Mealey's Insurance Fraud
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April 06, 2020
Insurance Fraud Defendant Given Compassionate Release Due To COVID-19 Pandemic
NEW YORK — A federal judge in New York on April 2 ruled that a 65-year-old man who has already served just over three years of a six-year prison sentence for his role in an insurance fraud scheme can serve the remainder of his prison term in his home with his wife, finding that his age and underlying medical conditions, which include end-stage liver disease and diabetes, warrant compassionate release in light of the COVID-19 pandemic (United States v. Mark Resnick, No. 12-cr-00152-CM, S.D. N.Y., 2020 U.S. Dist. LEXIS 59091).
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April 06, 2020
Doctor’s Motion To Stay Insurers’ Billing Suit During Criminal Proceedings Denied
DALLAS — A doctor’s emergency motion to stay proceedings in a civil lawsuit brought by insurance companies accusing him and shell companies he created of submitting bills for unnecessary services provided to beneficiaries was denied April 2 by a federal judge in Texas because the overlap between the proceedings would not adversely affect the defendant’s rights under the Fifth Amendment to the U.S. Constitution (Cigna Healthcare of Texas Inc., et al. v. VCare Health Sevices PLLC, et al., No. 20-CV-0077-D, N.D. Texas, 2020 U.S. Dist. LEXIS 58004).
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April 06, 2020
Georgia Man Charged With Health Care Fraud Over COVID-19 Testing Scheme
TRENTON, N.J. — The U.S. Department of Justice on March 30 announced that a Georgia man had been charged March 26 in federal court in New Jersey for his involvement in schemes that involved him soliciting and receiving kickbacks from companies that conduct genetic testing that was billed to Medicare and for receiving kickbacks for COVID-19 and respiratory pathogen panel (RPP) testing (United States v. Erik Santos, No. 20-9096, D. N.J.).
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March 25, 2020
Health Plans Sue Walgreens, Say Pharmacy Submitted Claims For Overpriced Drugs
CHICAGO — Three health plans sued Walgreens Co. and Walgreens Boots Alliance Inc. in federal court in Illinois March 23, claiming that the nation’s largest drugstore engaged in fraud by submitting bills that inflated the prices for prescription drugs at prices the insureds would have paid if they did not have coverage (Healthnow New York Inc., et al. v. Walgreens Co., et al., No. 20-cv-01929, N.D. Ill.).
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March 24, 2020
9th Circuit Revives Suit Saying Hospital Unnecessarily Admitted Elderly Patients
PASADENA, Calif. — A Ninth Circuit U.S. Court of Appeals panel on March 23 reversed a ruling dismissing a woman’s False Claims Act (FCA) suit accusing a hospital of admitting elderly patients from skilled nursing facilities for medically unnecessary in-patient care to submit false bills to Medicare, finding that she was not required to plead that the doctor’s opinions to admit the patients were “objectively false” (United States ex rel. Jane Winter v. Gardens Regional Hospital and Medical Center Inc., et al., No. 18-55020, 9th Cir., 2020 U.S. App. LEXIS 8986).
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March 18, 2020
Texas Federal Judge Strikes Expert Testimony Before COVID Order Takes Effect
HOUSTON — A Texas federal judge on March 13 excluded an expert’s opinion that a doctor accused of Medicare fraud suffers from autism in a final ruling before the criminal case was put on hold by a court order deferring jury trials because of the COVID-19 outbreak (United States v. Huan Doan Ngo, No. 4:17-cr-413, S.D. Texas, 2020 U.S. Dist. LEXIS 44459).
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March 18, 2020
Jury Finds Trio Defrauded Medicare Of $10.8M Through Fraudulent Cost Reports
GULFPORT, Miss. — A federal jury in Mississippi on March 13 found three individuals, a critical access hospital and a management company guilty of violating the False Claims Act (FCA) when submitting fraudulent cost reports from 2004 through 2015 that resulted in Medicare suffering $10.8 million in damages (United States ex rel. James Aldridge v. Corporate Management Inc., et al., No. 16cv369-HTW-LRA, S.D. Miss.).
