July 2023 Labs in Court
Recent cases involve COVID-19 fraud, UDTs, and the latest HIPAA Right of Access settlement.
Colorado Physician Gets Prison for COVID-19 Relief Fraud
Case: From March through June 2020, when COVID-19 was putting added financial pressure on many small healthcare providers, the supervisory physician of a Colorado medical clinic applied for and received $250,000 in federal emergency small business relief funds from the Accelerated and Advance Payment and Paycheck Protection programs. Rather than relaying it to the clinic, however, Dr. Francis F. Joseph, 58, used it for personal expenses. In January, a federal Colorado jury convicted Joseph of healthcare and wire fraud (while acquitting him on a charge of theft of government property related to a separate COVID-19 relief payment).1 On June 1, he received his sentence—two and a half years in prison.2
Significance: The expected crackdown against misusers of federal Coronavirus Aid, Relief, and Economic Security (CARES) Act COVID-19 relief funds has begun in earnest. As of early June, the Fraud Section of the U.S. Department of Justice’s (DOJ’s) Criminal Division has prosecuted more than 210 defendants in more than 140 criminal cases for CARES Act abuses, seizing more than $80 million in cash as well numerous real estate properties, cars, boats, and other luxury items purchased with the proceeds. In April, the DOJ enlisted the U.S. Department of Health and Human Services (HHS) Office of Inspector General’s participation in the campaign by launching the 2023 National COVID-19 Health Care Fraud Enforcement Action to target providers for CARES Act fraud, manufacture of counterfeit vaccination records, and false billing of over-the-counter COVID-19 testing kits.3
Georgia Pain Center, MD Owner Pay $625,000 to Settle Urine Drug Test & E&M Services False Billing Charges
Case: Georgia Pain Management, P.C., its physician owner, and ambulatory surgical center Samson Pain Center, P.C., have agreed to shell out $625,000 to settle claims of falsely billing Medicare and TRICARE for medically unnecessary urine drug screening tests (UDTs) and evaluation and management (E&M) services between May 1, 2015 and December 31, 2019. The government also claims that the pain clinic and its owner entered into an arrangement in which a reference lab paid the salary of a Georgia Pain employee in exchange for the physician owner’s referral of UDTs that weren’t medically necessary—a violation of the Anti-Kickback Statute. By subsequently billing the federal health programs for these illegally referred tests, the government alleges, they also violated the False Claims Act. The whistleblower who brought the original case will get $118,000 of the recovery.4
Significance: In general, you may not separately bill Medicare for E&M services provided on the same day as another medical procedure. However, E&M services provided on the same day can be billed using Modifier 25 if those services are:
- Significant,
- Separately identifiable from, and
- Above and beyond the usual preoperative and postoperative care associated with the medical procedure.
The government accused Georgia Pain of using Modifier 25 to “improperly unbundle” routine E&M services that weren’t separately billable from other minor surgical procedures performed on the same day.4
Unauthorized Disclosure of Defendant’s Confidential Information Costs Whistleblowers Their Qui Tam Lawsuit
Case: Medical device product engineers serving as expert witnesses in a pair of multistate lawsuits involving hip replacements filed their own qui tam lawsuit against their ex-employer, DePuy Orthopaedics, for allegedly running a hip replacement fraud scheme. The courts issued protective orders barring the relators from using any of the confidential product design information they received from DePuy as part of the qui tam case for the other lawsuits. When the relators violated the protective orders, the federal court granted a motion from DePuy to dismiss the qui tam lawsuit. The relators then appealed to the US Court of Appeals for the First Circuit, but to no avail.
Significance: The protective orders stated that, if the relators disclosed any of the protected information, they would bear the burden of proving that it had become public by the time of disclosure—a claim the relators made, but couldn’t prove. Disobeying a protective order qualifies as “extreme behavior” justifying dismissal, the court reasoned. Adding to the seriousness was the fact that the relators’ unauthorized disclosure of DePuy’s confidential information harmed the company and was part of a pattern of “repeatedly flouting court orders.” Accordingly, the appeals court concluded that the lower court didn’t abuse its discretion in dismissing their whistleblower case.5
OCR Maintains HIPAA Right of Access Crackdown
Case: The HHS Office for Civil Rights (OCR) is continuing to come after providers for failing to give patients timely access to their protected health information (PHI) under the Health Insurance Portability and Accountability Act (HIPAA) Privacy Rule. The latest case, announced on May 8, targets a Pittsburgh psychotherapy counselor who was fined $15,000 for not providing the medical records of three minor patients to the patients’ personal representative, their father.
