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It’s no secret that the healthcare industry has a widespread problem with billing fraud. (Today’s article fits into that category.) The perpetrator, who is from Morristown, New Jersey, used improper billing practices to commit Medicaid fraud. The occupational therapist made false statements about his juvenile patients in more than 7,000 instances for the purpose of making more money.

Court documents show that many of his patients sought treatment through contracts with two county school systems. His fraudulent billing practices that allowed him to amass nearly $400,000, included submitting claims for individual counseling sessions even though a patient was treated in a group setting. He instructed his staff to submit bills using the national provider identity of a credentialed therapist who no longer worked for him. (Sometimes, the services at the doctor’s practice were provided by non-credentialed therapists.)

In several instances, he provided speech therapy for Latino children. When one of his speech therapists confronted him stating that the children didn’t have an impediment, they just didn’t speak English. When his administrative assistant questioned his billing codes, the doctor explained he was authorizing the use of the wrong code because he wanted to make more money. (You can’t get more blatant than that.)

The former occupational therapist pleaded guilty to one count of healthcare fraud. The sentence recommended for his crime is an 18-month stint in federal prison. In addition, the doctor agreed to pay $200,000 to TennCare, Tennessee’s Medicaid program, and two private health insurance companies. Further research shows that the fraudster retired his license to practice occupational therapy with the Tennessee Department of Health as a consequence of his illegal acts. He was also allowed to live with his sister in New York while working off his $200,000 debt to the government before he is sentenced. (That was certainly nice of the judicial system to allow that.)

This case is a perfect example of what people will do when they know that they won’t face a substantial penalty for their fraudulent actions. Even though the doctor’s defense attorney tried to show that the man had a good reputation in the community, his criminal acts prove otherwise. It looks like the good old days of making more money at the expense of innocent victims is over for this fraudster. (Let’s hope the judge makes sure that message gets through when sentenced.)

Today’s “Fraud of the Day” is based on an article entitled, “Unqualified staff used therapist IDs 7,000 times in Tennessee,” published by Insurance Fraud News on September 20, 2017.

September 20, 2017, Morristown, TN — Assistant U.S. Attorney David L. Gunn on Tuesday recommended 18 months in federal prison for Dr. Penaranda Tan, who owned Therapeutic Services of Morristown and pleaded guilty to a single count of health-care fraud, according to court documents.

Tan, who has agreed to pay $200,000 in restitution to TennCare, Medicare and two private health insurance companies. He’s scheduled to be sentenced in federal court in Greeneville on Sept. 27. Tan’s fraudulent billing netted him nearly $400,000, according to Gunn.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.