Health Care Fraud Sentences Handed Out To Miami HIV-Infusion Clinic Owners - Govt Used Undercover Cooperating Witnesses Recording Defendants

The government is resorting to more traditional law enforcement investigation methods in order to obtain hard evidence of payment of kickbacks, lack of medical necessity and other types of "health care fraud." In this recent case from Miami, it involved cooperating witnesses (working off their own legal problems) working undercover as marketers and recording their work at the clinic which included payment of kickbacks.

On January 26, 2010, in the Southern District of Florida, Lisset Lombera and Yamilet Cardenas of Miami-Dade County were sentenced after both having plead guilty in November 2009 for conspiring to commit health care fraud in violation of Title 18, United States Code, Section 1349.

In Miami, U.S. District Court Chief Judge Federica A. Moreno sentenced Ms. Lombera to 30 months’ imprisonment and three years’ supervised release; and sentenced Ms. Cardenas to 24 months’ imprisonment and three years’ supervised release. Chief Judge Moreno ordered both defendants to pay restitution of $254,469 to Medicare (the total amount received by the clinic). Both of the women were immediately remanded into custody to begin serving their sentences.

The allegations underlying the case were as follows. From February 2006 to December 2006, Ms. Lombera and Ms. Cardenas allegedly conspired with Dr. Alberto Gonzalez-Gomez and others to defraud Medicare through the submission of fraudulent claims from an HIV-clinic known as Medley Clinic. Medley Clinic submitted $3,018,400 in fraudulent Medicare claims and was reimbursed $254,469.

The government's case was built on undercover cooperating witnesses wearing recording devices. This is becoming more common in health care fraud cases. In 2006, two cooperating witnesses, posing as marketers or recruiters, brought individuals purporting to suffer from HIV-related ailments to the Medley Clinic in exchange for kickbacks from the Clinic. Ms. Lombera and Ms. Cardenas, who allegedly controlled Medley Clinic, instructed the individuals complete paperwork, fraudulently claiming that Medley provided them with expensive HIV-related drugs, when, in fact, in most cases, the drugs were neither provided nor medically necessary.

In July and August 2006, the cooperating witnesses wore hidden devices that recorded conversations with Ms. Lombera and Ms. Cardenas in which the defendants admitted being aware of the fraud.

The physician, Alberto Gonzalez-Gomez, was prosecuted separately and was sentenced to 24 months’ imprisonment.

Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at www.flsd.uscourts.gov or http://pacer.flsd.uscourts.gov.

Attorney Commentary: Health care providers who are generally honest and have no intent to commit any type of fraud need to be very careful in dealing with any marketers or patients or third parties. In this day of age when there are many cooperating witnesses working for a better sentence, you must assume that everyone is undercover and you are being recorded.

I have seen honest doctors who when facing financial pressure have a laboratory representative show up in their office offering to pay part of their overhead by paying rent or paying for a medical assistant -- and go along with it not realizing the ramifications of taking $600 a month.

If you are offered any type of arrangement that involves your receipt of any money or consideration for rent, payroll or other potentially legitimate reasons, run - do not walk - to your health care attorney and seek a consultation and legal opinion as to whether it is legal. There are certain occasions where payment of rent for space, for example, can be in a safe harbor but do not rely on your own judgment or the fact that "everyone else does it."

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green & Associates in Los Angeles, California focuses their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers and have handled hundreds of health care fraud cases. Their website is: http://www.greenassoc.com/

13 California Hospitals Fined For Medical Errors - Article From Los Angeles Times

For those health care providers who think that everyone leaves hospitals alone, here is an article from the Los Angeles Times.

I would like to see more balanced reporting from the L.A. Times on healthcare rather than a simple regurgitation of the government's press release. Compare the press release and the article and see if you can find any actual reporting.

What happens to these hospitals now? These facilities are required to implement a plan of correction to prevent future incidents. In addition, the hospitals can appeal an administrative penalty by requesting a hearing within 10 calendar days of notification. If a hearing is requested, the penalties are to be paid if upheld following appeal. Thus, the fact that the hospitals were assessed fines does not mean that they were properly assessed.

