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Tag: 2017 News

Jury Convicts Saratoga Doctors

Physicians who practiced at the Campbell Medical Group, Dr. Vilasini Ganesh a family practitioner and Dr. Gregory Belcher an orthopedic surgeon, were convicted of health care fraud by a federal jury after an eight-week jury trial.

The jury found Ganesh, 47, of Saratoga, guilty of five counts of health care fraud and five counts of making false statements relating to claims fraudulently submitted to health care benefit programs. Belcher, 56, also of Saratoga, was found guilty of one count of making a false statement relating to a health care benefit program. The defendants were acquitted of conspiracy and money laundering counts, and Belcher was also acquitted of four other health care fraud counts and one other count of making a false statement relating to a health care benefit program.

Evidence at trial showed that Ganesh submitted false and fraudulent claims to several health care benefit programs for services that she knew were not properly payable, by including claims for days when the patient had not been seen by the provider, and claims that the patients had been seen by another physician provider who was no longer affiliated with her practice.

Evidence at trial further demonstrated that Belcher had on at least one occasion submitted a false claim in connection with a billing matter related to his physical therapy practice.

On July 13, 2017, a federal grand jury indicted the defendants, charging them with one count of conspiracy to commit health care fraud, in violation of 18 U.S.C. § 1349; one count of conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h); and multiple counts health care fraud, in violation of 18 U.S.C. § 1347, and 2 and false statement relating to health care matters, in violation of 18 U.S.C. § 1035.

The indictment alleged that Ganesh would misrepresent, conceal and hide her wrongdoings or direct her subordinates to do as such. When she was approached by representatives from the insurance companies or the patients themselves, for example, to provide documentation or additional information to substantiate the submitted claims, she’d either forbid her office staff from speaking to anyone about the claims or she would just resubmit the false information, according to the DOJ.

She was accused of working with Belcher to submit hundreds of claims for reimbursement from the insurance companies for days that were weekends when their practice was closed, days on which the patients denied they were seen and days when the patients could not have been seen by Ganesh or her staff because either the patient or the doctor was not physically present.

The doctors were suspected of using billing codes that indicated either one of them had spent more than 24 hours in a single day seeing patients. The pair allegedly maintained multiple bank accounts through which they tried to hide their illegally obtained money.

The defendants are currently out of custody, on a $350,000 bond as to Ganesh and a $250,000 bond as to Belcher. Judge Koh scheduled the defendants’ sentencing hearing for April 4, 2018.

Assistant U.S. Attorneys Patrick Delahunty and Jeff Nedrow are prosecuting the case with the assistance of Susan Kreider and Nina Burney Williams. The prosecution is the result of a two-year investigation by the Federal Bureau of Investigation.

Officials Say California is “Wild West” for Recovery Centers

California is “the wild, wild west right now,” said Kansas Cafferty, a commissioner with the National Certification Commission for Addiction Professionals.

In a state with about 1,800 licensed recovery centers and an unknown number of unlicensed sober living homes and testing labs, According to the story in the Orange County Register, Cafferty is among many who believe California needs to get better at rehab regulation. “There (are) a lot of places committing crimes that authorities are trying to enforce, but they can’t keep up with it.”

Marlies Perez, chief of the California Department of Health Care Services’ Substance Use Disorder Compliance Division, which licenses rehab treatment centers, said her agency can only do what the state Legislature allows.

She would not say whether her department needs more authority, or if it is doing a good job protecting consumers.

“We’re not going to quantify our functions,” Perez said. “Our role is to provide oversight. That is, once again, exercise the authority that we have” and work with other regulatory agencies when appropriate.

Carol Sloan, the health department’s spokesperson, said state codes list specific causes for denying a treatment center license. Reasons include prior revocation of a license and failure to comply with fire codes. Other than that, applications from would-be operators and counselors generally aren’t screened by the state.

