For the Sake of Ethics
by Sean Weiss, Partner & VP of Compliance
What direction does your Moral Compass point? For 25-years I have had the honor and privilege of working in a field that I love and am passionate about. I have seen lots of changes over the years and had opportunities to work with some amazing professionals. In life, just as in business, I strive for excellence because it is ingrained within my DNA. Part of the excellence I strive for is ensuring that my moral compass always points in the right direction; although sometimes it requires my wife to recalibrate it for me. The most favorite part of my job, simply because it is the most exciting, is being part of a defense team and putting the pieces of a complex puzzle together to vindicate and ensure a client Due Process. This, though, is not without significant challenges at times especially when the ones you are trying to defend cannot get out of their own way.
We are all human and as a result, we are flawed. However, the one area in which we should never be conflicted is in telling the truth and being forthcoming with information that is critical to mounting a suitable defense. No matter how many times I tell clients that telling the truth is always the best course of action especially if it was a mistake, they always seem to ignore that and believe that fabricating or exaggerating the truth will result in a better outcome. That could not be further from the truth. I’m a human BS detector as are a lot of professionals that conduct investigations. And through training and mostly experience in dealing with a variety of situations, I can always tell when someone is veering off course or being less than truthful about the events that transpired. What’s important to understand is that it’s not the mistake made that gets people in trouble; it’s the cover-up or attempt to cover-up that becomes the actual crime.
What I have found over my career in handling cases and having the privilege to work closely with members of OIG, DOJ, USAO, etc. is being forthcoming without giving away the farm or your strategies tends to work well if the opposing party believes you are working with them in “Good-Faith”. Prosecutors know when defense teams divulge certain information, maybe as part of a fishing expedition, to see if the prosecutors will bite and offer up a solution that is less intrusive. But that only happens when the prosecution believes there is a win in it for themselves as well. However, if the prosecution can prove the defense is lying or exaggerating the facts of a case, or even if it’s only their gut telling them something doesn’t feel right or add-up, then all bets are off.
I have worked with some of the best attorneys in the country when it comes to health care. I have unfortunately also had the displeasure of working with some really bad ones. Recently, I was asked to work on a case for someone who has become a good friend to me over the years. As he described the case to me, I told him it sounded very much like a case I was asked by him to work on more than a year ago. After conducting the employee interviews, I determined that it was not a case I could or should work on because I got this feeling that something just wasn’t right. My friend told me it was indeed the case I turned down but that he felt compelled to work on it and, unfortunately, almost everything he was told by one of the employees was completely fabricated and turns out she was the whistleblower. You may be asking how it is possible to be the person that creates the problem, lies about it, and then blows the whistle; and you would be well within your right to question the dysfunction of the legal system at times. Now, I find myself having to build a defense for my friend and, without a doubt, emotions are running high for me given the fact this case was a run-from type case from the onset. And because my friend felt compelled to protect the organization, he is now facing his own nightmare because the employee lied to him. There is something in the law called the “Unclean Hands” and you often will see this defense or what is referred to as an affirmative defense in Whistleblower Cases. The thing with this defense strategy is that there are variances between states and between Federal and State Law (Although there are a lot of similarities). For example: The California False Claims Act (like the federal FCA) does allow courts in rare circumstances to reduce a whistleblower’s reward (relator’s share) when he/she was instrumental in the fraudulent conduct. The California False Claims Act, Cal. Gov Code § 12652(g)(5), allows the court to reduce a qui tam plaintiff’s share of proceeds below the normal 15% minimum if that person “planned and initiated the violation.” In another case (Barajas) the qui tam plaintiff sued his employer for falsifying various performance tests on missiles (cruise) built to deliver nuclear warheads. The qui tam plaintiff was the principal tester and testified he falsified results for 4 years. He was specifically instructed to falsify one category of tests; however, he initiated falsification on his own for two other tests. As a result of the qui tam plaintiff’s active participation in the fraud, the court reduced his award to 10.8%, significantly below the 15% to 33% range. There is another case, United States ex rel. Marchese v. Cell Therapeutics Inc., 2008 U.S. Dist. LEXIS 97163 (W.D. Wash., Nov. 18, 2008), the qui tam plaintiff was directly involved in a scheme that fraudulently assured physicians that their medications were approved for various off-label applications and Medicare reimbursement. Although the qui tam plaintiff was involved in the fraud, the court determined that he was not an “initiator” or “planner” of the fraudulent scheme, and therefore did not reduce his share below the 15% statutory minimum. So, as you can see, there are different examples of how the application of the Unclean Hands is applied in cases.