To view the article, go to:

13 California hospitals fined for medical errors - latimes.com

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Posted by health care attorney Tracy Green.

Los Angeles Doctor Convicted of Fraud for Performing Cosmetic Procedures that Were Billed to Patients’ Insurance Companies as ‘Medically Necessary’

On Thursday, January 21, 2010, Lawrence Saks of Rolling Hills, was found guilty Thursday afternoon of 16 federal charges for billing patients and then their insurance companies for procedures that included facelifts and tummy tucks. The trial was before Judge Consuelo Marshall. Lawrence Saks has lost his medical license. His first trial ended up in a mistrial where it was deadlocked 11-1 in favor of guilt.

Mr. Saks was a licensed physician at the time of the acts alleged. His medical license was revoked in California in 2008.

The federal court jury deliberated about four hours before finding Mr. Saks guilty of four counts of health care fraud, five counts of mail fraud, four counts of false statements relating to health care matters and three counts of aggravated identity theft for using the names of other doctors while submitting claims to insurance companies.

The former Dr. Saks operated Madison Park Cosmetic Surgery and Laser Center, which had offices in Torrance and San Pedro. Madison Park offered patients elective procedures like face lifts and tummy tucks. The evidence presented at trial showed that Mr. Saks collected payments from patients for elective procedures and then filed claims with their insurance companies stating they had medically necessary surgeries, such as tumor removals and hernia repairs. Mr. Saks collected approximately $5,900 in payments after submitting nearly $87,000 in fraudulent claims to the insurance companies.

As a result of the guilty verdicts, Mr. Saks faces a maximum statutory sentence of 166 years in prison when he is sentenced by Judge Marshall on March 29.

Mr. Saks has other legal troubles. He is also scheduled to go on trial on March 8 on charges of defrauding disability insurance companies that were allegedly paying him benefits after he told the insurers that he was not able to work. In addition, Mr. Saks had a prior tax related criminal conviction when he was charged and tried with the health care fraud counts.

The investigation into Mr. Saks was conducted by the Federal Bureau of Investigation and IRS-Criminal Investigation.

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green & Associates in Los Angeles, California focuses their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers. Their website is: http://www.greenassoc.com/

Health Care Fraud "Fugitive" Arrested In Mexico 6 Months After Being Indicted In Miami

Miami is keeping its title of city with the most health care fraud. Last week Jose Luis Perez, age 34, was located and arrested in Cancun, Mexico. Mr. Perez had been living in the Miami area at the time he was indicted on health care fraud charges -- but then traveled to Mexico. The government claims that on July 2, 2009, he "fled the country after learning he had been indicted and was going to be arrested."

Mr. Perez was indicted on June 30, 2009, along with co-defendant Reinaldo Guerra, on charges of conspiracy to commit Medicare fraud, Medicare fraud, and aggravated identity theft. An indictment contains allegations that a defendant has committed a crime. Every defendant, including Mr. Perez, is presumed innocent until and unless proven guilty.

According to the Indictment, the fraud involved durable medical equipment (DME), which is equipment that can be used in the home on a repeated basis for a medical purpose. Where DME is prescribed or ordered by a physician, an authorized Medicare provider who supplies the equipment to a Medicare beneficiary may be eligible for reimbursement by Medicare.

The Indictment charged that Mr. Perez and Mr. Guerra owned and operated 21 corporations that purported to supply DME to Medicare beneficiaries pursuant to physicians' prescriptions or written orders, using straw or nominee owners to disguise their control over the companies. They are accused of submitting approximately $179 million in fraudulent claims to Medicare for DME that had not been prescribed or ordered by a physician nor delivered to a Medicare beneficiary.

Based on those claims, it is alleged that Medicare paid the DME companies approximately $56 million. In addition to health care fraud, both Mr. Perez and Mr. Guerra were charged with aggravated identity theft for using physicians' Medicare identification numbers without the physicians' authorization.

