Medicare Compliance & Reimbursement

Even though we’re just one month into 2023, healthcare fraud cases are already stacking up. And enforcement activity shows that fraudsters continue to push the envelope with their creative ways to defraud the government.

Embezzlement: A Hyannis, Massachusetts-based provider could face prison time for a variety of issues from mail and wire fraud to hiding insurance checks in a secret account to embezzlement. Dentist Jack Massarsky, who also worked as a bookkeeper at his practice, kept a secret bank account and “intercepted insurance reimbursement checks sent to the dentistry practice in the mail and deposited those checks in the secret bank account,” a Department of Justice (DOJ) release indicates. From 2015 to 2021, he managed to embezzle upward of $1.2 million, using the funds for personal expenses.

But it doesn’t stop there. Massarsky submitted fraudulent applications for CARES Act Provider Relief Fund (PRF) payments in the name of his employer, too. He pocketed another $52,000 in PRF payments and added that to his cache in the secret account.

He’s scheduled for sentencing in May and could be fined more than $250,000, face more than 20 years of prison time, and more.

Racketeering: A trio of brothers and their co-consipirators were charged in a massive 42-count fraud case that included charges under the Racketeering Influenced and Corrupt Organizations Act (RICO), which are uncommon in the federal healthcare space. “Multiple dental practice owners and co-conspirators were charged in the Eastern District of Pennsylvania for allegedly engaging in a multifaceted racketeering conspiracy through a multi-state network of dental practices and related dental businesses,” a DOJ release expounds.

Brothers Bhaskar, Niranjan, and Arun Savani “were allegedly part of a wide-ranging scheme to defraud Medicaid, U.S. Immigration authorities, the IRS, and the Food and Drug Administration (FDA), and to launder the fraud proceeds” through both the Savani Group dental practices and companies, DOJ says. Top charges include tax evasion, trying to hire foreign workers for jobs they aren’t trained for and concealing that from the feds, engaging in a scheme to profit from false Medicaid contracts, and sell misbranded dental devices.

A total of 12 individuals have been charged, including four dentists and a practice manager. “If convicted, Bhaskar, Arun and Niranjan Savani, respectively, face a statutory maximum sentence of 430 years’ imprisonment, 425 years’ imprisonment, and 115 years’ imprisonment,” DOJ cautions.

Other fraud: Though the cases above are outliers, the feds’ January enforcement highlights the importance of covering all your bases and following the rules. Check out these three cases that show that Medicare fraud comes in all shapes and sizes.

• Medical collection services: Gabriella Santibanez and Lisa Hazard operated the Sacramento, California-based mobile phlebotomy company PhlebXpress Inc., and billed Medicare for services that weren’t reimbursable. Between 2015 and 2020, Santibanez and Hazard falsely billed Medicare for more than $7.5 million, while claiming that the services were provided to Medicare beneficiaries through a different company. Both pled guilty and could face up to 10 years in prison and significant fines; sentencing is scheduled for May 2023.
• Drug diversion: After his medical license and DEA registration had been revoked, a certified nurse practitioner Larry J. Goisse, Jr. continued to prescribe Adderall — and billed Medicare for the office visits under a co-worker’s credentials. Groisse pleaded guilty and was sentenced to two years in prison and three additional years of supervised release.
• Medically unnecessary cataract surgery: Conyers, Georgia-based ophthalmologist Aarti D. Pandya violated the False Claims Act and will settle the allegations by paying the feds $1.85 million. From 2011 to 2016, Pandaya billed Medicare “for cataract surgeries and diagnostic tests that were not medically necessary, tests that were incomplete or of worthless value, and office visits that did not provide the level of service claimed,” a DOJ releases says.