Drug counselors in California are certified by industry-related agencies to work in recovery programs. And once certified, they’re governed by a code of conduct written by the certifying agency that could make them subject to discipline for such things as sexual misconduct or drug abuse.

But officials and critics say neither the third-party certification organizations, nor the state health services agency, are routinely notified by law enforcement or state officials when treatment center operators or their workers are convicted of crimes or disciplined for license violations.

It’s not a new problem, and California legislators have fought about it for years. Still, they’ve made only halting progress in beefing up licensing standards and rehab monitoring. That’s partly because of industry lobbying, and because of fears that tighter rules will raise treatment costs or limit the number of rehab beds just when the nation’s opioid crisis is cranking up demand.

This year, State Sen. Pat Bates, R-Laguna Niguel, introduced a bill to reform the system, but it stalled in committee. Today, she describes the state’s oversight of rehab operators, sober living homes and counselors as “troubling.”
Senator Pat Bates speaks during a drug overdose awareness memorial at Crown Valley Park in Laguna Niguel earlier this year. (Photo by Drew A. Kelley, Contributing Photographer)

“There is significant resistance – to looking at a (rehab operator’s) background,” Bates said. “There’s a culture about giving these people a second chance.”

Still, she insists that background checks and tougher licensing requirements for counselors, employees and rehab operators are vital. “It’s something we need to pursue.”

Court Has Broad Discretion to Award Restitution in Fraud Case

Michelle Janet Lias was a food services worker with the Corona/Norco Unified School District.  She claimed she sustained an injury to the lower right side of her back on June 11, 2013, when she picked up a box of frozen burritos.

She received total workers’ compensation benefits of $4,450.43 between June 17 and November 12, 2013. An additional $13,740.60 was also paid out for her medical expenses during that period.

On October 12, 18, and 20, 2013, an insurance investigator recorded three clandestine videos of defendant. In those videos, defendant spent an extended amount of time in a car driving, she went to a pumpkin patch event, she bent down and tied her shoes, she walked without a limp, she carried a package to her car, and she sat in a casino gambling.

On November 12, 2013, the defendant’s treating physician changed his opinion after viewing the videos. The physician said defendant was “milking it.” On the same date, he issued a supplemental orthopedic report in which he wrote that defendant was not disabled and should return to work.

Lias pled guilty to fraudulently making a material statement and representation for the purpose of obtaining compensation. (Ins. Code, § 187.14, subd. (a)(4); count 1.) The People filed a request for restitution in an aggregate amount of $45,747.23, itemized as follows: salary payments of $9,902.69, medical expenses of $15,116.60, clandestine investigation in the amount of $7,651.60, photocopying in the amount of $3,050.80, bill review expenses of $1,312.14, defense fees of $5,859.21, and deposition expenses of $2,854.19.

The court granted defendant three years of summary probation and later imposed victim restitution in the amount of $35,525.08. The court denied restitution for photocopying, bill review, and defense fees. On appeal, defendant contends the court abused its discretion in awarding that amount of restitution. The Court of Appeal affirmed the restitution order in the unpublished case of People v Lias.

Generally speaking, restitution awards are vested in the trial court’s discretion and will be disturbed on appeal only when the appellant has shown an abuse of discretion. Even though the trial court has broad discretion in making a restitution award, that discretion is not unlimited. While it is not required to make an order in keeping with the exact amount of loss, the trial court must use a rational method that could reasonably be said to make the victim whole, and may not make an order which is arbitrary or capricious. When there is a factual and rational basis for the amount of restitution ordered by the trial court, no abuse of discretion will be found by the reviewing court.

“Here, the court acted well within its discretion by implicitly determining that defendant had never suffered an injury; thus, its restitutionary award of all wages and medical expenses incurred as a result of defendant’s faked injury is supported by the record. This is regardless of the date reflected in the complaint and in defendant’s plea. Indeed, the clandestine videos showed that defendant had been capable of performing tasks as early as October 12, 2013, that she was reporting to her physician she could not do.”