Mr. Guerra has already been sentenced. He was sentenced on November 19, 2009 to 14 years' imprisonment, followed by three years of supervised release, and to pay $35 million in restitution to the Medicare program. Mr. Guerra was denied a bond after his arrest last July because he did not have proof of a steady job in years -- yet the government prosecutors claimed he managed to pay cash for a $349,000 home in Southwest Miami-Dade, traveled to Costa Rica 10 times and acquired a fleet of luxury cars, including Mercedes-Benz, BMW, Cadillac, Lexus, Acura and Lamborghini.

The arrest in Mexico happened after the FBI and HHS-OIG received information that Mr. Perez had traveled to Cancun, Mexico. This information was passed on to the FBI Legal Attaché Office in Mexico City, who confirmed Mr. Perez' identity and location. Instituto Nacional de Migracion, Mexico's Immigration Service, then arrested Mr. Perez without incident. Mr. Perez was brought back to Miami and is currently being held at the Federal Detention Center in Miami pending trial.

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green & Associates in Los Angeles, California focuses their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. She has handled hundreds of cases involving health care fraud. The firm website is: http://www.greenassoc.com/

California Court of Appeal Revives Suit Over Medical Group’s Internal Fight - Were Physicians Improperly Forced Out And Levied An Illegal Assessment?

A recent Court of Appeal decision (Dec. 2009) illustrates what happens when a group of doctors allege they were improperly forced out of their medical group. In such cases, early legal advice is essential since the corporate rules on who has standing to sue the corporation are complicated.

It is important for each shareholder to understand how to position themselves in the event of a legal battle. Some medical corporations are fun like fiefdoms with minority shareholders being deprived of their rights and earnings.

The case is Haro v. Ibarra, B213499. Although this is a technical legal discussion, it will assist shareholders in understanding how shareholder battles play out in the court system.

The plaintiffs in the case were physicians Carlos Haro, Carlos Meza, Marcos Lemor, Antonio Alarcon, Miguel Rodriguez and Jose Delgado. They claimed they were improperly forced out of their medical group and that an assessment of nearly $58,000 per share was illegal because it was not levied at a properly noticed meeting and because it was not levied on all shareholders.

The defendants include Fernando Ibarra, Alfonso Barragan, Manuel Figueroa, Maria Christina Hernandez and Omar Perez—all officers, directors and/or shareholders of AHP—as well as Alpha Medical Management, LLC, which manages AHP, and Medical Management Consultants LLC, which is the parent company of Alpha and is owned by Ibarra and Barragan.

Unfair Dealing Alleged

The plaintiffs allege that they collectively owned nearly 30 percent of AHP’s stock, that they had objected to what they believe was unfair dealing by Barragan and Ibarra—who owned one-third of AHP’s shares—and that Barragan and Ibarra had schemed to oust them from the corporation. To that end, they say, the pair declared Alarcon’s shares to be forfeited—without cause—and levied the assessment, warning the plaintiffs that they would be forced to sell their shares if they did not comply.

The stated purpose of the assessment, according to the pleading, was to fund the purchase of a medical practice in Mexico, which the plaintiffs alleged to be “a radical departure from the normal business of AHP.” They characterized the assessment as a violation of the corporation’s articles and bylaws, and as imprudent and fraudulent, and claimed that material information about the proposed acquisition was being withheld.

They also alleged derivative causes of action, charging that Ibarra and Barragan had damaged AHP through their control of its management company, and raised personal claims for conversion of their shares and for diminution of the value of the shares through manipulation of earnings and expenses.

Los Angeles Superior Court Judge Maureen Duffy-Lewis sustained demurrers to all causes of action, reasoning that since they no longer owned shares, the plaintiffs could not plead derivative claims, and that the remaining claims were barred by Corporations Code Section 423(m).

Statutory Language

The statute provides that “[n]o action shall be maintained to recover shares sold for delinquent assessments, upon the ground of irregularity in the assessment, irregularity or defect of the notice of sale, or defect or irregularity in the sale, unless the party seeking to maintain the action first pays or tenders to the corporation, or the party holding the shares sold, the sum for which the shares were sold, together with all subsequent assessments which may have been paid thereon and interest on such sums from the time they were paid.”

Justice Victoria G. Chaney, writing for the Court of Appeal, said that with respect to the personal causes of action, the plaintiffs adequately pled an exception to the statute by alleging that the assessment was void. Justice Chaney was very well respected when she was a trial court judge in Los Angeles County Superior Court and her opinions are very well drafted and reasoned. Apart from being a legal scholar she is also pragmatic and understands the real world.

