Physicians who order home health where it is not medically necessary can be charged with Medicare fraud. If that same physician orders medications, especially controlled substances, without seeing the patient on a regular basis, that can be another ground for a fraud charge.
The loss amounts can be huge since the physician will be held responsible for the total amount of billings by the home health agency and the pharmacy's prescriptions. A recent case illustrates a physician who ordered home health in exchange for payments and then also prescribed some pain medications that were medically unnecessary.
On January 6, 2020, Kain Kumar, a former doctor, was sentenced to 24 months in federal
prison after having pleaded guilty in April 2019 to one count of health care fraud and one count of distribution of hydrocodone. Mr. Kumar practiced internal medicine, maintained medical offices in Palmdale, Rosamond, and Ridgecrest, California and surrendered his medical license last year.
He was sentenced by U.S. District Judge Philip
S. Gutierrez. Mr. Kumar was also ordered to pay financial penalties totaling more
than $1 million, consisting of $509,365 in restitution, $494,900 in asset
forfeiture, and a $72,000 fine.
In the plea agreement, Mr. Kumar admitted that from February 2011 until May 2016, he defrauded the Medicare health care
benefit program by prescribing unnecessary home health services in exchange for
the payment of illegal kickbacks to him from a La Verne-based home health agency
called Star Home Health Resources, Inc.
According to the indictment in this
case, Medicare allegedly paid $4,398,599 to Star based on the illegal kickback-tainted
referrals from Mr. Kumar which is greater than the restitution amount ordered which is one of the benefits of entering a guilty plea where the facts are damaging since the sentencing guidelines vary depending on the restitution loss amount.
In the plea, Mr. Kumar admitted that he caused false and fraudulent claims for
reimbursement to be submitted to Medicare for Medicare beneficiaries that he
did not personally examine or for patients he only briefly examined. Mr. Kumar admitted that he also
prescribed drugs that were not medically necessary and which were paid for by
the Medicare Part D program.
In addition, Mr. Kumar admitted in his plea agreement that between February 2013
and January 2016, that he – without a legitimate medical purpose – prescribed
23,826 pills of the opioid drug hydrocodone (commonly sold under the brand name
Vicodin or Norco) and 38,459 pills of the muscle-relaxer carisoprodol (sold
under the brand name Soma).
Mr. Kumar admitted that he directed his office staff – who were not
medical professionals – to issue prescriptions for these drugs to patients even
though Mr. Kumar had not examined the patients. Mr. Kumar admitted that he directed his office staff to
sign his name on prescriptions for opioid drugs and also provided his staff
with pre-signed prescriptions. In one instance, although Mr. Kumar examined a
patient only once on the patient’s very first visit, and thereafter he caused
prescriptions to be issued to the patient for hydrocodone and carisoprodol on a
monthly basis for approximately a year and a half even though Mr. Kumar did not
actually see the patient for any subsequent physician examination.
This case is the fifth one involving Star Home Health. Previously, Elaine C. Lat, Star’s chief operating officer and the case’s lead
defendant, was sentenced to a 30-month prison sentence after pleading
guilty in May 2017 to one count of conspiracy and four counts of paying illegal
kickbacks. Three other defendants, including Ms. Lat’s parents, each pleaded guilty
to criminal charges and were also sentenced in this matter.
Attorney Commentary: Physicians need to be very careful in ordering home health for patients. If it is deemed not medically necessary, the physician can be liable civilly or criminally for health care fraud. If the physician is paid anything by the home health agency, then the home health billing is automatically deemed a false claim. Home health agencies approach physicians and offer them medical directorships or other sham arrangements in order to hide the kickbacks but that approach can often lead the physician into legal issues. Home health agencies see other businesses offering the same type of arrangements and assume that it must be kosher, but it is generally not.
Any compensation arrangements between a physcian and home health should be reviewed by an experience attorney and there should be an opinion letter issued on the matter where all the facts have been disclosed to the attorney. Comments to the physician such as "we will expect 5 or 6 referrals a month" should immediately raise a red flag.
