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Prosecutorial anarchy and health care fraud explored
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Medical malpractice lawsuits are of immediate concern to orthopedic surgeons as they involve allegations of professional substandard care that are felt at a personal level. With increased scrutiny of medical practice, specifically in billing government providers for medical procedures, surgeons face the legal risk of being charged with a criminal indictment from the federal government. Such cases have raised interesting questions about legal procedures and attendant prosecution and remedies that are illustrated by two cases discussed in this article.
Civil penalty for overbilling Medicare
It was recently announced by the U.S. Attorney for the Middle District of Florida (Tampa) that Steven Chun, MD, who owned a pain clinic had entered into an agreement to pay $750,000 to resolve claims that he and his clinic billed Medicare for physician office visits that he did not perform. The United States alleged that between 2006 and 2011 the physician billed Medicare for office visits at the highest possible level. The United States claimed that he falsely billed for conducting comprehensive examinations of patients with complex problems. The United States further claimed that the physician was paid for examinations that he did not perform.
Lawrence H. Brenner
The Sarasota-based clinic and Chun came under scrutiny because of two nurses who worked for the physician and ended up as whistleblowers when they reported the alleged misconduct in billing procedures to the office of the United States Attorney. In a public statement, the United States Attorney stated, “This settlement is a significant achievement by our civil division, which showed great determination in pursuing a troubling pattern of billing fraud. This case should send a message that we will not tolerate this kind of health care fraud in the Middle District of Florida.”
The special agent in charge of the Department of Health and Human Services Office for the region stated, “Count on my agency to aggressively pursue cases whether the target is a large corporation or a single provider.” He went on to state, “Besides a significant payment, Chun has agreed to let an independent organization review his claims for 3 years and then report to the government.”
One news release characterized, “This settlement illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.”
Although the Justice Department asserts that it is “trying to send a signal” by imposing this civil fine, this case raises one of the most perplexing and contradictory issues in Medicare fraud. If, indeed, this physician was billing for procedures which had not been performed and misclassifying the level of care provided for higher reimbursement, why was not he indicted for the crime of health care fraud? On its face, these allegations represent significant and fraudulent conduct designed to inappropriately obtain Medicare reimbursement.
Criminal penalty for overbilling
Compare and contrast the Florida civil settlement above with the criminal indictment and conviction for health care fraud in the case of United States vs. McLean. The government alleged that McLean, an interventional cardiologist, was involved in a scheme to defraud insurers by submitting claims for medically unnecessary stent procedures. Coincidentally, the government’s investigation of McLean also began in 2006, similar to the Chun investigation above.
In McLean, the essence of the government’s case was that McLean relied on lower criteria than his peers when it came to the necessity to implant a coronary artery stent. McLean argued the medical standard for coronary stents alleged by the government was incorrect; that the process of evaluating the medical necessity of implanting a stent is highly subjective; and that the government’s claim that a stent could only be medically necessary when there was 70% stenosis was contradicted by the good outcomes and relief of symptoms which his patients experienced. Further, McLean vigorously argued that he was not placed on notice that he was at potential risk of being indicted and incarcerated and that, therefore, his conviction was unconstitutional. Significantly, the 4th Circuit Court of Appeals rejected his constitutional argument.
Why McLean was sentenced to a substantial period of incarceration, while the Tampa physician was only subject to a civil fine for comparable misconduct? Unfortunately, there is no easy answer to this question. The McLean outcome was particularly disturbing because the concept of “medical necessity” is difficult to define and often medically and scientifically obscure.
David H. Newman, MD, in his book, “Hippocrates’ Shadow” discussed the pervasive utilization of medications or medical procedures for which there is little, if any, persuasive evidence that they are scientifically sound. Among his many examples is the overutilization of antibiotics in viral illnesses. As Newman states, “It may be surprising to learn that antibiotics don’t work for bronchitis, or sore throats, or even colds … There is, however, real danger in this (prescribing antibiotics) approach. If it is conservatively presumed that 95% of antibiotic prescriptions for sore throat are unnecessary, then the number of unnecessary allergic reactions can be calculated.” Newman then calculates that “9.2 million unnecessary prescription antibiotics for sore throat occur annually.”
B. Sonny Bal
Based on the federal government actions in the above illustrated cases, is the prescribing of antibiotics when it is medically unnecessary, therefore, a federal crime? What if the unnecessary prescription leads to a catastrophic or even fatal anaphylactic reaction? It is clear that when it comes to health care fraud, we are living in a world of jurisprudential anarchy, with few, if any guidelines.
Newman also considered the risks and benefits of mammograms, specifically referring to the results of the Cochrane Collaboration. He states:
“Given these substantial costs and risks, in order to be considered beneficial mammograms should provide an impressive degree of benefit. To quantify the extent of this benefit, in 2001 the Cochrane Collaboration, a multidisciplinary group of scientists that produces what are widely believed to be the most respected and objective reviews in medicine, exhaustively examined the data on mammograms. The review included scrutiny of the seven largest and best studies ever done, including nearly half a million female study subjects from all over the world. The women were enrolled in studies and assigned to one of two groups: routine checkups including regularly scheduled mammograms, and routine checkups only. The women were then followed for over a decade to determine how many died in each group and how many lived. The total magnitude of the benefit was then calculated across all of these studies, and a rather surprising number was found: zero. Having mammograms was of no benefit at all.”
In his book “The Collapse of American Criminal Justice,” Harvard Law professor William A. Stuntz argues unequal treatment and chaos in the American judicial system can be attributed to the transfer of power over the last several decades from judges to prosecutors. He described “prosecutorial discretion” as a compelling, adverse component in our criminal justice system. Thus, in the Tampa case, the McLean case, and the use of antibiotics, whether there will be any action, a mere civil fine, or long-term incarceration, may depend solely on the discretion of the Justice Department.
Conclusions
Is it time for a comprehensive re-evaluation of how the federal government should approach issues involving questionable health care billing? Perhaps one approach would be a “safe harbor provision” such that the government notifies a physician or surgeon that they may be engaging in health care fraud. The physician or surgeon would then be provided an opportunity to “cure” any alleged claim of fraud, prior to being indicted. This would be particularly meaningful in cases alleging “lack of medical necessity,” where the physician or surgeon may not be on notice that there are claims that his or her practices are inappropriate and potentially criminal. Certainly, fairness and due process would require notice and some prior opportunity for correction, particularly in areas involving “medical necessity” which are scientifically often obscure. To criminalize this conduct as opposed to a civil fine may impose unequal treatment and unjust convictions in the field of health care fraud.
What do you think?
- Should the Tampa physician have been indicted?
- Should McLean have been indicted?
- What procedures are so medically unnecessary that they should lead to prosecution for health care fraud?
References:
Newman DH. Hippocrates’ Shadow. 2009; Simon and Schuster.
Stuntz WA. The Collapse of the American Criminal Justice. 2013; Belknap Press.
For more information:
B. Sonny Bal, MD, JD, MBA; and Lawrence H. Brenner, JD, are partners in the law firm of BalBrenner/Orthopedic Law Center and are the exclusive providers of loss prevention, risk management and quality improvement services for the Orthopedic Physician’s Insurance Company. Brenner can be reached at lbrenner@balbrenner.com.
Disclosures: Bal and Brenner have no relevant financial disclosures.