Medical Justice provides free consultations to doctors facing medico-legal obstacles. We have solutions for doctor-patient conflicts, unwarranted demands for refunds, online defamation (patient review mischief), meritless litigation, and a gazillion other issues. If you are navigating a medico-legal obstacle, visit our booking page to schedule a free consultation – or use the tool shared below.

Sometimes doctors find themselves in toxic work relationships. Perhaps they’ve joined a group or healthcare institution, wildly idealistic, and ready to do the best job possible. Soon, they learn about the corporate culture. It’s not pretty. There may be some backstabbing. Poor communication. Rotten service. But, if they keep their head down, they can stay out of the crossfire.

Then, they learn about billing fraud. With their name being used to submit insurance claims.

Now what?

If the claim is in your name, and you take no action, you may get caught in the inevitable dragnet. It’s not a good idea to remain willfully blind when your license and freedom are on the line. The carriers (including the federal and state government) will want their money back.

Enter the False Claims Act. What’s that?

It’s easier just to quote directly from the Department of Justice website.

Many of the [DOJ] Fraud Section’s cases are suits filed under the False Claims Act (FCA), 31 U.S.C. §§ 3729 – 3733, a federal statute originally enacted in 1863 in response to defense contractor fraud during the American Civil War.

The FCA provided that any person who knowingly submitted false claims to the government was liable for double the government’s damages plus a penalty of $2,000 for each false claim.  The FCA has been amended several times and now provides that violators are liable for treble damages plus a penalty that is linked to inflation.

In addition to allowing the United States to pursue perpetrators of fraud on its own, the FCA allows private citizens to file suits on behalf of the government (called “qui tam” suits) against those who have defrauded the government.  Private citizens who successfully bring qui tam actions may receive a portion of the government’s recovery.  Many Fraud Section investigations and lawsuits arise from such qui tam actions.

The Department of Justice obtained more than $2.2 billion in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending Sept. 30, 2022.

Qui Tam lawsuits allow private citizens to step into the shoes of the government to prosecute claims against fraudsters. Sometimes the government will then step in and take over. Sometimes, they take a pass and allow the person with insider information to go all the way. If money is collected, some of what is collected is used to pay the one who provided the information to make this happen. The whistleblower wins the lottery.

A payday for turning in the fraudster.

Of the more than $2.2 billion in False Claims Act settlements and judgments reported by the Department of Justice this past fiscal year, over $1.7 billion related to matters that involved the health care industry, including drug and medical device manufacturers, durable medical equipment, home health and managed care providers, hospitals, pharmacies, hospice organizations, and physicians. The amounts included in the $1.7 billion reflect recoveries arising only from federal losses, and, in many of these cases, the department was instrumental in recovering additional amounts for state Medicaid programs.

As noted above, the $2.2 billion addressed money collected by the federal government. State governments also got in on the action.

And some states have unique laws which allow for collection of whistleblower awards related to fraud against private insurers.

In 2015, there was a $22.75 million settlement with Warner Chilcott (pharmaceutical manufacturer)—invoking California Insurance Frauds Prevention Act (CIFPA) involving fraud against private health plans. The plaintiff whistleblower received 49% of the recovery.

Back to federal whistleblower cases.

In 1986, Congress strengthened the False Claims Act by increasing incentives for whistleblowers to file lawsuits alleging false claims on behalf of the government. These whistleblower, or qui tam, actions comprise a significant percentage of the False Claims Act cases that are filed. Qui tam cases may be pursued by the government or the whistleblower, and this past year significant recoveries were obtained by both. When a qui tam action is successful, the whistleblower, also known as the relator, typically receives a portion of the recovery ranging between 15% and 30%. Whistleblowers filed 652 qui tam suits in fiscal year 2022, and this past year the department reported settlements and judgments exceeding $1.9 billion in these and earlier-filed suits.

The list of whistleblower or government audited lawsuits alleging healthcare fraud is long.

Select highlights.

Carrefour Associates LLC and its related companies, which operate under the name Crossroads Hospice, paid $5.5 million to resolve allegations that Crossroads Hospice knowingly submitted false claims to Medicare for hospice services for patients who were not terminally ill.

Signature Home Health Services of Florida LLC and its related entities (collectively, SignatureHomeNow) paid $2.1 million to resolve allegations that SignatureHomeNow improperly admitted and provided services to Medicare beneficiaries who: (i) were not homebound; (ii) did not require certain skilled care; (iii) did not have valid or otherwise appropriate plans of care in place; and/or (iv) did not have appropriate face-to-face encounters needed to be appropriately certified to receive home health services.

