Tag: 2020 News

What healthcare problems are consuming the largest share of healthcare dollars? Researchers decided to answer that question.

In total, the researchers analyzed 5.9 billion unique insurance claims, 150.4 million ambulance rides, dental procedures, and emergency room visits, 1.5 billion days spent within inpatient or nursing home care, and 5.9 million drug prescriptions. And they just published their results in the Journal of the American Medical Association.

Researchers say that when neck and low back pain are combined with other musculoskeletal disorders, including joint and limb troubles, Americans are spending more for treatment than on any other ailment or condition.

Just how much does that add up to? According to data from 2016, an almost inconceivable $380 billion was spent on spinal issues and joint pain.

In all (individuals, public insurance, private insurance), $3.1 trillion was spent on healthcare in the United States in 2016. That comes out to $9,655 for every U.S. citizen, and roughly 17.9% of the U.S. GDP. For reference on just how high prices have skyrocketed, in 1996, healthcare costs only represented 13.3% of the GDP.

“The vast costs associated with healthcare represent one of the most important and contentious issues facing Americans today,” says Dr. Joseph Dieleman of the Institute for Health Metrics and Evaluation (IHME) at the University of Washington’s School of Medicine and lead author of the study, in a release. “Our study provides comprehensive estimates over a 20-year period that highlight how healthcare and prescription drugs are paid for, what they are spent on, and how such payments have changed over time.”

Of all 154 medical conditions included in this research, just lower back and neck pain alone accumulated the highest expenditures ($134.5 billion). After that, diabetes ($111.2 billion), ischemic heart disease ($89.3 billion), and falls ($87.4 billion) weren’t far behind in terms of costs.

Predictably, the majority of those costs were paid for by insurance providers, both public and private.  Regarding lower back and neck pain; $76.9 billion was paid for by private insurance, and $45.2 billion was paid for by public insurance. Still, that left $12.3 billion that had to come out of someone’s pockets.

Meanwhile, private insurers paid $73.3 billion for other musculoskeletal disorders, public insurers covered $46.9 billion in costs, and $9.7 billion was paid for by individuals out of pocket.

For diabetes, $55.4 billion was paid by public insurance, $49.1 billion by private, and $6.7 billion was paid out of pocket.

How about ischemic heart disease? In all, $48.2 billion was paid for by public insurers, $37.9 billion worth of costs were covered by private insurers, and $3.2 billion was paid by individuals.

Finally, falls tallied a hefty tab as well; $40.7 billion was paid for by public insurance, $34.8 billion was paid for by private insurance, and $11.9 billion was settled out of pocket.

Most of that public insurance spending (58.6%) covered bill accumulated by patients over the age of 65. After adjusting for population and age fluctuations, public insurance spending increased much faster than private insurance. The study’s authors attribute this observation to Medicaid expansions.

Mitchell | Genex, a provider of cost containment technology, clinical services, and disability management, has announced an agreement to acquire Coventry Workers’ Comp Services from CVS Health. Coventry Workers’ Comp Services is a provider of care and cost management programs for workers’ compensation and auto insurance carriers, third-party administrators, and self-insured employers. Coventry Workers’ Comp Services is currently a division of Aetna, a CVS Health company.

With this acquisition, Mitchell | Genex will expand its capabilities, and add Coventry’s leading PPO network to its continuum of care and cost containment offerings.

Peter Madeja, Genex Services President and CEO said  “We are extremely proud and excited about adding another long-standing, reputable organization to the Mitchell | Genex team. This move will expand the breadth of our cutting-edge cost containment technology and clinical services with the deepest understanding of the workers’ compensation industry and will significantly build upon our network offerings. It reinforces our continuous commitment to help clients navigate through today’s challenges and build better outcomes to improve the lives of injured parties.”

