Legal and regulatory news roundup
Find out what’s happening in the world of federal healthcare regulations by reviewing some recent headlines from across the country.
Hospital’s EMTALA violations threaten its federal funding
CMS has threatened to cut Medicare and Medicaid funding for Indian Health Service’s (IHS) Sioux San Hospital in Rapid City, South Dakota, after an unannounced inspection in May found deficiencies in the emergency department.
According to the CMS report, the hospital failed to provide patients with timely medical screening examinations to determine whether they had an emergency medical condition, which is a violation of the Emergency Medical Treatment and Active Labor Act of 1986 (EMTALA). CMS based its findings on a review of medical records and interviews with patients, patient representatives, and hospital staff.
A case cited in the CMS report recounts how a mother brought her 6-month-old baby to the emergency department at Sioux San complaining of congestion, cough, runny nose, and watery eyes. The attending provider diagnosed the baby with a viral respiratory infection without taking a patient history, which would have revealed that the baby was born premature and had a history of respiratory distress. The baby later had a seizure and spent time in the ICU at another facility.
Shortly after the inspection, CMS informed IHS that it had until June 15 to address the deficiencies or risk losing Medicare and Medicaid reimbursements. IHS has submitted a 31-point correction action plan, which CMS has accepted.
The corrective plan includes:
- A review and revision of the existing EMTALA policies and staff training on any updates.
- 24-hour coverage of the emergency department by a MD or DO every day. During high-volume periods, a second provider will be added.
- Pediatric assessment training for all emergency department physicians and nurses.
- A pediatrician on call 24/7 for consultations.
- Timely medical screening examinations provided for all patients in the emergency department.
- FPPE performed on the last 10 pediatric patients of all emergency department providers and medical staff.
- Daily situation reports for IHS area directors, prepared by the hospital’s CEO.
Three defendants plead guilty in $ 580 million fraud, kickback case
The U.S. government’s ongoing investigation into kickbacks paid for patient referrals and fraudulent billing at Pacific Hospital in Long Beach, California, has led to three more defendants pleading guilty to federal charges. They join six other individuals who have already pleaded guilty to charges of participating in a 15-year-long scheme that illegally referred thousands of patients to the hospital and generated hundreds of millions in fraudulent billings.
The investigation is looking into allegations that dozens of surgeons and other medical professionals participated in a scheme with Pacific Hospital in which they were paid kickbacks for referring patients to the hospital for spinal surgeries. Members of the conspiracy were paid $ 15,000 for every lumbar fusion surgery and $ 10,000 for every cervical fusion surgery referred to Pacific Hospital. During the last eight years of the scheme, Pacific Hospital submitted more than $ 580 million in bills for spinal surgeries, many of which were paid by the federal workers’ compensation system and the California workers’ compensation system.
The latest defendants to plead guilty are Michael Drobot Jr., Linda Martin, and Michael Barri.
Drobot Jr. pleaded guilty to charges of conspiracy and illegal kickback charges and faces up to 10 years in prison. He is the son of Michael Drobot Sr., the owner of Pacific Hospital who previously pleaded guilty to orchestrating the scheme in April 2014. Drobot Jr. solicited physicians and chiropractors to enter into the kickback arrangements with the hospital and served as a liaison with medical professionals.
Martin, a marketer for Pacific Hospital, also pleaded guilty to a conspiracy charge for recruiting medical professionals to refer patients to the hospital in exchange for kickbacks. She could be sentenced to up to five years in prison for her charge.
Barri, a chiropractor, pleaded guilty to a conspiracy count and admitted he received more than $ 158,000 in kickbacks during a nine-month period for referring dozens of patients to Pacific Hospital. Pacific Hospital used Barri’s referrals to bill insurance carriers $ 3.9 million for spinal surgeries. He faces up to five years in prison.
Drobot Jr., Martin, and Barri, along with the previous six defendants, have agreed to cooperate with the ongoing investigation being conducted by the FBI, the U.S. Postal Service Office of Inspector General, IRS Criminal Investigation, and the California Department of Insurance.