I believe the vast majority of providers are good, honest and hardworking individuals. However, I know a lot of them like to skate the line and honestly, I get it (but I don’t condone it) because of how bad reimbursements have gotten and how unbearable some payers are with audits and failure to follow policy, etc. However, skating the line can be seen as potentially abusive, if not down-right an act of fraud. Even if it’s not proven in the end to violate the Health Care Fraud Statute the reputational damage, financial costs to defend yourself, and the headache with just going through the process should be enough to encourage providers to skate a little further away from the line. This is why compliance plans are so crucial, especially effective ones, because we establish Standard Operating Procedures (SOPs) to tell investigators how and why we do things the way we do. This helps codify the organization’s ethics and, hopefully, drive suspicion of wrong-doing down.
Here is just a sample of recent enforcement actions from OIG regarding bad behavior from the month of April alone. The full list can be found here: https://oig.hhs.gov/fraud/enforcement/criminal/index.asp.
April 18, 2019; U.S. Attorney; District of Nevada
Former Medical Doctor And His Business Partner Sentenced To Nearly Three Years In Prison For $7.1 Million Medicare Health Care Fraud Scheme
LAS VEGAS, Nev. – A former medical doctor and his business partner were sentenced Tuesday to 33 months in prison for their individual roles in a $7.1 million Medicare health care fraud scheme that occurred at three Las Vegas hospice and home healthcare agencies, announced U.S. Attorney Nicholas A. Trutanich for the District of Nevada.
April 17, 2019; U.S. Department of Justice
Appalachian Regional Prescription Opioid (ARPO) Strike Force Takedown Results in Charges Against 60 Individuals, Including 53 Medical Professionals
Charges Involve Over 350 Thousand Prescriptions for Controlled Substances and Over 32 Million Pills; ARPO Strike Force Grows to 10 Districts, Expanding to Include the Western District of Virginia
Attorney General William P. Barr and Department of Health and Human Services (HHS) Secretary Alex M. Azar II, together with multiple law enforcement partners, today announced enforcement actions involving 60 charged defendants across 11 federal districts, including 31 doctors, seven pharmacists, eight nurse practitioners, and seven other licensed medical professionals, for their alleged participation in the illegal prescribing and distributing of opioids and other dangerous narcotics and for health care fraud schemes. In addition, HHS announced today that since June 2018, it has excluded over 2,000 individuals from participation in Medicare, Medicaid and all other Federal health care programs, which includes more than 650 providers excluded for conduct related to opioid diversion and abuse. Since July 2017, DEA has issued 31 immediate suspension orders, 129 orders to show cause, and received 1,386 surrenders for cause nationwide for violations of the Controlled Substances Act.
April 12, 2019; U.S. Department of Justice
Medicare Advantage Provider to Pay $30 Million to Settle Alleged Overpayment of Medicare Advantage Funds
Sutter Health LLC, a California-based healthcare services provider, and several affiliated entities, Sutter East Bay Medical Foundation, Sutter Pacific Medical Foundation, Sutter Gould Medical Foundation, and Sutter Medical Foundation, have agreed to pay $30 million to resolve allegations that the affiliated entities submitted inaccurate information about the health status of beneficiaries enrolled in Medicare Advantage Plans, which resulted in the plans and providers being overpaid, the Justice Department announced today. Sutter Health is headquartered in Sacramento, California.
April 9, 2019; U.S. Attorney; District of New Jersey
Seven People Charged In New Jersey Massive Health Care Fraud Scheme Involving Telemedicine And Durable Medical Equipment (DME)
NEWARK, N.J. – One of the largest health care fraud schemes investigated by the FBI and the U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG) and prosecuted by the Department of Justice resulted in charges against 24 defendants – seven of whom were charged in the District of New Jersey – including the CEOs, COOs and others associated with five telemedicine companies, the owners of dozens of durable medical equipment (DME) companies and three licensed medical professionals, for their alleged participation in health care fraud schemes involving more than $1.2 billion in loss, as well as the execution of over 80 search warrants in 17 federal districts. In addition, the Center for Medicare Services, Center for Program Integrity (CMS/CPI) announced today that it took adverse administrative action against 130 DME companies that had submitted over $1.7 billion in claims and were paid over $900 million.
April 5, 2019; U.S. Department of Justice
South Florida Health Care Facility Owner Convicted for Role in Largest Health Care Fraud Scheme Ever Charged by The Department of Justice, Involving $1.3 Billion in Fraudulent Claims
A federal jury found a South Florida health care facility owner guilty today for his role in the largest health care fraud scheme ever charged by the Justice Department, involving over $1.3 billion in fraudulent claims to Medicare and Medicaid for services that were not provided, were not medically necessary or were procured through the payment of kickbacks.
April 2, 2019; U.S. Department of Justice
Dallas-Area Home Health Care Employee Sentenced to Five Years in Prison for His Role in a $3.7 Million Health Care Fraud Scheme
A Collin County, Texas man was sentenced to 60 months in prison today following his trial conviction for conspiracy to commit health care fraud.
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