Based in Downers Grove, IL, Coventry Workers’ Comp Services has been a full-service managed care organization for more than 35 years. The company brings approximately 2,000 professionals with deep industry expertise, along with a broad suite of services – network, clinical and specialty – powered by technology to enhance network development, clinical integration and operational efficiencies with a focus on total claims cost.

Following the closing of this acquisition, Coventry Workers’ Comp will continue to be led by Art Lynch, President and CEO, and operate under its brand.

“We are very excited to join Mitchell | Genex and further meet the needs of our ever-changing industry,” said Lynch. “This is a forward-thinking partnership that combines one of the most robust PPO networks with an equally positioned firm in cost containment technology and clinical solutions. These capabilities, when combined with artificial intelligence and advanced analytics, will maximize our clients’ performance today and into the future.”

Kramer Levin Naftalis & Frankel LLP and Axinn, Veltrop & Harkrider LLP are acting as legal advisors to Mitchell | Genex. Fried, Frank, Harris, Shriver & Jacobson LLP and Dechert LLP are acting as legal advisors to CVS Health. BofA Securities is acting as exclusive financial advisor to CVS Health.

The acquisition is subject to customary closing conditions, including applicable regulatory approvals. The financial terms of the transaction are not being disclosed.

The Contra Costa County District Attorney’s Office charged 52-years-old Maria Mendoza with numerous counts of insurance fraud. The charges allege four specific instances of workers’ compensation fraud against four different employers, and two additional instances of auto insurance fraud.

The investigation originated after reports of a staged slip and fall in October 2017 at an Olive Garden restaurant located in Pittsburg California. The suspect’s insurance claims history revealed a pattern of short stints of employment followed by claims against the employer.

The first workers’ compensation fraud charge relates to Mendoza’s employment at Pronto Cleaning Services in early 2014. The charge alleges that Mendoza’s employment terminated after only three months of work. She hired a workers’ compensation attorney to file multiple workers compensation claims, including an allegation that her three months of cleaning resulted in cumulative trauma to her hands, wrists, and knees. She and her attorney litigated the claim throughout 2016 and 2017.

The complaint further alleges that Mendoza obtained employment at Architectural Glass & Aluminum Company and worked in a factory setting in late 2014. Her employment terminated there after two months and again a workers’ compensation claim followed. The complaint alleges that she told medical professionals evaluating her that she made no prior claims and is not a party to any civil litigation.

The third workers’ compensation fraud charged relates to employment at Olive Garden. Olive Garden hired Mendoza for work in 2017, but after approximately five months several employees and a manager reported that Mendoza faked a slip and fall on her way to a scheduled disciplinary hearing. She again hired an attorney to file and litigate a workers’ compensation insurance claim for injuries to her knees and ankles from the fall.

The final workers’ compensation fraud charged relates to yet another slip and fall claim at Claim Jumper in 2018. After approximately one month at Claim Jumper Restaurant, Mendoza visited a doctor to report a new slip and fall at work. The complaint again alleges that she falsely told the doctor evaluating her that she never previously filed a workers’ compensation insurance claim.

She is also charged with filing an auto insurance claim alleging an accident in April of 2014. Mendoza claimed the same injuries that she pursued in her workers’ compensation claim against Pronto Cleaning, as well as filing a 2018 auto insurance claim for damage to the same vehicle that her attorney claimed was totaled in the 2014 accident.

A federal grand jury returned a superseding indictment against Robert Rowen and Teresa Su, charging them with conspiracy to defraud the United States. In addition, each defendant also was charged with a separate count of tax evasion.

Robert Rowen, M.D., has been practicing medicine for more than three decades. He graduated Phi Beta Kappa from Johns Hopkins University before attending medical school at the University of California, San Francisco. Terri Su, M.D., has practiced integrative medicine for nearly 40 years. She is a Phi Beta Kappa and summa cum laude graduate of UCLA with a degree in biochemistry. She graduated UC Irvine Medical School in the top quarter of her class. The husband and wife team operate the Rowen Su Clinic in Santa Rosa, serving patients in Sonoma County and the Bay Area.

