals have published Professor Koehler’s scholarship and he is a frequent featured source on the FCPA and related topics in various media including the Wall Street Journal, New York Times, Washington Post, The Economist, Reuters, Time, CNN, BBC, and Al Jazerra.Professor Koehler’s expertise and views are informed by a decade of FCPA practice experience at a leading international law firm during which he conducted FCPA investigations around the world, negotiated resolutions to FCPA enforcement actions with government enforcement agencies, and advised clients on FCPA compliance and risk assessment.

His blogs are:

Click here for a link to his scholarship.

Penis Pump Fraudster gets hard time

Just when I thought I've seen it all, now comes penis pump Medicare fraud.  From the AP:
An Illinois man was sentenced Friday by a federal judge in Rhode Island to more than three years in prison for shipping unwanted penis enlargers to diabetes patients as part of a larger fraud scheme that prosecutors say bilked $2.2 million from Medicare over four years.
Gary Winner, 50, of Wheeling, Ill., must also forfeit more than $2.2 million that prosecutors say Medicare lost because of the plot.
Diabetes patients received the penis enlargers repackaged in clear plastic bags with an information sheet claiming "regular use" increases blood flow in the urinary tract and prostate. Winner then charged Medicare an average of $284 each for a total of $370,305, authorities said.
In charging Medicare, Winner claimed the devices treated erectile dysfunction, prosecutors said. Medicare reimburses for products treating organic impotence and erectile dysfunction and requires the devices be "medically necessary" and prescribed by a physician. The erectile pumps shipped by Winner served "no medical purpose," prosecutors said.
Here is the Sentencing Memorandum filed by DoJ:
USA v. Winner (Sentencing Memo)

Friday, February 10, 2012

Update on HB 300 -- an attempt to reign in Texas Dental Medicaid Fraud

Click here for a link to the history of Texas House Bill 300 -- an attempt to reign in Texas orthodontic Medicaid fraud.  I was unaware that the Bill became effective on Sep. 1, 2011. 

Thursday, February 9, 2012

Tex. HB 300 - an attempt to crack down on Dental and Ortho Medicaid Fraud

Texas officials have realized that it has a huge dental and orthodontal Medicaid fraud problem -- to the tune of hundreds of millions of dollars per year.  In response to Frew v. Suehs, the 2007 Legislature appropriated $1.8 billion to expand access to preventative services in children’s Medicaid including medical and dental checkups and service. 

However, hundreds of crooked Texas dentists and orthodontists have used that pot of money as their personal ATM machine to fund their lavish lifestyles (jets, mansions, and jewels). 

Who pays for this fraud?  Taxpayers, honest dentists, and, most of all, kids. 

Read the report, starting at page 26.  
Healthcare Trans From at Ion Waiver

Wednesday, February 8, 2012

Crooked Teeth - Medicaid Millions

It's good to see solid investigative reporting.  Check out this story by Byron Harris and WFAA.  

Tuesday, February 7, 2012

More on the Texas Medicaid braces scandal

Here is another story by Byron Harris and WFAA in Dallas about the alleged abuse of the Medicaid program by dentists and orthodontists.

Monday, February 6, 2012

More Texas Medicaid Dental Fraud -- looks like orthodontists are getting in on the scam

"Last year, Texas taxpayers paid for braces for more than 120,000 children under Medicaid. The total bill was more than $184 million, which was far more than the next 10 states combined.  A News 8 investigation found that Navarro Orthodontix, which controls 11 clinics across the state, was paid more than $22 million in Medicaid last year. That's more than the entire state of California, which paid out $19.4 million."

Check out this story by Byron Harris and WFAA in Dallas.