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March 18, 2020
Dermatologist Agrees To Pay $1.7M To Resolve False Claims Act Suit
OCALA, Fla. — A dermatologist and a clinic on March 13 entered into an agreement with the federal government and two relators in federal court in Florida in which they agreed to pay $1.7 million to resolve allegations that they violated the False Claims Act (FCA) when submitting inflated claims to Medicare for wound repairs to obtain a greater amount of reimbursement (United States, ex rel. Robert Green, et al. v. Thi Thien Nguyen Tran, No. 15-cv-60, M.D. Fla.).
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March 18, 2020
State Farm: Fraud Defendants’ Arguments For Dismissal Are Premature
NEW YORK — State Farm Mutual Automobile Insurance Co. and State Farm Fire & Casualty Co. argue in a March 13 brief filed in federal court in New York that arguments from defendants seeking dismissal of the insurers’ lawsuit accusing them of submitting false claims for treatment under the state’s no-fault law are premature because they are fact-intensive and based on affidavits that were submitted along with the defendants’ motions to dismiss (State Farm Mutual Automobile Insurance Co., et al. v. Francoise Jules Parisien M.D., et al., No. 18-cv-00289-ILG-ST, E.D. N.Y.).
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March 18, 2020
Judge Refuses To Vacate Man’s Fraud Sentence Over Restitution Amount
ST. LOUIS — A federal judge in Missouri on March 2 denied a man’s motion to vacate a 51-month prison sentence and order requiring him to pay $2.2 million in restitution after he pleaded guilty to one count of health care fraud for organizing a scheme that involved the submission of bills to Medicare for medically unnecessary ankle-foot orthotics for elderly patients, holding that his counsel did not act ineffectively when negotiating the restitution amount (Donald Brian Havey v. United States, No. 17-CV-00852 JAR, E.D. Mo., 2020 U.S. Dist. LEXIS 35304).
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March 18, 2020
Judge Gives Relator Share Of Proceeds Of Government’s Recovery From Auditors
LAS VEGAS — A federal judge in Nevada ruled March 4 that a relator in a lawsuit brought under the qui tam provisions of the False Claims Act (FCA) can have 29 percent, or slightly more than $1 million, from proceeds the government obtained following an audit performed on health care facilities accused of fraudulently billing Medicare, finding that the proceeds were an alternate remedy that she could have pursued as part of her lawsuit (United States, ex rel. Cecilia Guardiola v. Renown Health, et al., No. 12-cv-00295, D. Nev., 2020 U.S. Dist. LEXIS 37815).
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March 17, 2020
7th Circuit Panel Vacates $1.8M Restitution Order Against Fraud Defendant
CHICAGO — A Seventh Circuit U.S. Court of Appeals panel on March 13 affirmed a man’s six-year prison sentence for violating the Racketeer Influenced and Corrupt Organizations Act (RICO) and interstate transportation of stolen property for his role in a scheme that partially involved defrauding insurance companies but overturned a $1.8 million order of restitution, finding that the judge failed to adequately demarcate the scheme (United States v. Hamza Dridi, No. 18-3334, 7th Cir., 2020 U.S. App. LEXIS 8020).
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March 13, 2020
Ohio High Court Majority Says Resentencing Did Not Doubly Punish Fraud Defendant
COLUMBUS, Ohio — A 5-2 Ohio Supreme Court on March 9 found that a trial court judge did not err when resentencing a woman who was found guilty on counts of insurance fraud, making false alarm and engaging in a pattern of corrupt activity, holding that she should not have had an expectation of finality in her sentencing during the direct appeals process and because the trial court could resentence her de novo (State v. Eva Christian, No. 2017-1691, Ohio Sup., 2020 Ohio LEXIS 599).
