A recent health care fraud case in San Diego relates to alternative cancer and health care treatments and billing of insurance carriers. I expect to see an increase in the prosecution of health care fraud cases relating to the billing of private insurance companies and not just Medicare and Medi-Cal (Medicaid).
On February 8, 2010, William R. Fry and Dr. Geronimo Rubio in Case No. 04cr1276, were sentenced in federal court in San Diego by the Honorable John A. Houston, United States District Court Judge, to serve 14 months and 12 months in custody, respectively, followed by three years of supervised release following their release from prison.
Mr. Fry and Dr. Rubio each pled guilty to health care fraud and federal income tax felonies in June 2007. Judge Houston also ordered that, for their health care fraud convictions, Mr. Fry and Dr. Rubio were to pay $63,237 in restitution to insurance providers. Mr. Fry was also ordered to pay the Internal Revenue Service (IRS) $314,159 in back taxes plus interest and penalties for tax years 1997 through 2003. Dr. Rubio was ordered to pay the IRS $356,311 in back taxes plus interest and penalties for tax years 1998 through 2003.
According to court records, Dr. Rubio and Mr. Fry jointly owned and controlled a business called “American Metabolic Institute,” in Bonita, California. The defendants operated a health care clinic called “Hospital San Martin,” in Tijuana, Mexico. The clinic, under the direction of Dr. Rubio, offered alternative medicines and treatments to patients, many of whom were diagnosed with cancer. In their pleas, the defendants admitted that they submitted false bills to American insurance companies and that each defendant substantially under-reported his true income on his individual federal income tax returns.
It appears that the American Metabolic Institute had numerous complaints regarding the cost of treatment from patients. There were many supporters of the alternative care but when alternative treatment do not "cure" cancer or other diseases, there will be complaints. Law enforcement can take a view that the alternative provider is preying upon desperate people with cancer. Alternative providers need to be very careful and create systems and protocols that document informed consents and the nature of the alternative treatment.
Alternative health care providers need to realize that their websites and publications will be scrutinized carefully. One bad result or unhappy patient can result in a complaint to a Medical Board or governmental agency. The website will be one of the first things an investigator reviews. For example, Dr. Rubio still has a website that has success stories of cancer going into remission with immunology treatment. These treatments are different than traditional oncology and the websites should also be reviewed by a health care attorney.
Now a brief comment about the tax fraud counts. For those who bill private insurance companies and the government, you will always be under scrutiny and subject to audit and review. This also means that if there are allegations of wrongdoing, your tax returns will also be under a microscrope. The threat of a tax fraud prosecution which is document based -- black and white, no issue of medical necessity -- can often be the hammer that forces a guilty plea. This is also something that as a licensed professional or health care provider you need to consider when operating your business. Part of your compliance with rules and regulations should include compliance with taxes (federal and state) since there is exposure there as well.
Should you have any questions regarding your own situation or this post, you can email physician attorney Tracy Green at tgreen@greenassoc.com. Green & Associates is located in downtown Los Angeles, California and 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 alternative health care providers. Ms. Green is a naturopathic doctor attorney and is a member of the Board of Directors of the California Naturopathic Doctors Association. The firm website is: http://www.greenassoc.com/
