Healthcare

Report: Cuts, Red Tape, Could 

Drive Historic Healthcare Losses

    WASHINGTON, D.C. — (SPLC) -- 7/28/26 -- A national coalition of nine leading civil rights and healthcare advocacy groups issued a stern warning that record cuts to public health insurance programs and new bureaucratic barriers to enrollment will likely cause historic coverage losses across the United States for years to come.

    The nine organizations released a report outlining comprehensive recommendations for legislators and federal agencies to safeguard civil rights and the health of the American people. The report, Seamless, Accountable and Fair: A Civil Rights Agenda for Reconstructing Insurance Affordability Programs, calls attention to the disproportionate harm that will fall on historically marginalized communities if policymakers do not act. The Congressional Budget Office projects that drastic healthcare cuts under the so-called “One Big Beautiful Bill” Act and the failure to extend Affordable Care Act (ACA) tax credits will cause nearly 15 million people to become uninsured by 2034. The report estimates that 60% of newly uninsured people will come from communities of color.

    “As millions of Americans, including Latinos, struggle with high costs, our leaders must reverse recent cuts and then rebuild our health programs to ensure affordable health coverage for all, regardless of race, ethnicity or ZIP code,” said Janet Murguia, president and CEO, UnidosUS. “Coverage protects family finances, improves health outcomes and saves lives. And in places where nearly everyone has health coverage, a better-funded provider infrastructure lowers costs, while improving healthcare access and quality for the entire community.”

    While calling for the rescission of recent cuts, the report stresses the need to systematically rebuild Medicaid and the ACA marketplace in order to guarantee coverage to eligible families. The organizations say that current cuts to Medicaid and ACA health coverage are only part of what will drive record coverage losses in future years. They warn of new bureaucratic barriers, like more frequent eligibility checks and work requirements that terminate Medicaid when families don’t meet onerous new paperwork demands.

    “On issue after issue — healthcare, SNAP, voting rights and more — the administration and its congressional allies are aggressively erecting unmanageable administrative barriers to deny over-burdened, under-resourced Americans access to critical programs and protections,” said Marc Morial, president and CEO, National Urban League (NUL). “When the time comes to restore and rebuild the country’s healthcare programs, an equally aggressive effort to eliminate administrative burdens will be essential to securing healthcare for families from all backgrounds — but it will be especially important to communities of color, which too often bear the greatest burden when essential services are put out of reach.”

    To bring quality, affordable insurance to everyone in America, without leaving behind people from marginalized communities, the coalition urges three core reforms:

    -- Make healthcare significantly easier for hardworking families to navigate. Eliminate enrollment paperwork for the vast majority of eligible people by automatically qualifying families for health coverage based on their participation in the Supplemental Nutrition Assistance Program and on information already in their tax returns. Create a single eligibility system in each state that includes all health programs, so families don’t have to go from agency to agency looking for insurance. Fund independent consumer assistance programs to help families navigate healthcare complexities.

 -- Hold public programs accountable to the public. Give health agencies the resources needed to provide good customer service. Then set performance standards that limit coverage denials based on arbitrary, poorly understood or onerous procedures. When a state Medicaid agency violates federal law or causes serious and unjustified harm based on race or ethnicity, let injured families go to court to stop the violation.

 -- Treat all people fairly, regardless of race, ethnicity or ZIP code. Offer ACA coverage to adults with incomes below the poverty threshold in states that still refuse to expand Medicaid. That will prevent poor adults from being uninsured simply because of the state where they happen to live. Qualify lawfully present immigrants for health programs without penalizing them when they seek healthcare for their families.

 -- “Healthcare coverage disparities have widened dramatically over the past year, leaving our nation’s most vulnerable communities further behind,” said Juliet K. Choi, president and CEO, Asian & Pacific Islander American Health Forum (APIAHF). “Today, two-thirds of uninsured Americans come from historically underserved communities. Every increase in the coverage gap deepens existing inequities. We must act now to make healthcare more affordable and ensure that every family can access, afford and navigate the care they need.”

 -- The coalition presenting the recommendations reflects the views of civil rights, healthcare and consumer advocacy leaders. It includes the APIAHF, the NAACP, the National Council of Negro Women, the NUL, the Southern Poverty Law Center (SPLC), UnidosUS, the Coalition on Human Needs, Community Catalyst and Families USA.
    

