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Southern District of Florida Unseals 38-Count Indictment for Healthcare Fraud

The 38-count indictment charged 20 individuals with various healthcare fraud, kickback and money laundering charges related to their alleged participation in a healthcare fraud scheme involving approximately $200 million in Medicare billing for mental health services. The defendants worked with and for American Therapeutic Corporation (ATC) and Medlink Professional Management Group Inc. allegedly submitting false claims for medically unnecessary services and services that were not actually rendered. The indictment alleges that kickbacks were paid to patient brokers and owners and operators of halfway houses and assisted living facilities, in exchange for delivering patients to ATC facilities. Notably, among those included in the indictment were not only physicians, but marketers who allegedly participated in the kickback operation. Moreover, the scheme also involved American Sleep Institute (ASI), in which the defendants allegedly paid additional kickbacks for patients to go to ASI.

In a statement by Daniel R. Levinson, the HHS Inspector General, “Community mental health centers are an essential element of the nation’s health care system and serve vulnerable populations…Today’s arrests by OIG agents and our law enforcement partners show that we will not tolerate criminals who pay kickbacks for referrals of Medicare business or who bill for services that were either medically unnecessary or never provided.” Furthermore, an FBI special agent stated that “Community Mental Health Centers can no longer use phantom medical care as a front to bilk Medicare for unnecessary or nonexistent medical services…The FBI and our law enforcement partners will investigate and criminally prosecute such fraud to the fullest extent of the law.”

While the healthcare community has grown accustomed to news of arrests pertaining to fraud in the durable medical equipment and home health agency fields, this case shows that no healthcare professional is immune from law enforcement investigation and prosecution. Law enforcement officials continue to investigate relationships between healthcare-related entities and bring charges demonstrating that compliance with federal and state fraud and abuse laws remains crucial for all healthcare entities.

For more information regarding government investigations and healthcare litigation, please contact Robert S. Iwrey, Esq. at (248) 996-8510 or (212) 734-0128, for more information regarding fraud and abuse, please contact Adrienne Dresevic, Esq. at (248) 996-8510 or (212) 734-0128, for more information regarding mental health centers, please contact Abby Pendleton, Esq. at (248) 996-8510 or (212) 734-0128, and for more information regarding sleep centers, please contact Daniel B. Brown, Esq. at (770) 804-6475 or visit the HLP website.

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