Hayat Pharmacy paid $2.05 million to resolve allegations that it submitted false claims to Medicare and Medicaid for prescription medications that the pharmacy had switched from lower cost medications to higher cost medications without any medical need and/or a valid prescription.

The department also resolved several matters in which providers billed federal health care programs for unnecessary drug testing. Physician Partners of America LLC (PPOA), its founder, its former chief medical officer, and certain of its affiliated entities paid $24.5 million to resolve allegations that they billed federal health care programs for unnecessary urine drug, psychological, and genetic testing. The United States alleged that PPOA required its physician-employees to order multiple urine drug tests at the same time without determining whether any testing was reasonable and necessary, or even reviewing the results of initial testing to determine whether additional testing was warranted. Similarly, the United States alleged that PPOA instructed physicians to automatically order psychological and genetic testing that it did not use or intend to use, and that PPOA instructed physicians to schedule bi-weekly telehealth appointments for the sole purpose of increasing revenue during the pandemic. Finally, the United States alleged that, at the time PPOA was engaged in this conduct, it obtained a loan under the Paycheck Protection Program while certifying that it was not engaged in illicit activity. This settlement resolved allegations under the False Claims Act, the Physician Self-Referral Law (Stark Law), and the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA).

MD Spine Solutions LLC dba MD Labs Inc. and two of its owners agreed to pay up to $16 million to resolve allegations that MD Labs submitted claims for medically unnecessary urine drug tests.

Who is motivated to file qui tam lawsuits? Employees with a conscience. Employees who were fired for speaking up. Employees on the receiving end of demotions, pay cuts, bullying. Employees who asked their boss to fix a problem and were told to shut up. Ex-spouses with insider information.

As you can see above, whistleblowers who win their case (or contributed to the government winning its case), can receive quite a handsome payday; sometimes enough to live on for the rest of their life.

None of this is to suggest the process is easy. But if you see fraud and the problem is not timely remedied, there are incentives to speaking up.

What do you think?

Medical Justice provides free consultations to doctors facing medico-legal obstacles. We have solutions for doctor-patient conflicts, unwarranted demands for refunds, online defamation (patient review mischief), meritless litigation, and a gazillion other issues. If you are navigating a medico-legal obstacle, visit our booking page to schedule a free consultation – or use the tool shared below.

Jeffrey Segal, MD, JD

Chief Executive Officer and Founder

Dr. Jeffrey Segal, Chief Executive Officer and Founder of Medical Justice, is a board-certified neurosurgeon. Dr. Segal is a Fellow of the American College of Surgeons; the American College of Legal Medicine; and the American Association of Neurological Surgeons. He is also a member of the North American Spine Society. In the process of conceiving, funding, developing, and growing Medical Justice, Dr. Segal has established himself as one of the country’s leading authorities on medical malpractice issues, counterclaims, and internet-based assaults on reputation.

Dr. Segal was a practicing neurosurgeon for approximately ten years, during which time he also played an active role as a participant on various state-sanctioned medical review panels designed to decrease the incidence of meritless medical malpractice cases.

Dr. Segal holds a M.D. from Baylor College of Medicine, where he also completed a neurosurgical residency. Dr. Segal served as a Spinal Surgery Fellow at The University of South Florida Medical School. He is a member of Phi Beta Kappa as well as the AOA Medical Honor Society. Dr. Segal received his B.A. from the University of Texas and graduated with a J.D. from Concord Law School with highest honors.

In 2000, he co-founded and served as CEO of DarPharma, Inc, a biotechnology company in Chapel Hill, NC, focused on the discovery and development of first-of-class pharmaceuticals for neuropsychiatric disorders.

Dr. Segal is also a partner at Byrd Adatto, a national business and health care law firm. Byrd Adatto was selected as a Best Law Firm in the 2023 edition of the “Best Law Firms” list by U.S. News – Best Lawyers. With over 50 combined years of experience in serving doctors, dentists, and other providers, Byrd Adatto has a national pedigree to address most legal issues that arise in the business and practice of medicine.

Medical Justice provides free consultations to doctors facing medico-legal obstacles. We have solutions for doctor-patient conflicts, unwarranted demands for refunds, online defamation (patient review mischief), meritless litigation, and a gazillion other issues. If you are navigating a medico-legal obstacle, visit our booking page to schedule a free consultation – or use the tool shared below.