Justice Chaney cited Herbert Kraft Co. Bank v. Bank of Orland (1901) 133 Cal. 64 and Cheney v. Canfield (1910) 158 Cal. 342 is the leading authorities to be addressed. Both of these are old cases.

In Kraft, the California Supreme Court held that Section 423(m)’s predecessor did not apply to a claim that the plaintiff’s stock in a bank was forfeited when he failed to pay an assessment that was not levied on any other stock. The justices reasoned that if the allegation was correct, the assessment was void, and thus the plaintiff did not have to pay it as a prerequisite to bringing the action.

Justice Chaney, similarly, declined to apply the statute to a claim that an assessment had been levied at a board meeting at which a quorum was not present.

Justice Chaney declined to limit Kraft to the situation in which forfeited shares are sold to the directors who caused the shares to be forfeited. That argument, she said, was based on an out-of-context reading of the case.

Derivative Causes

With respect to the derivative causes of action, Justice Chaney also concluded that it was error to sustain the demurrers. While the usual rule is that the plaintiff must own the shares continuously from the time the cause of action arises to the time it is adjudicated, there are equitable exceptions, she said, concluding:

“Appellants have alleged equitable considerations that warrant an exception to the continuous ownership requirement, such as the allegations in the [second amended complaint] that other shareholders were not required to pay the assessment and yet did not have their shares forfeited.”

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green & Associates in Los Angeles, California focus their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. Tracy Green is a well known health care attorney. She has been a physician attorney in hundreds of legal matters involving physician business disputes that are not malpractice related. The firm website is: http://www.greenassoc.com/

Los Angeles Families Sue Regional Center Over Discontinued Autism Therapy - latimes.com

Families sue over discontinued autism therapy - latimes.com

Services for children with autism is a topic important to me. The State's budget crisis has caused it to discontinue many therapies to children with autism on the ground that they "don't work." Many state providers will have problems with their clients getting funding. The entire health care industry in California will be feeling the pain caused by the State budget. Discontinuing services to these children is short-sighted. It will just cost the State more in the long run.

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New York Hospital Official Pleads Guilty To Conspiring To Rig Bids

On January 12, 2010, Freddy Deoliveira, a New York Presbyterian Hospital (NYPH) purchasing official pleaded guilty to conspiring to rig bids on re-insulation services contracts for the hospital.

Mr. Deoliveira, who held various supervisory positions at the NYPH, pleaded guilty in U.S. District Court in Manhattan. According to the charge, between approximately October 2000 and March 2005, Mr. Deoliveira conspired with others to create the appearance that contracts at NYPH were awarded in accordance with NYPH’s competitive bid policy, when, in fact, they were not.

Mr. Deoliveira admitted that he designated which company would submit the low bid on a contract, and which company or companies would submit higher, complementary bids, to ensure that his designated company would be awarded the contract. To create the illusion of a competitive bidding process, Mr. Deoliveira’s co-conspirators would use each other’s letterhead to submit the high, noncompetitive bids.

In exchange for awarding the contracts to the designated bidder, Mr. Deoliveira received cash kickbacks from his co-conspirators.

The bid rigging violation with which Mr. Deoliveira is charged carries a maximum penalty of 10 years in prison and a $1 million fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victim of the crime, if either of those amounts is greater than the statutory maximum fine.

To date, seven individuals and three companies have pleaded guilty to charges arising out of the same investigation.

Attorney Commentary: In many (most) countries of the world, "kickbacks" are routine, expected and legal, even if not quite ethical. In such countries, sellers know that they will make no sales or get business unless a portion of the price is kicked back to the buyer's agent or the person making the referral, and companies know that their employees and agents are soliciting and accepting kickbacks. In the United States, the rules are different.

Here is a quick summary of 5 types of kickbacks that are illegal in the United States in almost all circumstances.

(1) It is illegal to pay a kickback for the referral of a patient or for medical services (and for other professions such as legal services). It is also illegal to deduct these improper kickbacks for tax purposes.

