Private Duty Agencies in the Crosshairs of Fraud Enforcers

Dear friends,

The following article is about the consequences of fraud and abuse for
private duty agencies that accept any state or federal funds. Feel free to
share this information. If you decide to use this material, please include
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Elizabeth E. Hogue, Esq.

Office: (877) 871-4062

Fax: (877) 871-9739

Twitter: @HogueHomecare

Private Duty Agencies in the Crosshairs of Fraud Enforcers

Some owners, managers and staff members of private duty agencies still think
that fraud and abuse prohibitions apply only to Medicare certified home
health agencies. In fact, fraud and abuse prohibitions apply to private
duty agencies if they accept any state or federal funds, including, but not
limited to, Medicaid, Medicaid waiver, VA, and Tri-Care. Many private
insurers have adopted the prohibitions on fraud implemented by state and
federal programs.

In fact, private duty agencies are increasingly in the crosshairs of fraud
enforcers, especially if they receive reimbursement from Medicaid and/or
Medicaid Waiver Programs. The reason for enhanced scrutiny is that both the
federal government that partially funds state Medicaid and Medicaid Waiver
Programs and state governments that also fund these programs are alarmed
about the high costs of these Programs. Conventional wisdom says that there
are big bucks to be saved, if fraud and abuse in the Programs are controlled
and ultimately eliminated. Two recent cases illustrate these efforts to
control costs in Medicaid Programs:

In the District of Columbia, a married couple who owned a private duty
agency; Global Healthcare, Inc.; was involved in perpetrating $80 million in
Medicaid fraud as a provider of personal care services. The wife was not
entitled to take part in the Medicaid Program because she was excluded from
participation in the Medicare, Medicaid and all federal health care programs
due to the revocation of her nursing license. She fraudulently obtained a
Medicaid provider number by forging signatures on the application for the
provider number.

The couple billed the Medicaid Program for services not provided, recruited
others to assist them, including various family members, and created
fraudulent paperwork to hide the illegal activity. They falsified time
sheets, patient records and employment files, faked progress notes and
forged signatures on various records. Nine other individuals were also
charged. Two of them remain fugitives.

What were the consequences of their fraudulent activity? The wife was
sentenced to ten years in prison and the husband to seven years in prison.
Both prison terms will be followed by three years of supervised release.
The couple also forfeited over $11 million seized from 76 bank accounts,
their residence worth approximately $1 million, $73,000 in cash and five
luxury vehicles worth $400,000. The judge also imposed a forfeiture money
judgment of $39,989,956 on both defendants and restitution to the DC
Medicaid Program of $80,620,929.

In Louisiana, the owners and operators of Extraordinary Care Network, Inc.,
an attendant care services agency, were convicted of defrauding the
Louisiana Medicaid Program to the tune of millions of dollars. The owners
admitted that they submitted claims to the Medicaid Program, which falsely
represented that the Agency provided one-on-one attendant care when these
services were not, in fact, provided. The owners also admitted that they
fabricated progress notes, forged signatures of unwitting company employees
and then used these documents to support fraudulent claims to obtain
reimbursement from the Medicaid Program.

And the consequences for this couple? The wife was sentenced to 44 months
in prison and the husband was sentenced to 36 months in prison. The couple
was ordered to make restitution in the amount of $1,200,000 to the Medicaid
Program and to forfeit an additional $1,200,000. Both defendants will be
on supervised release for three years following their prison terms.


So, private duty providers, don't believe the myth that only Medicare
certified agencies are subject to fraud and abuse enforcement. The
consequences are devastating for you, too! Heads up!

C2016 Elizabeth E. Hogue, Esq. All rights reserved.

No portion of this material may be reproduced in any form without the
advance written permission of the author.
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