On October 18, 2022, the Department of Justice (DOJ) announced two settlements with CHC Holdings, LLC, an Oklahoma limited liability company doing business as Carter Healthcare (Carter), and two former senior corporate officers, resolving alleged violations of the federal False Claims Act (FCA), Anti-Kickback Statute (AKS), and Physician Self-Referral Law (commonly referred to as the “Stark Law”). One case settled claims that Carter had made improper payments to referring physicians in Oklahoma and Texas, while the other case settled claims that Carter had made false billing claims in Florida. Both matters were initiated by qui tam whistleblower complaints filed under the FCA. Carter agreed to pay more than $30 million to resolve the allegations.
Government Enforcement
Advisory Opinion 22-19: OIG Warns That Proposed Drug Cost Subsidization Arrangement May Warrant Sanctions
On October 5, 2022, the Office of Inspector General (OIG) published Advisory Opinion 22-19 (Advisory Opinion), in which it determined that a proposed oncology drug discount arrangement could constitute grounds for the imposition of sanctions under the federal anti-kickback statute (AKS). The OIG concluded that while beneficiary access to potentially life-saving medications is essential, the provisions of the proposed arrangement “would present more than a minimal risk of fraud and abuse” under the AKS.…
The DOJ Continues to Prosecute Providers for Fraudulent Telemarketing and Telehealth
A physician in Washington state pled guilty on September 28, 2022, to a criminal charge of conspiring to accept kickbacks related to fraudulent genetic testing. According to the Department of Justice (DOJ), the physician ordered certain genetic testing for Medicare beneficiaries that he was not treating and with whom a physician-patient relationship was not established as part of the scheme. According to the plea agreement accepted by the physician, the physician would be connected by telemarketers to the beneficiaries for a few minutes, the physician would order the diagnostic test, the labs would then bill for the test, and another company billed Medicare for the purported telemedicine visit. The physician received almost $168,000 in kickbacks for ordering the medically-unnecessary testing and other services, which resulted in over $18 million being paid by Medicare.…
DOJ Announces $900 Million Settlement Tied to Speaker Bureau Payments to Physicians
By Conor Duffy & Guest Contributor on
On September 26, 2022, the United States Department of Justice (DOJ) announced a $900 million settlement with pharmaceutical company Biogen Inc., which arose from alleged violations of the federal False Claims Act (FCA) and Anti-Kickback Statute (AKS) tied to payments from the company to physicians, which were allegedly intended to induce prescription of Biogen’s drugs. The matter initiated as a qui tam whistleblower complaint filed by an employee under the FCA.…
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Second Circuit Affirms HHS Rejection of Direct Copayment Assistance under Anti-kickback Statute
By Conor Duffy & Guest Contributor on
Below is an excerpt of a contributed article co-authored with Robinson+Cole Business Litigation Group lawyer Ben Daniels published in Physicians Practice on September 16, 2022.
On July 25, 2022, the U.S. Court of Appeals for the Second Circuit rejected an appeal brought by Pfizer, Inc. in a case that examines whether a “corrupt” intent is…
A COVID-19 Laboratory Testing Conviction under EKRA
Mark Schena, the President of Arrayit Corporation, has been found guilty by a jury for violations of the Eliminating Kickbacks in Recovery Act (EKRA), healthcare fraud, wire fraud, and securities fraud.…
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Advisory Opinion 22-16: OIG Declines to Impose Sanctions for Arrangement Involving Provision of Gift Cards to Patients for Completing Learning Program
On August 19, 2022, the Office of Inspector General (OIG) published Advisory Opinion 22-16 (Advisory Opinion) in which it declined to impose sanctions for an arrangement under which the requestor provides gift cards to patients for completing an online learning program related to surgeries. The OIG concluded that although the arrangement would constitute prohibited remuneration under the federal anti-kickback statute (AKS) and the beneficiary inducement prohibitions of the Civil Monetary Penalties Law (CMP), it is unlikely to impact competition among providers or influence selection of a particular provider and therefore determined that the arrangement did not warrant the imposition of sanctions.…
OIG Releases Data Brief on Medicare Telehealth Program Integrity Risks During the First Year of the Pandemic
The Department of Health and Human Services Office of Inspector General (OIG) recently released a Data Brief summarizing the findings of a review of program integrity risks related to telehealth services reimbursed by Medicare during the first year of the COVID-19 pandemic (the Pandemic).[1] The OIG analyzed Medicare and Medicare Advantage claims data from March 1, 2020, to February 28, 2021, focusing on providers that billed for telehealth services, with an emphasis on identifying providers that posed a high risk to the Medicare program.…
Suspect Characteristics Identified under a Telehealth Special Fraud Alert
HHS-OIG issued a new Special Fraud Alert on relationships with “purported telemedicine companies” on July 20, 2022. The Special Fraud Alert comes on the heels of a nationally coordinated takedown charging dozens of individuals criminally for their participation in an allegedly fraudulent scheme related to telemedicine, laboratories, and durable medical equipment (“DME”).[1] However, the alert comes after focus on telemedicine fraud cases in particular since 2019. The Special Fraud Alert identifies several characteristics of concern and common elements that individuals and companies should be aware of.…
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HHS Issues HIPAA Guidance to Support Audio-Only Telehealth Services
The Department of Health and Human Services (HHS) Office for Civil Rights (OCR) recently issued new guidance (Guidance) on the use of remote communication technologies to deliver audio-only telehealth in accordance with HIPAA. Per OCR, the Guidance is intended to ensure continued access for patients to audio-only telehealth in a secure and compliant manner, particularly once OCR’s notification of enforcement discretion (previously discussed here) tied to the COVID-19 pandemic is rescinded (i.e., once the HHS-declared COVID-19 public health emergency is ended).…
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