    “America is facing an affordability crisis. Every day, Americans struggle to pay for basic necessities, yet leaders have chosen to cut families off from health insurance lifelines, a cruel and counterintuitive move that undermines the promise to make America a healthier society,” said LaShawn Warren, chief policy officer, SPLC. “Our government has a responsibility to provide everyone in our society access to healthcare and address existing disparities in access. These recommendations offer a practical path forward for lawmakers to ensure every person can access the care or treatment they need without going bankrupt.”

    “The attack on healthcare access is also an attack on civil rights,” said Derrick Johnson, president and CEO, NAACP. “Black Americans are disproportionately harmed when policymakers create barriers that make it harder for eligible families to enroll in or keep health coverage. We have already seen millions lose coverage because of paperwork and bureaucratic obstacles rather than ineligibility. As lawmakers consider the future of our healthcare system, they must reject policies that widen racial disparities and instead build programs that are seamless, accountable and fair for the communities that have too often been left behind.”  --   Date of original release: 7/16/26

Medical Malpractice

Report: Medical Malpractice is Not

A 'Frivolous' Matter

Accusations of Lawsuit Abuse Fall Flat

By Steve Rensberry
RP News

--------------

    EDWARDSVILLE, Ill. - (RP NEWS) - 7/21/2021 - Nearly 10 percent of patients with symptoms caused by major vascular events, infections or cancers will be misdiagnosed in the United States, with more than half of those suffering death or permanent disability as a result. That's the conclusion of a 2020 study by John Hopkins University School of Medicine Director Professor David E. Newman-Toker, along with others involved with the analysis. (1)

    It's a sobering statistic, as are a long list of others involving medical malpractice cited in the latest report by the national consumer organization, Center for Justice and Democracy (CJ&D). See: Medical Malpractice Briefing Book.

    "Among the 15 diseases analyzed, spinal abscesses was the disease most often missed (62.1%). More than one-on-four aortic aneurysms and dissections have a critical delay in diagnosis (27.9%) and more than one in five (22.5%) lung cancer diagnoses are also meaningfully delayed," the John Hopkins study notes.

    Research by the Emergency Care Research Institute (ECRI) in 2020 points to similar results, concluding that "missed and delayed diagnosis" were a top patient safety concern. Diagnostic errors contributing to death were found in about 10 percent of autopsies, they said, leading to 40,000-80,000 deaths annually. Based on outpatient studies, approximately 1 in 20 adults experience a diagnostic error. (2)

More insights from the CJ&D's briefing book:

• Despite the Emergency Medical Treatment and Labor Act (EMTALA), which requires emergency departments to treat emergency patients regardless of ability to pay, hundreds of violations of the Act are seen each year. An analysis of 10 years of EMTALA violations (2008-2018), showed more than 4,300 violations involving 1,682 hospitals, roughly 1/3 of the nation's hospitals. (3)
  

• Approximately 1 in 12 errors involved women who were pregnant or in labor, while 1 in 7 involved people who were having a mental health crisis, including thoughts of suicide. "Yet experts say the raw numbers belie both the scope and severity of the problem they see. That's because enforcement of the law depends on someone filing a complaint. Although anyone can file a complaint, it's most often a doctor, nurse, or hospital administrator," the report notes.

•  A study by Professor Ziad Obermeyer of Harvard Medical School, et al, of early death after discharges from emergency departments, using U.S. insurance claims data, shows a significant number of deaths from people on Medicare soon after discharge. "In this national analysis, we found over 10,000 Medicare beneficiaries each year died within seven days after being discharged from emergency departments, despite mean age of 69 and no obvious life limiting illnesses," the report stated. (4)

•  A 2019 study by University of Michigan School of Public Health candidate Jun Li et al, looked at the amount of data available made available by the U.S. Centers for Medicare and Medicaid Services on 1 million U.S. doctors. Its conclusions: Three quarters of clinicians had no information about their quality of care, 99 percent had no data tied to individual job performance, and lax reporting requirements do not require that every outcome be considered, meaning clinicians may be selective in which cases to submit information on. (5)

• Diagnostic errors are the most common and costly errors, according to an 2020 analysis by Coverys Inc. of data from 2010-2019, with death and high-severity injury making up approximately 52 percent of events and 74 percent of indemnity paid; emergency department-related events accounts for 66 percent of indemnity paid.