(2) It is illegal to pay a kickback to obtain government contracts.

(3) It is illegal for a publicly traded company to pay kickbacks that are deducted for U.S. tax purposes. In practical effect, this means that publicly traded companies cannot legally pay kickbacks in foreign countries, even if kickbacks are legal and necessary in those foreign countries.

(4) It is illegal for an employer to accept kickbacks from employees. Although it is illegal, it is an unfortunate fact that many employees are forced to pay kickbacks to their bosses just to get and keep a job in the U.S.

(5) It is illegal for any public official to solicit or accept kickbacks and/or bribes.

For people who are employed by companies, accepting kickbacks can also be prosecuted as an embezzlement from the company. The theory is that the employee is taking a benefit that should belong to the company. For example, the employee could have negotiated a discount instead of keeping the kickback for himself or herself.

There are numerous referral arrangements in businesses (commissions, referral fees in certain private businesses) that are not illegal. In fact, there are some referral fees that could be immoral or civilly wrongful but are not illegal. It is important for any licensed professional or person who bills the government or insurance companies to seek a legal opinion on whether the referral fee is legal under governing statutes, rules and regulations.

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green & Associates in Los Angeles, California focuses their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. She has handled hundreds of cases involving payments of referral fees or kickbacks. The firm website is: http://www.greenassoc.com/

L.A. County District Attorney’s Office Is To Receive $17.2 Million In 3 Grants From Dept. Of Insurance To Combat Workers' Comp & Auto Fraud

A spokesperson for Supervisor Michael D. Antonovich said that the Board had unanimously approved the grants, totaling $17.2 million, to combat automobile insurance and workers’ compensation fraud.

According to the spokesperson, a $5.3 million grant will be given to the District Attorney’s office “to combat fraudulent claims that cost taxpayers millions of dollars annually and have led to thousands of jobs being lost due to local business closures precipitated by escalating workers’ compensation costs caused by fraud.”

The remaining two grants will focus on auto insurance fraud organizations and using the spokeperson's own words the “unscrupulous doctors, chiropractors, lawyers and others who profit from fraudulent automobile insurance claims.”

Attorney Commentary: The funding of these special units explains why there is an increased prosecution in these cases. The reason is that this is not County money but grants for specified funding and the grants require the monies be used for the specified purposes. We can therefore expect to see more investigations and prosecutions involving professionals in the personal injury and workers' compensation fields.

It is not specified but usually these grants are from the Department of Insurance who obtain the funds by assessment on insurance policies. Representatives of the insurance companies are often on the committees who decide which counties receive these grants and whether they will be awarded grants the following year.

In other words, representatives of the victims of these insurance crimes have a say in the prosecution of these cases and are able to fund the prosecutions. It is different than the way almost all other crimes are prosecuted.

Any questions or comments regarding this post or your own situation should be directed to: tgreen@greenassoc.com or 213-233-2260. Tracy Green is a principal at Green and Associates in Los Angeles, California and focuses her practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. She has significant experience in defending individuals, licensed professionals and businesses in insurance fraud investigations. The firm website is: http://www.greenassoc.com/

Criminal Prosecution For Auto Insurance Fraud Continued To Rise: 2 Recent Cases

Up until a few years ago, if someone had filed a false auto insurance claim claiming their car had been hit in an accident – all that usually would have happened is for the insurance claim to be denied. The matter was handled as a civil dispute between the auto owner and his or her insurance carrier except in extreme cases. Those days are over. In these post-Madoff days, any type of fraud is being investigated and prosecuted. Moreover it is being punished more harshly. As an insurance fraud attorney, I review recent cases to see the trends in prosecution and sentencing.

Two cases from Ventura County illustrate what can happen when people make false insurance claims when they are either under financial stress or find themselves uninsured. Like most criminal cases, only a small percentage of insurance fraud is discovered – but when it is discovered, it is being punished harshly to deter others. In both cases, the individuals charged were first-time offenders and ordered to serve jail time for both a misdemeanor and a felony plea (30 to 60 days).

