Life Altering Experience

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It takes a lot of guts to be a whistleblower. The decision to stand up for what is right and attempt to fix what is wrong can be a risky proposition and a life-altering experience. (Setting all risk aside, blowing the whistle on illegal activities can also be financially rewarding.) An article published in the South Florida Business Journal tells about how the former chief financial officer (CFO) of a skilled nursing facility in South Florida stopped an alleged kickback scheme from bilking Medicare, and as a result of his efforts was rewarded with several million dollars.

The story reports that the former CFO filed a lawsuit against a senior care facility where he worked, alleging the company paid doctors to be pseudo medical directors in exchange for Medicare patient referrals. (If allegations are true, this is a huge violation of the federal Anti-Kickback Statute which prohibits the offer, solicitation or acceptance of anything of value in exchange for referrals to federal health care program business.) The former CFO also alleged that the company, which was founded 60 years ago, improperly billed both Medicare and Medicaid using false records to back up the claims.

Apparently, several company officials were accused of being involved in the scheme to defraud the health care benefits program. The story states that the lawsuit alleged the company’s executives and board of directors, including a past chairman, helped to carry out the scheme. (The former CEO of a Miami Beach hospital disqualified from participating in Medicare and Medicaid because of improper billing practices was also the executive director of the skilled nursing facility. Now isn’t that interesting?)

The lawsuit alleges that the senior home company, which operates seven centers, billed Medicare for nearly $130 million over a three-year period of time. Former employees, including the president, executive director and CFO all agreed to settle the case for $17 million without admitting findings. (Note that this is the largest settlement ever paid by a skilled nursing facility in the United States.) The CFO will receive $4.25 million from the settlement.

While the former CFO’s honesty paid off with a monetary reward, it looks like the people allegedly responsible for the acts got off pretty easy. (They are lucky they did not receive a life altering prison sentence.) Congratulations to the Federal Bureau of Investigation, the U.S. Attorney’s Office and the Department of Health and Human Services: their efforts ensure that deserving Medicare beneficiaries will receive the level of care that they deserve in the future.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Miami Senior Facility Settles Medicare Fraud Charges for $17M,” written by Nina Lincoff and published by the South Florida Business Journal on June 16, 2015.

Plaza Health Network in Miami has settled Medicare fraud charges for $17 million, reportedly the largest settlement for alleged kickbacks paid by a skilled nursing facility in the U.S.

The senior home, formerly known as Hebrew Homes Health Network, settled the charges Monday. The company, founded 60 years ago, operates seven centers throughout South Florida.

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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.