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March 11, 2020
Ohio Panel: Cocaine Dealer Was Complicit With Filing Of False Insurance Claim
WARREN, Ohio — An Ohio appeals court panel on March 9 affirmed a cocaine dealer’s conviction for one count of complicity in the commission of insurance fraud, finding that while there was no evidence that he was involved in the actual submission of the fraudulent claim, there was sufficient evidence that he supported, assisted and cooperated with the scheme to steal a woman’s personal property so she could file a claim with her insurance company (State v. Todd Masters II, No. 2019-L-037, Ohio App., 11th Dist., Lake Co., 2020 Ohio App. LEXIS 789).
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March 06, 2020
Cardiologist’s Fraud Conviction Overturned By 6th Circuit Over Withheld Document
CINCINNATI — A Sixth Circuit U.S. Court of Appeals panel on March 5 overturned a cardiologist’s conviction and sentencing for health care fraud for allegedly implanting medically unnecessary stents in patients with minimal arterial blockages, finding that the government’s failure to provide the defendant with a copy of a letter containing the results of an independent review paid for by a hospital where the procedures were performed violated the doctor’s right to due process under the Fifth Amendment to the U.S. Constitution (United States v. Richard E Paulus M.D., No. 19-5532, 6th Cir., 2020 U.S. App. LEXIS 6929).
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March 02, 2020
Plaintiff’s Expert Allowed To Opine On Cause Of Home Fire In Coverage Suit
MACON, Ga. — A certified fire investigator can testify as an expert for a mobile-home owner about the lack of evidence of arson at his home after it was destroyed in a 2016 blaze, a Georgia federal judge ruled Feb. 26 in an insurance coverage dispute (David T. Dobbs, et al. v. Allstate Indemnity Company, No. 5:18-cv-00309, M.D. Ga., 2020 U.S. Dist. LEXIS 32518).
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March 02, 2020
2 Pharmacy Owners Sentenced To 12 Years’ Imprisonment For Fraudulent Claims
LOS ANGELES — A federal judge in California on Feb. 26 sentenced two pharmacy owners to 12 years in prison each, ordered them to each pay $11.8 million in restitution and ordered immediate partial restitution of $500,000 for fraudulently billing Medicare and private insurer Cigna for prescription medications from 2012 to 2015 (United States v. Aleksandr Suris, et al., No. 17cr420, C.D. Calif.).
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February 27, 2020
Government, AseraCare Resolve False Claims Suit Over Terminal Illness Diagnoses
BIRMINGHAM, Ala. — The federal government and AseraCare Inc. on Feb. 26 stipulated to dismiss a False Claims Act (FCA) lawsuit filed in Alabama federal court that accused the hospice facilities owner of submitting fraudulent claims to Medicare for treatment of elderly patients who were improperly diagnosed as terminally ill after the parties announced that they had reached a settlement (United States v. AseraCare Inc., et al., No. 12-cv-0245, N.D. Ala.).
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February 25, 2020
GEICO’s Suit Against Clinics, Doctors Over Billing Survives Dismissal
NEWARK, N.J. — A federal judge in New Jersey on Feb. 24 refused to dismiss a lawsuit brought by the Government Employees Insurance Co. and three of its affiliates against three clinics and employees accused of submitting $2.7 million in fraudulent bills for no-fault personal injury protection (PIP) benefits between 2013 and 2019, finding that the insurer sufficiently alleged claims for violations of the New Jersey Insurance Fraud Prevention Act (IFPA) and Racketeer Influenced and Corrupt Organizations (RICO) Act, fraud and unjust enrichment (Government Employees Insurance Co., et al. v. Adams Chiropractic Center P.C., et al., No. 19-20633, D. N.J., 2020 U.S. Dist. LEXIS 30753).
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February 24, 2020
1st Circuit Panel Affirms Doctor’s Health Care Fraud Conviction
BOSTON — A First Circuit U.S. Court of Appeals panel on Feb. 20 upheld a doctor’s conviction on charges of making false statements in connection with health care benefits programs and conspiracy to make false statements, finding that a federal judge in Massachusetts did not err when denying the defendant’s motion to suppress e-mails that were obtained through a search warrant and when instructing the jury about a missing witness (United States v. Mousfafa Moataz Aboshady, No. 19-1232, 1st Cir., 2020 U.S. App. LEXIS 5198).