    The bottom line, as stated in Part I of the CJ&D's briefing book, is that medical malpractice litigation, and the cases that are filed on account of it, are not fundamentally "frivolous," despite the allegations.

    As stated in the book: "According to averages calculated from the most recent data release by the National Center for State Courts (2019): 1) Medical malpractice cases represented only 0.15 percent of state civil caseloads in 2019. This rate is consistent with NCSC data from the previous seven years. 2) Medical malpractice cases represented only 3.9 percent of state tort caseloads in 2019. This rate is consistent with NCSC data from the previous seven years."

    A 2014 study, "Medical Harm: Patient Perceptions and Follow-up Action," by Johns Hopkins University School of Medicine Professor of Surgery Martin A. Makary and others, showed lawsuits being filed following patient harms in just 1 out of every 5 cases, or 19.9 percent. "This is similar to the Harvard Medical Practice Study, which reported an estimated ratio of adverse event to malpractice claim of 7.6 to 1. Other studies have estimated that as few as 2% - 3 % of patients pursue litigation. These findings all suggest that the vast majority of patient harms never result in a lawsuit." (6)

    The argument that patient lawsuit increase medical and insurance costs also is weak, given the data.

    According to the group Americans for Insurance Reform, claims per physician were at their lowest level in four decades in 2016, when adjusted for medical care inflation. When adjusted according to the Consumer Price Index, claims are at their lowest since 1982. (7)

    “Even aside from COVID-19, the briefing book includes a number of new studies that undercut the medical industry’s principal argument for so-called ‘tort reform’ laws: cost savings. It is clear that health care and insurance costs fail to decrease when ‘tort reforms’ are enacted, meaning there is no reason for patients to lose their legal rights.” CJ&D Executive Director Joanne Doroshow stated in a March 2021 press release.

Citations

1) Medical Liability Monitor (Feb. 2021) "Rate of diagnostic errors and serious misdiagnosis-related harms for major vascular events, infections, and cancers: toward a national incidence estimate using the 'Big Three.'" ECRI Executive Brief, "Top 10 Patient Safety Concerns 2020 (March 2020).

2) ECRI, "Diagnostic Errors: Why Do They Matter, and What Can You Do?" (2019).

3) Brenda Goodman and Andy Miller, "Deprived of Care: When ERs Break the Law," WebMD and Georgia Health News, Nov. 29, 2018.

4) Ziad Obermeyer et al, "Early death after discharge from emergency departments: analysis of national US insurance claim data," BMJ, Feb. 2, 2017.

5) Lena M. Chen, Anup Das and Jun Li, "Assessing the Qualithy of Public Reporting of US Physician Performance," Jame Intern. Med, May 6, 2019; University of Michigan, "System Grading Doctors is Inefficient, Needs Revisions," May 7, 2019; Lisa Rapaport, "U.S. government website for comparing doctors lacks data on most MDs," Reuters, May 6, 2019.

6) Heather G. Lye et al, "Medical Harm: Patient Perceptions and Follow-up Actions," Journal of Patient Safety, November 13, 2014.

7) Americans for Insurance Reform, "Stable Losses/Unstable Rates 2016" (November 2016).

Cyber Security

Report: Healthcare, Manufacturing

Top Targets for Cyber Attacks

    NEW YORK -- (BUSINESS WIRE) -- July 5, 2021 - Avanan, a leader in Cloud Email and Collaboration Security, announced on June 30 the release of the company's 1H 2021 Global Phish Cyber Attack Report, which analyzes today’s threat landscape, phishing vectors, and industry-based attacks, exposing healthcare and manufacturing as two of the top industries being targeted by hackers in the first half of the year.

    “With hospitals around the world being hit with ransomware attacks and manufacturers experiencing supply chain disruption due to cyber-attacks, the Avanan research shows that hackers are using one of the most basic tactics to get in ‒ phishing attacks,” said Gil Friedrich, CEO and Co-Founder of Avanan.

    According to Avanan’s security research and analysis, the most attacked industries are IT, healthcare, and manufacturing. IT saw over 9,000 phishing emails in a one-month span, out of an average of 376,914 total emails; healthcare saw over 6,000 phishing emails out of an average of 451,792 total emails; and manufacturing saw just under 6,000 phishing emails out of an average of 331,184 total emails.

