Retired OIG Special Agent and Advize’s Director of Litigation & FWA Support will be stepping in each week to examine current fraud trends from the lens of an investigator. Stay tuned for weekly insights, updates, and information on healthcare’s most expensive crimes.

This past week, the US Attorney’s Office in the Southern District of NY announced the indictment of an ophthalmologist on a variety of healthcare fraud related charges.  According to the press release, the fraud went on for seven years. The lengthy tenure of this provider’s fraud scheme brings a few questions to mind. Questions like:

Are some frauds preventable? Are all frauds preventable?

I think yes, some are, but there are just so many schemes out there, that it is nearly impossible to stop it all.

My very first case as a new OIG agent involved an ophthalmologist on Staten Island.  This doctor was a prominent doctor on Staten Island, and if any of you know Staten Island, you know it’s a tight community, where people are very entrenched in their community.  The ophthalmologist had a very large practice and did a variety of procedures; everything from cataract surgery to treatments relating to glaucoma. The problem is, the patients did not have glaucoma, nor did they necessarily need the cataract surgery.

The case came to light initially when his billings reflected that he was submitting claims for a study on patients as if they had three eyes.  Yes, you read that correctly.  He submitted claims for a bilateral type of study on the retina, and then billed for a unilateral study.  You can interpret that as either a repeat on the same day, or a third eye.  Of course, in interviewing patients, none of them had a third eye.  As the investigation proceeded, I found several former and current employees who relayed horror stories about the creation of medical records, the use of unlicensed optometrists, the use of prescription anti-depressants before surgery, and a slew of other things.

Curious to learn more about unscrupulous ophthalmologists? Read this Fraud Spotlight article next.

After executing not one, but two separate search warrants at his office, hundreds, if not thousands of altered medical records were discovered.  A search warrant was rendered, and we learned that he was continuing to alter medical records that were the subject of audits, so another search warrant was executed.  When an audit was triggered by anyone (insurer, medical board) this provider would take the chart home, write up new notes, and send the new notes to the requesting entity.  He was kind enough to keep the old notes and a copy of the new notes together in a locked closet in his office.  Records seized during the warrant revealed that his unlicensed optometrist would write the glaucoma test results on a post-it note, so that when the provider got the patient, he could change the pressures to demonstrate elevated readings indicative of glaucoma.  The problem was, the provider was lazy, and most of the time forgot to throw the post it notes away.  He also hired an employee’s child to come in on weekends to go through patient charts to pull the post it notes, but got lazy and did not have the child come on a regular basis.

Unfortunately for many of his patients, they had procedures they likely did not need, or need to the extent and frequency of the services that were provided.  In other instances, it was impossible to determine if patients actually had some of these services, as the battery of things he billed for would have been difficult for the elderly population he treated to properly recall.

In the end, he agreed to a global resolution, which results in resolving criminal and civil liability at the same time.  He paid over $8 million in combined restitution, damages, etc., and got four years in prison.  At the time, it was a huge amount of money, but more importantly, it was satisfying to know he was stopped. This case was and is extremely memorable to me because it was the very first case I investigated and led to such a large resolution.  It was also memorable as I received the OIG Bronze Medal for the investigation. The Bronze Medal is not third place but is the equivalent of Agent of the Year. I had a great mentor while at the OIG, and he taught me well.  He had to transfer the case to me when I got hired, and over 20 years later (and he is long retired) I still remind him of the case he taught me how to work.

Advize Health LLC is a healthcare advisory and consulting company that provides a breadth of healthcare industry services in the payer, provider, and legal communities. Contact Eric Rubenstein for more information on our Fraud Spotlight series.