1^st Case – Falsely Reporting That Accident Occurred On A Different Date To Obtain Insurance

On December 9, 2009, Lauro Aguilar-Martinez of Glendale, California was sentenced after pleading guilty to misdemeanor auto insurance fraud. The facts alleged were as follows. On June 13, 2009, Mr. Aguilar-Martinez rear-ended a vehicle on Interstate Highway 5 in Los Angeles. At the time, Mr. Aguilar-Martinez was not insured.

He decided to become insured. Thus, on June 19, 2009, he purchased auto insurance from Alliance United Insurance Company in Ventura. On June 23, 2009, Aguilar-Martinez contacted the Alliance United claims department and made a claim for the June 13 rear-end collision. However, he falsely reported that the collision occurred on June 23, 2009, after he was insured.

Mr. Aguilar-Martinez was placed on probation for three years and ordered to serve 30 days in the Ventura County jail.

The new aggressiveness in prosecution is also evidenced by the fact that in the first case, the accident at issue occurred in Los Angeles but the Los Angeles County resident purchased auto insurance from a company in Ventura County while allowed Venture to prosecute the case.

2^nd Case – False Report of Stolen Truck

Last month, on December 9, 2009, Hidalgo Lopez Gomez of Oxnard was sentenced to serve 60 days in the Ventura County jail after having pleaded guilty to felony auto insurance fraud. Mr. Gomez was placed on formal probation for three years and was ordered to pay Infinity Insurance $3,547 in restitution prior to his sentencing.

The facts in this case are as follows. On January 29, 2009, at 5:00 a.m., Mr. Lopez contacted the Oxnard Police Department and reported his 2008 Dodge truck was stolen after he went inside a market on Saviers Road. Mr. Lopez claimed he left his truck running as he went inside the market to buy coffee. When he returned outside, his truck was gone. Later that same day, Mr. Lopez contacted Infinity Insurance and made a claim for the theft.

Mr. Lopez's claim was assigned to Infinity's Special Investigations Unit (SIU). An SIU investigator made an inquiry with the Department of Homeland Security and learned the license plate readers at the San Ysidro border crossing recorded Lopez's truck traveling into Mexico at 3:37 a.m. on January 29, 2009. There was no record of the truck returning to the United States.

Since Mr. Lopez's account of how and when his vehicle was “stolen” did not add up, Infinity Insurance referred the case to the California Department of Insurance, Fraud Division. After additional investigation by fraud detectives, Mr. Lopez was subsequently arrested and charged with felony auto insurance fraud.

Any questions or comments regarding this post or your own situation should be directed to: tgreen@greenassoc.com or 213-233-2260. Tracy Green is a principal at Green and Associates in Los Angeles, California and focuses her practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. She has significant experience in defending individuals, licensed professionals and businesses in insurance fraud investigations. The firm website is: http://www.greenassoc.com/

Ex-UCLA Healthcare Employee Enters Conditional Guilty Plea to Four Misdemeanor Counts of Violating HIPAA By Reading Patient Records In Federal Court

On January 8, 2010, a former UCLA Healthcare System researcher, Huping Zhou, entered a conditional guilty plea to four misdemeanor counts of of violating the federal privacy provisions of the Health Insurance Portability and Accountability Act (HIPAA) by reading private and confidential medical records. Mr. Zhou is one of the first people in the nation to be convicted of violating the privacy provisions of HIPAA.

Mr. Zhou's plea came just before trial was scheduled to begin this week. The plea was before United States Magistrate Judge Andrew J. Wistrich. In the plea, Mr. Zhou specifically admitted to knowingly obtaining individually identifiable health information without a valid reason, medical or otherwise. However, the plea was conditional because Mr. Zhou reserves the right to argue that his case should have been dismissed and that he can withdraw his guilty plea in appeals on the ground that he did not know this was a federal crime.

Mr. Zhou, who is a licensed cardiothoracic surgeon in China, was employed in 2003 at UCLA Healthcare System as a researcher with the UCLA School of Medicine. On October 29, 2003, Zhou received a notice of intent to dismiss him from UCLA Healthcare for job performance reasons unrelated to his illegal access of medical records. That night, Mr. Zhou, without any legal or medical reason, accessed and read his immediate supervisor’s medical records and those of other co-workers.