Physicians can be held accountable by professional licensing boards for actions outside of the exam room and surgery suite. For example, if you are pulled over with a DUI, do not be surprised if the Board gets involved. Yes, nothing you did directly impacted patient care. You were presumably not taking care of a patient when the police pulled you over. But many Boards presume that a DUI is a harbinger of a general alcohol abuse problem which could turn into a later patient safety matter. Alcohol abuse may cloud one’s judgment while taking care of a patient. Or the Board may conclude you will show up while on call and have ETOH on your breath.

Danielle Roberts was licensed as a physician in NY. She became involved with the NXIVM cult. She had previously been invited to join a “secret society: called Dominus Obsequious Soroium, or DOS.” Entry to the secret society required being branded on the pelvis with the initials of NXIVM’s founder, Keith Raniere. Dr. Roberts performed at least 17 such brandings, captured on video.

One such “brandee” left the secret society, and filed a complaint to the Board of Medicine.

New York’s Bureau of Professional Medical Conduct (OPMC) charged Roberts with 47 counts of professional misconduct. In addition to the brandings, she was accused of failing to report the outbreak of an infectious norovirus-like illness at a NXIVM retreat.

Roberts countered that branding was not the practice of medicine and the OPMC had no jurisdiction to discipline on that charge.

The hearing committee disagreed and revoked her license to practice medicine. Roberts appealed and the case went to trial court, which upheld the decision revoking her license.

“Unlike tattooing and body art, branding is not regulated in New York, but courts have nonetheless considered electric cauterization to come under the purview of a medical procedure,” wrote Justice Lisa Fisher. And the hearing committee had substantial evidence to establish a professional connection, including Roberts’s own testimony that she relied on her medical expertise and had been approached by society members to fulfill the role of brander for that reason. “Several of the DOS members who were branded, including the complainant, provided testimony to the effect that they were relieved or comforted knowing that a physician would be performing the branding,” Justice Fisher noted.

The Justice also noted that Dr. Roberts used her medical knowledge to achieve a particular outcome.

“Although petitioner contends that her ritualistic branding of DOS members was for nonmedical reasons and lacked a sufficient nexus with the practice of medicine, it is apparent that petitioner used her medical knowledge and training to create a specific physical condition – a permanent scar – on the enrollees. In doing so, the Bureau’s expert testified that petitioner’s actions in branding DOS members constituted the practice of medicine by ‘operating’ on a physical condition.”

Dr. Roberts provided post-branding care, and society-members were foreclosed from selecting other physicians from such care.

Department of Justice photo of Danielle Robert

Multiple women were branded with a cauterizing tool wielded by a doctor in a secret ritual.

Yellowstone Spoiler Alert: In one episode, ranchers working at the Yellowstone Ranch engaged in group activity, which if revealed, would end in prison terms for all. The ranchers were asked to prove their fealty by first being branded. Once branded with the ranch’s logo, the ranchers pulled off their mischief, with the understanding that all had sealed lips. Given Dr. Roberts’ situation, one wonders if the fellow ranch hands were practicing medicine without a license. Back to the DOS cult, if Dr. Roberts had taken a pass and sent a “branding iron” to another cult member, would they have been convicted of practicing medicine without a license? By the way, the tools used in Yellowstone were different than those used in NVIXM/DOS. Roberts was alleged to have used a cauterizing pen, as opposed to a branding iron.

In 2020, the founder of NXIVM and the inspiration for the branding logo, Keith Raniere, was sentenced to 120 years in prison.

Finally, another physician lost his license over his involvement with NVIXM.

Brandon Porter, a medical doctor, conducted unlicensed human-subjects research on 200 people for NXIVM. During a “fright study”, Porter exposed subjects to disturbing videos, including actual footage of a decapitation. In 2016, Porter was present at a NXIVM retreat (“V-Week”) where 300 to 400 individuals were struck by an unidentified disease; Porter failed to report the outbreak, in violation of his duties as a licensed medical doctor.  Porter was stripped of his medical license in 2020.

The details:

Brandon B. Porter, a former doctor at St. Peter’s Hospital in Albany, violated 40 state and federal regulations, according to an investigation against him by the New York Department of Health. The department’s investigation into Porter found that the doctor not only conducted unlicensed “human subject research,” but that he failed to obtain proper consent from people or keep records from his supposed studies.

Between 2010 and 2017, Porter allegedly performed unsanctioned neurological research on more than 200 “subjects” to study psychological responses to certain stimuli as part of NXIVM’s studies into Tourette’s syndrome, Obsessive-Compulsive Disorder, and “Executive Success Program” for self-betterment, according to the department’s investigation.