Significance: This is the 44th HIPAA Right of Access settlement OCR has entered into since launching the initiative in April 2019. Seven of these settlements have been for $100,000 or more. In addition to the fines, many settling providers have had to agree to implement a HIPAA corrective action plan (CAP) that permits close monitoring by the OCR. These enforcement actions aren’t usually a surprise. When a patient files a complaint, the OCR’s first step is to intervene with the provider to resolve the situation; it’s only when the provider continues to deny access that the OCR takes enforcement action.6
OCR Right of Access Initiative Settlements Scorecard
| Provider | Settlement Amount | Allegations |
|---|---|---|
| Memorial Hermann Health System | $240,000 | Texas nonprofit health system’s billing department failed to provide patient complete medical and billing records despite five different requests |
| Banner Health ACE | $200,000 | OCR cites two occasions in which Phoenix-based not-for-profit health system took about six months to provide patients their requested PHI |
| Rainrock Treatment Center, LLC dba Monte Nido Rainrock | $160,000 | Florida eating treatment disorder center took more than eight months to fulfill patient’s request for a copy of her medical records |
| St. Joseph’s Hospital and Medical Center | $160,000 | Phoenix hospital refused to provide PHI to patient’s mother even though she was his legal representative |
| ACPM Podiatry | $100,000 | In response to initial complaint and OCR intervention, Illinois podiatry practice agreed to provide patient requested medical records but reneged despite patient’s multiple requests |
| Dr. Robert Glaser | $100,000 | New York cardiovascular disease and internal medicine doctor didn’t cooperate with OCR’s investigation or respond to its data requests after not providing patient a copy of their medical record |
| NY Spine Medicine | $100,000 | Neurology practice refused patient’s multiple requests for copies of specific diagnostic films |
| Bayfront Hospital | $85,000 | Florida hospital didn’t provide expectant mother timely access to the PHI of her unborn child |
| Korunda Medical | $85,000 | After first refusing to provide it at all, Florida primary care and interventional pain management services provider sent patient’s PHI to third party in the wrong format and charged him excessive fees |
| Great Expressions Dental Center of Georgia, P.C. | $80,000 | Georgia dental practice refused to give patient access to her record because she wouldn’t pay the $170 copying fee |
| Children’s Hospital & Medical Center | $80,000 | Nebraska hospital failed to provide mother of minor patient timely access to her daughter’s medical records despite repeated requests |
| Renown Health, P.C. | $75,000 | Nevada private, not-for-profit health system didn’t timely honor patient’s request to transfer her electronic health record (EHR) and billing records to a third party |
| Sharp Rees-Stealy Medical Centers | $70,000 | California hospital and healthcare network didn’t timely honor request to transfer patient’s EHR to a third party |
| Beth Israel Lahey Health Behavioral Services | $70,000 | Massachusetts provider ignored request of personal representative seeking access to her father’s PHI |
| Southwest Surgical Associates | $65,000 | Group practice in Greater Houston, Texas, area failed to provide patient timely access to their requested PHI |
| Arbour Hospital | $65,000 | Massachusetts mental health services provider kept patient waiting five months before granting access to his PHI |
| University of Cincinnati Medical Center, LLC | $65,000 | Ohio academic medical center failed to respond to patient’s request to send an electronic copy of her medical records maintained in its EHR to her lawyers |
| Hillcrest Nursing and Rehabilitation | $55,000 | Massachusetts rehab agency failed to provide an individual’s personal representative with timely access to her son’s medical records |
| MelroseWakefield Healthcare | $55,000 | Massachusetts provider didn’t furnish personal representative timely access to medical records under a durable power of attorney based on mistaken belief that the power of attorney didn’t permit provision of those records |
| Erie County Medical Center Corporation | $50,000 | Buffalo, New York hospital didn’t timely provide individual a complete copy of his medical records |