    These industries are the most targeted because they hold incredibly valuable data from health records to social security numbers, combined with the fact that healthcare and manufacturing tend to use outdated tech and often have non-technical board of directors. In healthcare, in particular, the industry is largely unprepared. Though every industry gets attacked, the ones that hold the most data are the most at risk.

    For this report, Avanan security researchers analyzed over 905 million emails spanning a six-month period. Since Avanan works as a layer of security behind Microsoft’s EOP, ATP/Defender, Google Workspace, or any SEGs, this analysis only looks at the emails these other layers did not quarantine. The report reflects an analysis of the most sophisticated and evasive attacks in use today.

    Key Findings:

• Because threats have gotten so advanced, AI is required to stop the majority of attacks missed by legacy solutions. Without the use of sophisticated AI, 51% of attacks would be missed and reach end-users.
• Impersonation and credential harvesting attacks remain top phishing vectors. Credential harvesting, 54% of all phishing attacks, has risen by nearly 15% when compared to 2019; 20.7% of all phishing attacks are Business Email Compromise (BEC); and only 2.2% of phishing attacks are extortion.
• Hackers are starting to target lower-hanging fruit rather than C-level executives. Now, 51.9% of all impersonation emails attempted to impersonate a non-executive in the organization. In fact, non-executives are targeted 77% more often.
• Misconfiguration is playing a rising role in phishing. Over 8% of phishing emails ended up in the user’s inbox simply because of an allow or block list misconfiguration, a 5% increase from last year, and 15.4% of email attacks are on an Allow List.
• The most commonly used tactic is using non-standard characters and limited sender reputation. Non-standard characters are used in 50.6% of phishing links and 84.3% of phishing emails do not have a significant historical reputation with the victim.
  

    Avanan anticipates that cyberattacks will continue to explode with healthcare and education being hit hardest, predicting that attacks on the education sector will surge over the next six months with massive increases when school returns in the fall. In addition, Avanan predicts COVID related phishing emails will decrease, while office place related phishing emails will increase. As workers around the globe return to the office, there will be a spike in phishing attacks leveraging services like fax, scanners, copiers, targeting the things used in office life that sat dormant for the last year and a half.

    For more information and to download the report, please visit: https://www.avanan.com/resources/white-papers/1h-cyber-attack-report.

 

State of Science

 

Trust in Science Soars Amid 

Global Pandemic

 

ST. PAUL, Minn.- (BUSINESS WIRE) - 10/10/2020 - If the world’s biggest challenges are to be solved, science will lead the way.

That’s the takeaway from the annual 3M State of Science Index (SOSI). This year’s survey shows that the image of science is on the rise, sustainable solutions remain critical, barriers to STEM and gender/race inequality must be removed, and public/private partnerships are expected to solve issues that people care most about.

A screenshot from the 3M SOSI site.

“As people face the most challenging health crisis in our lifetime, science is more relevant, more trusted, and more important to people all over the world,” said Mike Roman, chairman of the board and chief executive officer, 3M. “Advocating for science is important to 3M, but it’s bigger than just us. We’re leaning in with a focus on the things people care most about: pandemic preparedness, sustainability, social justice, and STEM equity. The State of Science Index shows that people want and expect science to make lives better and these are important issues that are at the heart of 3M’s vision to improve every life.”

Against the backdrop of COVID-19, trust in science and scientists is the highest it has been in three years since SOSI first began. Today, 89%* of those surveyed trust science; 86%* trust scientists; 77% are more likely as a result of the pandemic to agree that science needs more funding; and more than half (54%*) agree science is very important to their everyday lives – a double-digit increase from the pre-pandemic data (44%*). Rounding out the picture, 92% of global respondents believe actions should follow science to contain the global pandemic, revealing another measure of trust in science.

The evolving image of science is a key theme to emerge from findings of SOSI -- a third party, independently researched study commissioned by 3M to track attitudes towards science. The latest SOSI survey was fielded in eleven countries throughout July and August of 2020, about six months into the global pandemic.

COVID-19 has made people more appreciative of what science can do

A world that has been increasingly skeptical of science seems to be waking up to its relevance and importance. In 2020, rising skepticism reversed for the first time in three years. People who stated, “I am skeptical of science,” dropped by 7 points to 28%* during the pandemic this summer, from its high of 35%* last year. Relatedly, respondents who only believe science that aligns with their personal beliefs is down six percentage points from when the question was first asked in 2018.

