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.

A provider in Michigan is pleading guilty to Medicare-related fraud for reusing rectal devices.  Yes, you read that correctly. Even in the current state of affairs, Medicare fraud continues to be a pervasive problem, and can always take a new twist on how the unscrupulous provider seeks to game the program for increased financial benefit. Feel free to read the article and be forewarned that there is a percentage of providers that do not have the best interests of a patient in mind.

This provider, a urologist, used single-use devices that are intended to identify the ability to hold urine within the bladder muscles. This is a great example of how amoral providers do not need to create new schemes but can just recirculate the same schemes in a slightly different way. I hold this akin to the fact that the circus may be different, but the clowns are always doing the same tricks. This scheme is reminiscent of an investigation I was involved in that included not only the provider (also a urologist), but his billing manager as well. 

Labib Riachi, an OB/GYN and his billing manager, both ran afoul of federal healthcare fraud statutes. The billing manager, Susan Toy, entered into a Civil Monetary Penalties Law (CMPL) agreement to pay $250,000 in damages for having caused false claims to be submitted to the Medicare program. She submitted claims on behalf of Riachi for a variety of physical therapy services that were related to studies that were similar to the fraud perpetrated by the Michigan provider. Riachi’s case involved his purported continual use of the testing that required the use of the device that was part of the Michigan fraud case. 

Riachi had purportedly conducted this particular test on each of his patients at each visit. The test, which is traditionally conducted at the initial visit, and at the conclusion of a prescribed period of physical therapy (to strengthen the muscles that prevent urinary and fecal incontinence), can identify if the physical therapy provided the corrective action needed. The probes are single-use for a variety of reasons, the least of which is infection control. Other institutions and providers (if you recall Olympus entered into a large settlement with the US Attorney’s Office for their inability to design a device that could be adequately cleaned and prevent infection-there was much more to this case) have also run afoul by using the same equipment repeatedly. 

As I have commented before, a penny wise but a pound foolish. In an attempt to save some money on the front end, but having to pay dearly in the long run, is just not only bad business, but can and will eventually get the provider in trouble. We oftentimes do not know the background on how a provider came to the attention of the OIG and law enforcement (and often times it is an ethical employee), but the “cream rises to the top.” It is often just a matter of time until someone identifies that there is a problem, and the provider to whom they complain, allows the complaint to fall on deaf ears. 

I have always been of the position that being an unscrupulous provider is a much more difficult task than just being honest and working within the guidelines. Fraudulent providers need to constantly be working to cover their fraud, work to continue to perpetuate the fraud, and maintain some legitimacy to their practice. At the same time, this same provider needs to keep the level of knowledge to a minimum, to keep the fraud contained. As they say in the Mob, the best secrets among two people, is when one is no longer living. This is a near impossibility, as ill-intentioned providers need their staff and assistants to keep the fraud moving. 

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.