| Housing Works Inc. | $38,000 | New York City nonprofit services provider refused patient’s request for a copy of his medical records |
| Peter Wrobel, M.D., P.C., dba Elite Primary Care | $36,000 | Georgia primary care practice failed to provide patient access to his medical records |
| Advanced Spine & Pain Management | $32,150 | Ohio pain services provider took nearly four months to provide patient requested medical records |
| Family Dental Care, P.C. | $30,000 | Chicago dental practice took five months to provide former patient complete access to her medical records |
| Fallbrook Family Health Center | $30,000 | Nebraska provider failed to provide timely access to medical records |
| Dr. Donald Brockley, D.D.M | $30,000 | Pennsylvania solo practitioner dentist failed to provide a patient a copy of their medical record |
| Denver Retina Center | $30,000 | Colorado ophthalmological services provider took eight months to provide requested medical records and lacked compliant access policies |
| Village Plastic Surgery | $30,000 | New Jersey practice failed to provide patient timely access to his medical records |
| Jacob and Associates | $28,000 | Psychiatric practice with two offices in California failed to provide a patient requested access to her medical records, ignoring her annual requests for five years in a row |
| Paradise Family Dental | $25,000 | Las Vegas dental practice refused to provide mother copy of her and her minor child’s medical records |
| Riverside Psychiatric Medical Group | $25,000 | California medical group didn’t provide patient copy of her medical records despite repeated requests and OCR intervention |
| Associated Retina Specialists | $22,500 | New York provider didn’t give patient a copy of her medical records until three days after OCR initiated its investigation, nearly five months after the patient’s first written request |
| Health Specialists of Central Florida Inc. | $20,000 | Florida primary care practice didn’t provide personal representative/daughter timely access to father’s medical records despite multiple requests |
| Coastal Ear, Nose, and Throat | $20,000 | Ormond Beach, Florida practice didn’t provide patient timely access to medical records despite multiple requests |
| Life Hope Labs, LLC | $16,500 | Georgia lab took seven months to provide medical records to patient’s personal representative/daughter |
| David Mente, MA, LPC | $15,000 | Pittsburgh licensed psychotherapy provider didn’t provide medical records of minor patients to their personal representative/father |
| Dr. Rajendra Bhayani | $15,000 | New York physician didn’t provide patient her medical records even after OCR intervened and closed the complaint |
| All Inclusive Medical Services, Inc. | $15,000 | California multi-specialty family medicine clinic refused patient’s requests to inspect and receive a copy of her records |
| Wake Health Medical Group | $10,000 | North Carolina primary care provider never furnished requested records despite charging patient $25 access fee |
| Wise Psychiatry, PC | $10,000 | Colorado psychiatric firm refused to provide personal representative access to his minor son’s medical record |
| Lawrence Bell, Jr., D.D.S. | $5,000 | Baltimore, Maryland dental practice failed to provide timely access to a patient’s medical record |
| Diabetes, Endocrinology & Lipidology Center, Inc. | $5,000 | West Virginia diabetes clinic made the mother of a minor patient wait nearly two years for access to his medical records |
| King MD | $3,500 | Virginia psychiatric practice didn’t provide patient access to her medical records even after OCR intervened, provided technical assistance, and closed the complaint |
References:
- https://www.justice.gov/opa/pr/physician-convicted-misappropriating-approximately-250000-covid-19-relief-programs
- https://www.justice.gov/opa/pr/physician-sentenced-stealing-approximately-250k-covid-19-relief-programs
- https://oig.hhs.gov/newsroom/media-materials/2023-covid-takedown/
- https://www.justice.gov/usao-ndga/pr/woodstock-pain-management-doctor-and-clinics-pay-625000-resolve-false-claims-act
- https://www.ca1.uscourts.gov/content/22-1047p_6571457
- https://www.hhs.gov/about/news/2023/05/08/hhs-office-civil-rights-enters-settlement-resolving-potential-hipaa-violation-right-access-initiative.html
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