Mileage Reimbursement Increases to 54.5 Cents

The Internal Revenue Service has announced that the standard mileage rate for business miles will increase 1.0 cents per mile to 54.5 cents per mile as of January 1, 2018.

The California Workers’ Compensation Institute (CWCI) notes that this means the mileage rate that California workers’ compensation claims administrators pay injured workers for travel related to medical treatment or evaluation of their injuries will need to be adjusted to the new IRS rate for travel on or after January 1, 2018, regardless of the date of injury, though the current rate of 53.5 cents per mile rate should be paid for all 2017 travel.

California Labor Code §4600 (e)(2), working in conjunction with Government Code §19820 and Department of Personnel Administration regulations, requires claims administrators to reimburse injured workers for such expenses at the rate adopted by the Director of the Department of Personnel Administration for non-represented (excluded) state employees, which is tied to the IRS published mileage rate.

In a news wire issued December 14, the IRS announced that as of January 1, 2018, the standard mileage rate will increase to 54.5 cents per business mile driven. The IRS bases the standard mileage rate on an annual study of the fixed and variable costs of operating an automobile.

There have been multiple mileage rate changes over the past decade, so the California Division of Workers’ Compensation has posted downloadable mileage-expense forms on the forms section of its website  which show applicable rates based on travel date.

A new form with the 2018 rate is expected to be posted shortly but it should not be used until reimbursements are being made for 2018 travel.

In the meantime, claims organizations should alert their staff and programmers that the rate will increase to 54.5 cents per mile for travel on or after January 1, 2018.

Jury Convicts Ronald Grusd M.D.

Beverly Hills Radiologist Ronald Grusd and two of his corporations, California Imaging Network Medical Group and Willows Consulting Company, were convicted by a federal jury this week of fraud and bribery charges in connection with a massive health care-fraud scheme involving the State of California’s Workers’ Compensation program.

After a seven-day trial, the jury found Dr. Grusd and his companies guilty on all charges facing them, including Conspiracy, Honest Services Mail and Wire Fraud, Health Care Fraud, and Travel Act violations, based on their years-long bribery and fraud scheme.

According to evidence presented at trial, Dr. Grusd and his companies paid kickbacks for patient referrals from multiple clinics in San Diego and Imperial counties in order to fraudulently bill insurance companies over $25 million for medical services. Dr. Grusd negotiated with various individuals, including a primary treating physician, the payment of kickbacks for the referral of workers’ compensation patients for various medical services, including MRIs, ultrasounds, Shockwave treatments, toxicology testing and prescription pain medications.

After the patients were referred for the treatment or service, one of Dr. Grusd’s companies, California Imaging Network Medical Group, would fraudulently bill insurance companies for the procedures, concealing from both the patients and the insurers that substantial kickbacks had been paid in violation of California law. Another of Dr. Grusd’s companies, Willows Consulting Company, funneled the kickback payments to those directing the referral of the patients from the various clinics. Records presented at trial showed that Dr. Grusd paid over one hundred thousand dollars in bribes to secure the billings for hundreds of patients, with bribes paid on a per-patient or per-body-part formula.

Dr. Grusd was ordered to return to federal court on March 12, 2018, for a sentencing hearing for himself as well as both corporations. Since 2009, Dr. Grusd and his various companies have filed tens of thousands of liens in the California Workers Compensation System, seeking reimbursement for hundreds of millions of dollars from multiple insurers. To date, any outstanding liens have been stayed and will be sent to lien consolidation for dismissal proceedings as a result of the convictions.

The jury could not reach a unanimous verdict as to Dr. Grusd’s administrator, Gonzalo Paredes, who was ordered back to court on January 4, 2018, for a hearing regarding a retrial.

Dr. Grusd, Paredes, and the corporations were originally indicted by a federal grand jury in November 2015, when the U.S. Attorney’s Office and the San Diego District Attorney’s Office, working in conjunction with the Federal Bureau of Investigation and the California Department of Insurance, announced multiple arrests arising from “Operation Back Lash” – a long-term, proactive health care fraud investigation targeting corruption and fraud in the California Workers’ Compensation system that is continuing.