For the next three weeks, Zhou’s continued his accessing of patient records including confidential health records belonging to various celebrities. According to court documents, Mr. Zhou accessed the UCLA patient records system 323 times during the three-week period, with most of the accesses involving well recognized celebrities. There is no allegation that he disseminated these private records to any third party.

In a plea agreement filed in court, Mr. Zhou admitted that he obtained and read private patient health and medical information on four specific occasions after he was formally terminated from the UCLA Healthcare System. Mr. Zhou acknowledged that at the time he viewed these patients’ medical information, he had no legitimate reason, medical or otherwise, for obtaining the personal information. Mr. Zhoa had a Mandarin interpreter at the hearing on the change of plea.

Mr. Zhou is scheduled to appear in federal court on March 22 to be sentenced by Judge Wistrich. At sentencing, Zhou faces a maximum statutory penalty of four years in federal prison.

Attorney Commentary: Protecting the privacy of patients is an excellent goal but whether or not an employee should be criminally prosecuted for reviewing medical records where there is no other illegal conduct is another matter. Most employees sign HIPAA agreements with employers but most of those do not inform the employees that it is a federal crime to view medical records for which they do not have a medical reason or permission to view. Employers should amend their HIPAA agreements to include such notification and health care employees should be careful to not review any such records or document why such records were reviewed (training, etc.). As a health care fraud attorney and HIPAA attorney, it is my opinion that only cases that have criminal intent should be prosecuted.

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green & Associates in Los Angeles, California focuses their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers. Their website is: http://www.greenassoc.com/

Los Angeles Doctor Gets 5 Years For Injuring Cyclists - latimes.com

Los Angeles doctor gets 5 years for injuring cyclists - latimes.com

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Attorney Commentary: This is an example of how a physician's involvement in a non-health care related criminal offense can impact his license. This was a July 2008 crash where 2 cyclists were injured. The sentence was long since it came after a jury trial where the doctor was convicted and the doctor had a prior conviction for reckless driving involving a cyclist.

We handled a similar case where an attorney became incensed at a bicyclist, chased him down and hit him. Although the attorney was charged with a felony, we immediately reached a civil settlement with the cyclist and the charges were dropped against the attorney. This is a tougher case since there were a couple of cyclists involved.

This is a reminder for all professionals -- especially males where anger management issues can arise more quickly -- that making any physical contact with another person can jeopardize not only your liberty but your license. Walking away needs to be the motto for all professionals in any altercation unless there is a clear threat to your own danger or that of someone there.

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green and Associates in Los Angeles, California focuses their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers. Their website is: http://www.greenassoc.com/

Grand Jury Indicts Los Angeles Doctor Who Headed Liver Transplant Program on Charges of Allegedly Covering Up Patient Switch With Falsified Records

On January 6, 2009, Dr. Richard R. Lopez Jr., a Los Angeles surgeon who was the director of the liver transplant program at St. Vincent Medical Center in Los Angeles was indicted by a federal grand jury for lying to the national organ transplant network after a liver accepted on behalf of one patient was instead transplanted into another patient who was significantly lower on the national wait list.

The eight-count indictment accuses Dr. Lopez of conspiracy, one counts of concealment of a material fact, and six counts of falsification of records in a matter under the jurisdiction of the United States Department of Health and Human Services. Dr. Lopez is scheduled to make his initial appearance on January 25. An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

According to the indictment, in September 2003, St. Vincent was offered a liver for a St. Vincent patient, identified as A-H, who ranked second on the match list for that liver, but who was in his home country of Saudi Arabia. The backup patient for the liver was at another local hospital. Instead of advising the organ procurement organization of the intended switch and allowing the organ to be offered to the backup patient, Dr. Lopez approved acceptance of the liver and its transplantation into a patient at St. Vincent—a patient identified in the indictment as A-B, who was ranked 52nd on the match list behind nine other St. Vincent patients.

After A-B received the liver, Dr. Lopez and his co-conspirators are accused of falsely telling authorities at the national organ transplant network that A-H had received the liver, and later submitted a falsified pathology report on A-H’s “explanted” (removed) liver. As a result of the false reporting, A-H was removed from the liver transplant wait list in September 2003, and was thereafter deprived of the opportunity to have this life-saving operation, according the indictment.

