By Christopher P. Young, Editor, G2 Compliance Advisor
Investigators used cell phone location data in over 800 instances to prove that a physician was not present at El Centro Clinic at the time certain tests were administered, as is required by Medicare regulations. Gevorg “George” Kupelian was sentenced to 30 months in custody and ordered to repay Medicare $964,011 after admitting that he set up the southern California clinic for the purpose of defrauding Medicare. Kupelian admitted to recruiting seniors for the use of their Medicare numbers and then using those numbers to submit claims to Medicare for unnecessary tests or tests that were never performed. The scheme generated approximately $1.3 million in Medicare reimbursements.
According to a press release by the U.S. Attorney’s office, San Diego Division, Kupelian recruited a physician to act as a front and provide a Medicare provider number needed to get claims paid by Medicare for the unnecessary services, including laboratory testing. Kupelian also hired an unlicensed person to act as a physician assistant.
The release further explains that Kupelian recruited patients to the clinic with the lure of a free buffet lunch and/or shoes in exchange for their Medicare numbers and willingness to submit to a pre-determined battery of tests that had no relationship to their medical condition. He also admitted to creating a cheat sheet laboratory requisition with certain tests and diagnoses checked and instructing employees to duplicate the requisition for all patients who visited the clinic. Kupelian then inserted fake results for the test to make it appear that they had been properly performed when they had not.
This case demonstrates the opportunity for fraud and abuse of the Medicare program that is provided by the in office ancillary services exception to the Stark law. The Stark law prohibits a physician from referring certain ancillary services such as laboratory testing to entities they own, in other words, self-referrals. The exception allows physicians to circumvent that prohibition as long as the services are performed in the physician’s office.