Since then, nearly 40 individuals and corporations have been charged with federal and/or state crimes, including doctors, attorneys, marketers and providers of medical services and devices. The four other defendants charged with Dr. Grusd and Paredes – who were alleged to have received bribes in exchange for patient referrals – have pleaded guilty and are cooperating with the continuing investigation while awaiting sentencing. The charges on which Dr. Grusd went to trial were brought in July 2017, when a grand jury returned a Superseding Indictment against him and his companies.

Grusd’s practice, California Imaging Network Medical Group, operated clinics throughout California in San Diego, Los Angeles, Beverly Hills, Fresno, Rialto, Santa Ana, Studio City, Bakersfield, Calexico, East Los Angeles, Lancaster, Victorville and Visalia.

Contractors Fined $147K for Safety Violations

Cal/OSHA has cited three contractors $147,315 for safety violations after investigating the collapse of a temporary mold (formwork) and vertical shoring at an Oakland construction site that sent 13 workers to the hospital.

On May 26, workers at 3039 Broadway, a 435-unit mixed-use project, were pouring concrete into elevated formwork when the shoring system supporting the formwork collapsed. The workers fell some 20 feet along with freshly poured concrete, reinforcing steel, timber framework, and tools and equipment.

Some were able to get to safety on their own and others were assisted by firefighters. When emergency crews arrived, workers were using shovels to dig their colleagues out of the wet concrete.

Oakland Fire Battalion Fire Chief Ian McWhorter, who was still cleaning wet cement off his boots almost four hours later, said earlier the on-site workers “did an excellent job of extricating” their fellow workers before firefighters arrived and took over.

McWhorter said the cement was “kind of like quicksand” and rescuers used plywood and planks to reach trapped workers so they would not sink.

The injured were taken to hospitals for cuts, bruises and strains, but no fatalities or major injuries were reported. One worker’s injuries required surgery.

Cal/OSHA Chief Juliann Sum said that “significant safety lapses caused injuries that could have been much worse if the workers hadn’t landed in freshly poured concrete. Employers must identify, evaluate and correct unsafe working conditions and follow all requirements to prevent employee injuries and illnesses.”

Cal/OSHA’s investigation found that the formwork and vertical shoring system that collapsed were not properly designed, installed or inspected. The agency issued serious and serious accident-related citations to subcontractors Largo Concrete, Inc. and N.M.N. Construction, Inc. for $73,365 and $70,320, respectively, for failure to ensure that the formwork and vertical shoring were designed to safely withstand all intended loads, failure to have calculations and drawings approved by a California registered civil engineer as required for vertical shoring over 14 feet tall, and failure to ensure the shoring supports were erected on a level and stable base. General citations were issued to general contractor Johnstone Moyer, Inc. for $3,630 in proposed penalties.

Cal/OSHA addresses safety requirements for concrete construction and vertical shoring in its Cal/OSHA Pocket Guide for the Construction Industry.

Exclusive Remedy Not Applicable to Employer Assault

Joung Hyen Lee, Hyen Uk Lee, and Esther Lee are former employees of The Christian Herald, Inc., a corporation they allege is solely owned and was managed by their former boss, Jun Yang.

Joung Hyen Lee was a reporter, while Hyen Uk Lee and Esther Lee were administrative assistants. These three plaintiffs filed suit against Yang and the Herald asserting five wage-and-hour claims. Hyen Uk Lee asserted three additional causes of action (assault and battery and intentional infliction of emotional distress against Yang, and premises liability against the Herald) arising out of alleged physical confrontations with Yang.

As to these claims, Hyen Uk Lee alleged that on two occasions in September 2012, Yang physically attacked her. Specifically, on September 13, 2012, Yang threw a cellular phone at her and grabbed her, causing injury to her arm and body. In addition, on September 20, 2012, Yang pushed Hyen Uk Lee against a door, causing her to hit her head on the corner of the door and lose consciousness. As to the tort claims against Yang, Hyen Uk Lee sought compensatory as well as punitive damages.