The medical doctors allegedly conspired to evade payment of Rowen’s federal income tax liabilities by concealing Rowen’s ability to pay his 1992 through 1997 and 2003 through 2008 federal income tax liabilities. Specifically, Rowen and Su allegedly placed his assets out of the reach of the United States Government, placed assets in the names of other persons or entities, deposited Rowen’s revenue into nominee bank accounts, used cash to conduct personal and professional business, converted his revenue into gold and silver coins, and provided false information to the IRS.

The indictment provides a description of various methods the couple allegedly used to conceal Rowen’s income. For example, the indictment describes how the couple instructed patients to make their checks for medical services payable to gold dealers who, in turn, purchased gold and silver coins.

In addition, the indictment alleges Rowen formed a company named Lotus Management LLC to receive revenue from a different company. Rowen then deposited the funds into a bank account opened in the name of Lotus Management LLC, and used the proceeds to purchase gold and silver coins.

Further, the couple allegedly used cash to pay the rent for the medical practice as well as to pay the balance on credit cards used to cover various business and personal expenses.

In sum, the indictment alleges that between January 3, 2007, and April 11, 2014, Rowen, both individually and through nominees, converted over $3,900,000 of his revenue to gold and silver coins. Count one of the superseding indictment charges Rowen and Su with conspiracy to defraud the United States, in violation of 18 U.S.C. § 371, and counts two and three of the superseding indictment charges the defendants each with one count of tax evasion, in violation of 26 U.S.C. § 7201.

The defendants face a maximum sentence of five years imprisonment, and a fine of $250,000, plus restitution. If convicted of tax evasion, the defendant faces a maximum sentence of three years in prison and a $250,000 fine.

The defendants currently are released on a $200,000 bond.

Two owners and operators of a Los Angeles pharmacy were both sentenced to 144 months in prison for their roles in a health care fraud scheme where Medicare and CIGNA were billed more than $11.8 million in fraudulent claims for prescription drugs.

Aleksandr Suris, 51, of Sherman Oaks, California, was sentenced to 144 months in prison by U.S. District Judge S. James Otero of the Central District of California, who also ordered Suris to pay restitution of $11,826,444.65 to Medicare and $17,109.39 to CIGNA. The court ordered Suris to make an immediate partial restitution payment of $500,000.

Maxim Sverdlov, 45, also of Sherman Oaks, was sentenced to 144 months in prison by Judge Otero, who ordered him to pay $11,826,444.65 in restitution to Medicare.  The court ordered Sverdlov to make an immediate partial restitution payment of $500,000.

On Aug. 20, 2019, after an 11-day trial, a jury found Suris guilty of two counts of conspiracy to commit health care fraud, six counts of health care fraud, and one count of conspiracy to commit money laundering.  The jury found Sverdlov guilty of one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.

Suris and Sverdlov were the co-owners and co-operators of Royal Care Pharmacy (Royal Care) in Hollywood. According to the evidence presented at trial, from 2012 to 2015, Suris and Sverdlov fraudulently billed Medicare and CIGNA for prescription medications that Royal Care did not actually purchase or dispense to beneficiaries.  

In order to hide the fraud, Suris and Sverdlov obtained fake drug invoices from co-conspirators to make it appear as if Royal Care had purchased the medicines for which it had billed Medicare and CIGNA, when it actually had not.  Suris and Sverdlov also used these fake invoices to launder the proceeds of the fraud through a co-conspirator.  In total, Suris and Sverdlov submitted more than $11.8 million in bogus claims to Medicare for prescription drugs that they never purchased or dispensed to patients.

This case was investigated by HHS-OIG, the FBI, IRS-CI and the California Department of Justice, and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.  Trial Attorney Robyn N. Pullio and Assistant Chief Daniel J. Griffin of the Fraud Section prosecuted the case.

The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for nearly $19 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.