In one study, dubbed the “Fright Study,” Porter forced his subjects to watch violent and “horrific” video clips, including footage of four women being dismembered with a machete and a conscious male being forced to eat his own brain matter.

“The Respondent, who knew or should have known that human subjects participating in the Fright Study could have been caused mental pain and suffering, and/or psychological injury while viewing the disturbing and violent actual video and film clips, failed to terminate such study,” the department of health said in its investigation.

Regarding this allegation against Dr. Roberts:

“…she was accused of failing to report the outbreak of an infectious norovirus-like illness at a NXIVM retreat.”

Losing one’s license over that oversight seems unduly harsh.

The take-home point is this. As physicians, our behavior is held to higher standards than the general public. The medical professionals in this cult seemingly avoided prison time. But their careers as physicians seem to be over.

What do you think?

Medical Justice provides free consultations to doctors facing medico-legal obstacles. We have solutions for doctor-patient conflicts, unwarranted demands for refunds, online defamation (patient review mischief), meritless litigation, and a gazillion other issues. If you are navigating a medico-legal obstacle, visit our booking page to schedule a free consultation – or use the tool shared below.

Jeffrey Segal, MD, JD

Chief Executive Officer and Founder

Dr. Jeffrey Segal, Chief Executive Officer and Founder of Medical Justice, is a board-certified neurosurgeon. Dr. Segal is a Fellow of the American College of Surgeons; the American College of Legal Medicine; and the American Association of Neurological Surgeons. He is also a member of the North American Spine Society. In the process of conceiving, funding, developing, and growing Medical Justice, Dr. Segal has established himself as one of the country’s leading authorities on medical malpractice issues, counterclaims, and internet-based assaults on reputation.

Dr. Segal was a practicing neurosurgeon for approximately ten years, during which time he also played an active role as a participant on various state-sanctioned medical review panels designed to decrease the incidence of meritless medical malpractice cases.

Dr. Segal holds a M.D. from Baylor College of Medicine, where he also completed a neurosurgical residency. Dr. Segal served as a Spinal Surgery Fellow at The University of South Florida Medical School. He is a member of Phi Beta Kappa as well as the AOA Medical Honor Society. Dr. Segal received his B.A. from the University of Texas and graduated with a J.D. from Concord Law School with highest honors.

In 2000, he co-founded and served as CEO of DarPharma, Inc, a biotechnology company in Chapel Hill, NC, focused on the discovery and development of first-of-class pharmaceuticals for neuropsychiatric disorders.

Dr. Segal is also a partner at Byrd Adatto, a national business and health care law firm. Byrd Adatto was selected as a Best Law Firm in the 2023 edition of the “Best Law Firms” list by U.S. News – Best Lawyers. With over 50 combined years of experience in serving doctors, dentists, and other providers, Byrd Adatto has a national pedigree to address most legal issues that arise in the business and practice of medicine.

Doctors are frequently asked to fill out a variety of forms. No one loves doing it. But it’s part of the job.

Two recent questions by our members highlighted situations when the “ask” goes beyond what is “allowed.”

The first situation addressed a patient wanting to tap into her FSA account. FSA stands for Flexible Spending Account. It lets an employee put away pre-tax dollars for qualified medical expenses. Employers may make contributions to FSA accounts. If you don’t use it, you lose it.

Qualified medical expenses seems like a straightforward term. But does it apply to an elective cosmetic surgery? Meaning, can a routine cosmetic surgery be covered by a FSA? If the surgery is performed strictly for cosmetic reasons, the answer is generally no. And since FSA are covered by IRS regulations, the same caveat applies to Health Savings Accounts (HSAs).

In accordance with IRS regulations regarding taxable medical deductions, IRC 213(d) is especially relevant in regards to the eligibility of certain medical expenses like cosmetic procedures. Under IRS 213(d), medical care refers to:

“The term “medical care” means amounts paid for the diagnosis, cure, mitigation, treatment or prevention of a disease, or for the purpose of affecting any structure or function of the body.”

This particular definition is vital in helping benefits administrators determine whether a specific medical procedure is eligible for reimbursement through consumer-directed healthcare accounts like FSAs, HSAs and HRAs. In the vast majority of cases, cosmetic procedures are not meant to prevent or treat a specific medical condition or are simply done for “general health” purposes, so therefore they are rarely covered by most consumer spending accounts.