Yang argued the tort causes of action, assault and battery, and intentional infliction of emotional distress, failed to state a claim because workers’ compensation is the exclusive remedy for injury sustained in the workplace.

As to the two tort claims, the trial court noted Hyen Uk Lee alleged both incidents occurred in the workplace and concluded “the alleged facts do not fall outside of the scope of the exclusive remedy of the workers’ compensation statute. Nor is there an allegation of lack of workers’ compensation insurance as to these causes of action.”

Plaintiffs appeal from the judgment entered in favor of Yang after the trial court sustained his demurrer to the first amended complaint without leave to amend. The Court of Appeal reversed the judgment in part in the unpublished case of Lee v. Yang.

The Court of Appeal reasoned that “the Labor Code provides an employee may sue his or her employer, notwithstanding the exclusive remedy provision of workers’ compensation, ‘[w]here the employee’s injury – is proximately caused by a willful physical assault by the employer.” (§ 3602, subd. (b)(1); see also Soares v. City of Oakland (1992) 9 Cal.App.4th 1822, 1828 – 1829″

“Here, Hyen Uk Lee alleges that on September 13, 2012, Yang threw a cellular phone at her and grabbed her, causing injury to her arm and body. Hyen Uk Lee further alleges that on September 20, 2012, Yang pushed her against a door, causing her to hit her head on the corner of the door and to then lose consciousness. These allegations are sufficient to survive a demurrer on the cause of action for assault and battery.”

California Officials Publish Cell Phone Health Warning

The use of cell phones has increased dramatically in recent years, including among children and young adults. These phones put out radio frequency (RF) energy. Some scientists and public health officials believe RF energy may affect human health.

And now Division of Environmental and Occupational Disease Control of the California Department of Public Health has published a guidance document that lists some of the potential health concerns, and provides guidance on how people can reduce their exposure.  And certainly this may be an issue in future workers’ compensation claims based upon the effects of cell phone use.

The scientific community has not reached a consensus on the risks of cell phone use, but the California health department said research suggests long-term, extensive use may affect health. Although the science is still evolving, some laboratory experiments and human health studies have suggested the possibility that long-term, high use of cell phones may be linked to certain types of cancer and other health effects, including:

– brain cancer and tumors of the acoustic nerve (needed for hearing and maintaining balance) and salivary glands
– lower sperm counts and inactive or less mobile sperm
– headaches and effects on learning and memory, hearing, behavior, and sleep

The Guidance Document concludes that “These studies do not establish the link definitely, however, and scientists disagree about whether cell phones cause these health problems and how great the risks might be. This document is intended to provide guidance for those people who want to reduce their own and their families’ exposures to RF energy from cell phones, despite this uncertainty.”

“We know that simple steps, such as not keeping your phone in your pocket and moving it away from your bed at night, can help reduce exposure for both children and adults,” said Dr. Karen Smith, state public health officer. Smart phones emit radio frequency energy when they send signals to and receive them from cell towers.

About 95 percent of Americans own a cell phone, and 12 percent rely on their smart phones for everyday Internet access, the health department said. In addition, the average age when children get their first phone is now just 10, and a majority of young people keep their phones on or near them most of the day and while they sleep. “Children’s brains develop through the teenage years and may be more affected by cell phone use,” Smith said. “Parents should consider reducing the time their children use cell phones and encourage them to turn the devices off at night.”

Other tips for reducing exposure to radio frequency energy from cell phones: Keeping the phone away from the body, reducing cell phone use when the signal is weak, reducing the use of cell phones to stream audio or video or to download or upload large files, keeping the phone away from the bed at night, removing headsets when not on a call, and avoiding products that claim to block radio frequency energy because they may actually increase your exposure.