However, it is alleged that Dr. Lopez continued to tell A-H that he was on the liver transplant wait list and instructed A-H return to the United States in April 2004, when A-H was found to be too ill to be transplanted. He subsequently returned to Saudi Arabia, where he later died.

The indictment alleges that in reports filed until 2005 with the authorities operating the national organ transplant network, Dr. Lopez and unnamed co-conspirators continued to maintain the fiction that A-H had received the liver transplant. In 2005, the switch and cover-up were discovered by senior management at St. Vincent, and the matter was reported to authorities.

Dr. Lopez has not been associated with St. Vincent since late 2005. The hospital has fully cooperated with federal authorities since the beginning of the investigation.

Seven of the eight counts in the indictment relate to the false reporting of the recipient of the liver offered for A-H. The last count relates to another incident in which a liver was switched to a different recipient and, following the transplant, Dr. Lopez allegedly misrepresented the circumstances of the switch.

If convicted of the eight counts in the indictment, Lopez faces a statutory maximum penalty of 130 years in federal prison. The case was investigated by agents from the Department of Health and Human Services, Office of Inspector General and the Federal Bureau of Investigation.

Attorney Commentary: This case is reflective of two important factors: (1) it was the falsification of records that created the criminal problems and (2) the world-wide shortage of organs. The organ shortage is going to get worse before it gets better.

The Jan. 9, 2010 Wall Street Journal has an interesting and educating article on this issue entitled "The Meat Market." According to experts in this field, there are options. To increase the supply of transplant organs, it would be helpful to have presumed consent, financial compensation for living and deceased donors and point systems. Many people have died but there is a push for innovation in organ donation that will save lives.

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green & Associates in Los Angeles, California focuses their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers. Their website is: http://www.greenassoc.com/

Visiting Physicians Association to Pay $9.5 Million to Resolve False Claims Case For Home Health Services: How To Avoid Qui Tam Cases

On December 23, 2009, Visiting Physicians Association, which is based in Farmington Hills, Michigan, agreed to pay the United States and the State of Michigan $9.5 million to settle allegations that the association violated the False Claims Act. Visiting Physicians Association is a Michigan professional corporation which has provided home health services at various times in Michigan, Ohio, Georgia and Wisconsin.

The agreement settled allegations that Visiting Physicians Association submitted claims to the Medicare, TRICARE and Michigan Medicaid for unnecessary home visits and care plan oversight services, for unnecessary tests and procedures, and for more complex evaluation and management services than the services that Visiting Physicians Association actually provided.

This settlement resolved four lawsuits filed by private plaintiffs under the qui tam or whistleblower provisions of the False Claims Act, which permit private parties to file an action on the government’s behalf and share in any recovery. This settlement provides that the four whistleblower plaintiffs will collectively receive a total of approximately $1.7 million.

Attorney Commentary: While many health care providers are careful to avoid any "criminal" conduct and they know they will probably never be prosecuted for health care fraud -- it is more difficult to avoid having a former employee hire a law firm to file a qui tam suit.

Question: What is the number one thing you can do to avoid a qui tam lawsuit?
Answer: Compliance plan. Have it and maintain it.

Compliance plans have many merits, several of which relate to possible qui tam actions. Many individuals, particularly nurses and health care employees, become relators because of frustration stemming from repeated unsuccessful reports of suspected misconduct to management. An effective compliance plan provides a mechanism for action to be taken on such reports and in some cases will foreclose potential relators from concluding they have no alternative other than filing a qui tam.

In addition, effective compliance plans are designed to prevent and/or detect inappropriate conduct through reliance on intensive training, internal auditing, hotlines and other mechanisms. It is obviously the preferable course to have identified and resolved a potential problem through a compliance plan than to have it uncovered by a relator and employed as the foundation for a whistleblower action.

Posted by Tracy Green. Should you have any questions regarding your own situation or this post, you can email Tracy at tgreen@greenassoc.com. Green & Associates in Los Angeles, California focuses their practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers. Their website is: http://www.greenassoc.com/