Healthcare providers responding to online reviews may violate HIPAA
A report from ProPublica has found that some healthcare providers apparently violate HIPAA when replying to reviews on the rating website Yelp. After analyzing more than 1.7 million reviews on the website, ProPublica found that some physicians, dentists, and chiropractors shared patient health information when responding to online criticism from patients.
ProPublica identified more than 3,500 one-star reviews on Yelp that mentioned privacy and HIPAA. The report further details several instances of HIPAA violations, which have resulted in warnings from the U.S. Department of Health and Human Services’ Office for Civil Rights as well as ongoing investigations after the patients filed complaints. The Office for Civil Rights, however, does not track how many complaints it has received regarding HIPAA violations on Yelp.
ProPublica was able to speak to some patients who claim their personal information was disclosed by providers on Yelp. They said the violation of their medical privacy only compounded the damage they received from poor care.
Physician indicted on kickback charges
A federal grand jury has indicted Hailu T. Kabtimer, MD, of Henderson, Tennessee, with five counts of violating the federal anti-kickback act.
According to the U.S. Attorney’s Office for the Middle District of Tennessee, from 2013 to 2014, Kabtimer allegedly accepted cash payments in exchange for patients to a particular medical equipment supplier.
During that time, the indictments alleged Kabtimer allegedly accepted kickback payments on eight occasions, totaling $ 3,400. Additionally, Kabtimer allegedly accepted $ 200 for every patient he referred for a continuous positive airway pressure ventilator and $ 300 for every patient he referred for an oxygen unit.
In a statement, U.S. Attorney David Rivera said, "Medical providers who break the law to enrich themselves will be caught and prosecuted … This office and our law enforcement partners will continue our vigorous efforts to enforce the anti-kickback law and to hold accountable medical professionals who accept illegal cash kickbacks."
If found guilty, Kabtimer faces up to five years in prison for each count. He would also face forfeiture of any proceeds traced back to offenses.
Data breach compromises 4,000 patients’ protected health information
More than 4,000 patients of Complete Chiropractic & Bodywork Therapies (CCBT) of Ann Arbor, Michigan, were recently notified of a breach that may have been exposed their treatment and billing information. This includes patients’ encrypted electronic medical record data, such as their names, dates of birth, addresses, Social Security numbers, and health/diagnosis information.
CCBT reported the breach after discovering a server infected with malware. The server was immediately secured and disconnected from the internet; all workstation and vendor passwords were changed, and additional IT security safeguards were put in place, according to a statement released by CCBT.
An investigation determined that the malware was likely scanning for login and password information and that the first unauthorized access occurred four months prior to the breach’s discovery. However, CCBT noted that there was no indication that any patient information had been taken or inappropriately used.
CCBT has offered all affected patients a free year of identity theft protection.
Patient recruiter sentenced for Medicare fraud, kickback scheme
Carlos Rodriguez Nerey, owner and president of Nerey Professional Services, Inc., a Miami-based consulting and staffing company, will spend five years in prison for his role in a $ 2.3 million Medicare fraud scheme.
In April, following a one-week jury trial, Nerey was convicted of one count of conspiracy to defraud the United States and pay and receive healthcare kickbacks, and one count of receiving healthcare kickbacks. At Nerey’s recent sentencing, U.S. District Judge Darrin P. Gayles of the Southern District of Florida imposed the prison term and ordered that Nerey pay $ 2.3 million in restitutions.
From October 2014 to September 2015, Nerey would accept kickbacks from Miami-based healthcare agencies Mercy Home Care, Inc., and D&D&D Home Health Care, Inc., in exchange for referring Medicare beneficiaries to serve as patients. Some patients didn’t actually qualify for home healthcare services based on Medicare’s rules and regulations. Nerey’s actions contributed to the submission and subsequent payment of millions of dollars in fraudulent claims to Medicare.
According to evidence presented at trial, Nerey created a shell company to accept approximately $ 250,000 in kickbacks from the two home healthcare agencies. He had also previously worked for several other fraudulent home healthcare agencies in the area.