Healthcare Analytics Market Projects 27.3% Annual Growth

A new report published by Research and Markets says that the healthcare analytics market is expected to reach $29.84 billion by 2022 up from $8.92 billion in 2017, producing a compound annual growth rate (CAGR) of 27.3%.

Increasing government initiatives to increase EHR adoption, growing pressure to curb healthcare costs, availability of big data in healthcare, increasing venture capital investments, rising focus on improving patient outcomes, and technological advancements are driving the growth of the healthcare analytics market.

On the other hand, factors like the lack of skilled analysts (that limits the use of healthcare solutions), the high cost of these solutions, and operational gaps between payers and providers, are expected to limit the growth of this market to a certain extent.

The healthcare analytics market is segmented into descriptive, predictive, and prescriptive analytics by type.

The prescriptive analytics segment is expected grow at a highest CAGR during the forecast period. The high growth of this segment is attributed to the ability of prescriptive analytics to ensure the synergistic integration of predictions and prescriptions.

Based on application, the healthcare analytics market is segmented into clinical analytics, financial analytics, operational and administrative analytics, and population health analytics.

Financial analytics market is segmented into revenue cycle management; claims processing; payment integrity and fraud, waste, & abuse (FWA); and risk adjustment and risk assessment. Due to the rising focus of payers on the early detection of fraud and reducing preventable costs, the market for fraud analytics is expected to register a significant growth during the forecast period, therefore driving the market for financial analytics.

Based on the component, the healthcare analytics market is segmented into services, software, and hardware.

The services segment accounted for the largest share of the healthcare analytics market in 2016. With the increasing need for business analytics services and the introduction of technologically advanced healthcare analytics software, which requires extensive training to use as well as regular upgrades, the services segment is expected to grow at the highest CAGR during the forecast period.

In 2017, North America is expected to account for the largest share of the market followed by Europe.  Factors such as growing federal healthcare mandates to curb rising healthcare costs and provide quality care; increasing regulatory requirements; growing EHR adoption; and rising government initiatives focusing on personalized medicine, population health management, and value-based reimbursements are expected to drive market growth in North America.

The report provides an overview of the healthcare analytics market. It aims at estimating the market size and future growth potential of this market across different segments such as type, application, component, delivery model, end user, and region.

The report also includes an in-depth competitive analysis of the key players in the market along with their company profiles, recent developments, and key market strategies.

Workers’ Compensation is Highest Risk Sector

According to a new A.M. Best Co. Inc. special report,the U.S. workers compensation industry experienced more financial impairments during a 17-year period from 2000-2016 than any other property/casualty line of business.

Best defines impairments as being situations in which a company has been placed, via court order, into conservation, rehabilitation and/or insolvent liquidation.

Overall, 354 property/casualty insurers became impaired during the study period.

Supervisory actions undertaken by insurance department regulators without court order were not considered impairments for this study unless delays or limitations were placed on policyholder payments, Best said in a statement.

According to the study, the workers compensation sector accounted for 26% of the impairments; commercial lines insurers represented 22% of the impairments, split between other liability/commercial multi-peril at 15% and commercial auto at 7%; and 23% of impairments were split among specialty lines. The remaining sectors accounted for personal lines.

Specific causal factors were identified for 91 of the impairments, with fraud or alleged fraud the leading cause and present in 23 of the impairments, while 21 impairments related primarily to affiliate problems.

Catastrophe losses, largely in Florida and Texas, were responsible for 18 impairments, while 16 companies suffered impairment after experiencing rapid growth, the according to the statement.

Of the 354 impaired companies during the period, 45% were rated by Best at some point during the period between the date of impairment and three prior year-ends.

The study concludes that there has been a significant decline in the number of impairments that Best has been involved in rating in recent years. From 2007-2016, there were 174 U. S. property/casualty impairments, of which 21% were rated by Best at a point during the period between date of impairment and three prior year-ends, compared with 45% for the 2000-2016 period, according to the statement.

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