Crime Does Not Pay–especially when defrauding Medicare of nearly $1 billion

Ocean’s 11 (or 13) It Ain’t. Back in October, the Department of Justice (DOJ) and other Federal agencies had what was dubbed the  National Health Care Fraud and Opioid Takedown. Many of the takedownees were ‘telemedicine’ fraudsters. Of the over $6 bn of fraud identified, $4.5 bn was specified as relating to ‘telemedicine’ with more than 86 criminal defendants located in 19 judicial districts [TTA 2 Oct 20].

The sentences are now rolling in for this and earlier actions. Becker’s seems to be the only outlet tallying those who will be fined and having a stay in Club Fed. The three ‘telemedicine’ convictions noted by this Editor to date, totaling $958 million, are:

  • Genetic testing fraud: The owner of Scott Global, an Orlando telemarketing call center, was convicted of eight counts and a $2.8 million fraud. Telemarketers would call Medicare beneficiaries soliciting their information for expensive cancer screening genetic testing, or CGx, telling them that it would be covered by Medicare. Mr. Scott then paid bribes and kickbacks to ‘telemedicine’ companies to get physician’s orders authorizing the tests. Becker’s Healthcare 12 Jan   DOJ release
  • Pharmacy fraud: Larry Smith, a Florida resident owner of two pharmacies and a related company, defrauded pharmacy benefit managers of $931.4 million by submitting bills for fraudulent prescriptions purchased from a telemarketing company. The telemarketers improperly solicited patient information, then got approvals from ‘telemedicine’ prescribers, and finally sold the prescriptions to pharmacies like Mr. Smith’s for a kickback. Mr. Smith faces up to 10 years in prison.

In a 2018 related action, HealthRight, a ‘telemedicine’ company, and its CEO Scott Roix pleaded guilty to conspiracy to commit healthcare fraud for their roles in the scheme, agreed to pay $5 million in restitution. Sentencing is scheduled for 25 October. Mihir Taneja, Arun Kapoor, Maikel Bolos, and Sterling-Knight Pharmaceuticals also pleaded guilty in December 2020, according to the Justice Department. Becker’s Healthcare 26 Jan   DOJ release

  • The absence of telemedicine–prescribing medication without a patient consult–was what landed New Jersey physician Bernard Ogon, MD, to 33 months in prison, pay restitution of $24.3 million, and forfeit an additional $75,000. He signed preprinted prescriptions and then sent them to specific compounding pharmacies involved in the conspiracy. Becker’s Healthcare 28 Jan  DOJ release

Certainly more to come. This Editor has also checked for any further actions in Humana’s suit against telehealth/telemarketing company QuivvyTech as reported last August, and there are none. Our original report here.

QuivvyTech: a ‘telehealth’ company, sued by Humana in telemarketing scheme (US)

It was inevitable–the first alleged fraud and lawsuit involving a ‘telehealth’ company. The interestingly named QuivvyTech, which has styled itself as a telehealth company with “virtual care in general medicine, mental health, and complex care”, has been sued by insurance giant Humana. The grounds are that QuivvyTech telemarketers cold-called Humana members, who are generally members of Medicare plans, asked them about common ailments, and claimed they were working with Humana. They then recorded information that was sent to QuivvyTech physicians who would prescribe the members pricey and unnecessary creams (content undisclosed) fulfilled by co-conspirator pharmacies with QuivvyTech. The physicians listed in the suit electronically signed prescriptions for the members without reviewing patient history or having a prior relationship with the patient.

Humana not only is alleging harm in the payer-member relationship, but also lost millions in fraudulent claim payments for visits and medications. 

The lawsuit by Humana seeks treble damages, plus interest and fees, from QuivvyTech. It was filed in the US Southern District of Florida as many of the scammed members lived in Florida. QuivvyTech is based in Boca Raton.

Defendants in the suit include Frank Michelin, associated with QuivvyTech; Reliable Medical Supplies and Reliable Document Solutions, a telemedicine company with about 200 physicians; and physicians Jeffrey Mahon, MD, Elie Hercule, MD, Samuel Teniola, MD, Louis Mojicar, MD, Ananda De Silva, MD, and Jeffrey Stern, MD.

One wonders where QuivvyTech obtained Humana members’ phone numbers and information. 

QuivvyTech is still recruiting for physicians on job boards such as ZipRecruiter and StaffPhysicians.com. Becker’s Hospital Review, Healthcare Finance, Fierce Healthcare