A cosmetic surgery/procedure is any surgery/procedure that is directed at improving the patient’s appearance and does not meaningfully promote the proper function of the body or prevent or alleviate an illness or disease.

Are there exceptions to this rule?

Yes.

If the cosmetic procedure is performed to address a medical problem, such as a congenital abnormality, or reconstruction after an accident or disfiguring illness, it will likely be covered, assuming it is covered by a letter of medical necessity. This letter must outline how an account holder’s medical condition necessitates a specific cosmetic procedure, how the treatment will be used to alleviate the issue.

If the cosmetic procedure is elective and unrelated to an underlying medical condition, then no letter of medical necessity can/should be written. And such a procedure will likely not be covered by FSA or HSA.

Onward to paperwork for Family and Medical Leave Act (FMLA).

From the Department of Labor’s website:

The FMLA entitles eligible employees of covered employers to take unpaid, job-protected leave for specified family and medical reasons with continuation of group health insurance coverage under the same terms and conditions as if the employee had not taken leave. Eligible employees are entitled to:

• Twelve workweeks of leave in a 12-month period for:

• • the birth of a child and to care for the newborn child within one year of birth;
  • the placement with the employee of a child for adoption or foster care and to care for the newly placed child within one year of placement;
  • to care for the employee’s spouse, child, or parent who has a serious health condition;
  • a serious health condition that makes the employee unable to perform the essential functions of his or her job;
  • any qualifying exigency arising out of the fact that the employee’s spouse, son, daughter, or parent is a covered military member on “covered active duty;”

OK, is elective cosmetic surgery a serious health condition?

Again, from the Dept. Of Labor:

Serious health condition means an illness, injury, impairment or physical or mental condition that involves inpatient care as defined in § 825.114 or continuing treatment by a health care provider as defined in § 825.115. Conditions for which cosmetic treatments are administered (such as most treatments for acne or plastic surgery) are not “serious health conditions” unless inpatient hospital care is required or unless complications develop. Restorative dental or plastic surgery after an injury or removal of cancerous growths are serious health conditions provided all the other conditions of this regulation are met. Mental illness or allergies may be serious health conditions, but only if all the conditions of § 825.113 are met.

See a theme?

Elective cosmetic surgery not addressing some underlying medical condition generally does not warrant reimbursement under FSA accounts, HSA accounts, or protected leave under the Family and Medical Leave Act. That does not mean your patients will not ask. But be careful about certifying eligibility unless the core conditions are met.

What do you think?

Medical Justice provides free consultations to doctors facing medico-legal obstacles. We have solutions for doctor-patient conflicts, unwarranted demands for refunds, online defamation (patient review mischief), meritless litigation, and a gazillion other issues. If you are navigating a medico-legal obstacle, visit our booking page to schedule a free consultation – or use the tool shared below.

Jeffrey Segal, MD, JD

Chief Executive Officer and Founder

Dr. Jeffrey Segal, Chief Executive Officer and Founder of Medical Justice, is a board-certified neurosurgeon. Dr. Segal is a Fellow of the American College of Surgeons; the American College of Legal Medicine; and the American Association of Neurological Surgeons. He is also a member of the North American Spine Society. In the process of conceiving, funding, developing, and growing Medical Justice, Dr. Segal has established himself as one of the country’s leading authorities on medical malpractice issues, counterclaims, and internet-based assaults on reputation.

Dr. Segal was a practicing neurosurgeon for approximately ten years, during which time he also played an active role as a participant on various state-sanctioned medical review panels designed to decrease the incidence of meritless medical malpractice cases.

Dr. Segal holds a M.D. from Baylor College of Medicine, where he also completed a neurosurgical residency. Dr. Segal served as a Spinal Surgery Fellow at The University of South Florida Medical School. He is a member of Phi Beta Kappa as well as the AOA Medical Honor Society. Dr. Segal received his B.A. from the University of Texas and graduated with a J.D. from Concord Law School with highest honors.

In 2000, he co-founded and served as CEO of DarPharma, Inc, a biotechnology company in Chapel Hill, NC, focused on the discovery and development of first-of-class pharmaceuticals for neuropsychiatric disorders.

Dr. Segal is also a partner at Byrd Adatto, a national business and health care law firm. Byrd Adatto was selected as a Best Law Firm in the 2023 edition of the “Best Law Firms” list by U.S. News – Best Lawyers. With over 50 combined years of experience in serving doctors, dentists, and other providers, Byrd Adatto has a national pedigree to address most legal issues that arise in the business and practice of medicine.