A renewed trust in science appears to translate into taking action too: more than half of those surveyed (54%) agree COVID-19 has made them more likely to advocate for science, whereas pre-pandemic data showed only 20% would stand up for science when debating its merits with others.

There is good reason to push for science advocacy because the needle hasn’t moved on everything. Nearly two-thirds (63%) rarely think about the impact science has on their everyday lives—and nearly one-third (32%) still believe their lives “wouldn’t be that different” if science didn’t exist.

Solutions remain critical: science, sustainability and social justice

There are negative consequences to a world that does not value science, according to 82% of those surveyed. When those who agree were asked about the top negative consequences of concern — topping the list of concerns is “a higher risk of health issues” (68%) – which is not surprising in a year dominated by COVID-19. But sustainability remains an important priority too, with “negative environmental impact” (67%) cited as the second most concerning consequence.

Similarly, when asked about issues people most want to solve for, finding a cure for emerging viruses (such as COVID-19) ranks at the top (80%), followed by finding a cure for other major diseases (62%). Outside of healthcare, social justice and the environment are among the greatest priorities. Social justice/STEM equity (advocating for racial equality in society and/or ensuring underrepresented minorities have access to STEM education) is the top non-health related issue (55%) - and addressing the effects of climate change is the second (51%).

But, who will the world count on to resolve these problems people care about in the future? The next generation of scientists, which must be more diverse and better engaged to truly address global challenges.

Race and generational barriers to STEM education threaten future advances

As a result of the pandemic, pro-STEM sentiment is even stronger: today, 74% are more likely to believe that the world needs more people pursuing STEM-related careers to benefit society, while 73% are more likely to believe a strong STEM education is crucial for students.

Unfortunately, too many people have been discouraged from pursuing science, especially younger generations; Gen Z respondents are three times more likely than their boomer counterparts to report being discouraged as K-12 students from pursuing science (28% adult Gen Zers, 24% millennials, 15% Gen X and 9% baby boomers).

The reasons for being discouraged reveal barriers that run deep: More than one-third of discouraged respondents (36%) say it was due to a lack of access to science classes in school, 34% were told they weren’t smart enough, and 27% point to inequalities in gender, race and/or ethnicity as the problem; in the U.S., this issue is especially high, at 50%.

“We’ve learned from this year’s study and from previous years that people want and need science to solve global challenges,” said Dr. Jayshree Seth, corporate scientist and chief science advocate at 3M. “It has never been more important to enable bright, motivated students from all walks of life to reach their full potential and achieve their dreams through careers in STEM,” Dr. Seth continued. “Attracting the next generation of scientists starts with access to education and motivating students to pursue STEM. The science community – and therefore the world – will only benefit from a greater diversity of talent across gender, racial and ethnic lines.”

Businesses and governments have to work together 

The pandemic has uncovered perceived gaps in science leadership around the world, but it has also revealed opportunities to make a difference. A vast majority of survey respondents around the world believe governments need to lead the way -- 86% say governments should be more involved in containing the spread of COVID-19. In the same way, they also look to governments to address challenges such as affordable healthcare (86%), food safety (86%), improving air quality (85%), and ocean plastics pollution (84%).

While governments are deemed the single most responsible organization, a combination of non-government entities emerge as viable partners (corporations, non-profits, and individual citizens) to help address challenges like climate change (48% non-government** vs. 52% government). For racial inequality, respondents are split 52% non-government** vs. 48% government; and for equal access to STEM education for underrepresented minority groups, the split is 38% for non-government** vs. 62% for government.

Importantly, 53% of respondents believe that, amid major challenges in 2020, corporations should prioritize collaborating with governments for solutions to global challenges — second only to preparing for future pandemics (61%).

3M will host a live media briefing and panel discussion on Tuesday October 6th at 2.20pm ET, to talk about the State of Science in 2020, insights behind the findings, and their implications to society with scientists from 3M; the American Association for the Advancement of Science; the UNCF; and the University of Texas at Austin. To register and join the live panel event, please click here.

For more information about the 2020 SOSI Pre-Pandemic and Pandemic Pulse survey results, please visit www.3M.com/scienceindex.

Survey Methodology

3M’s State of Science Index presents two waves of original, independent and nationally representative (based on census demographics) research in 2020, both conducted by global research firm Ipsos through a combination of online and offline interviews.

Pre-Pandemic Wave: The 2020 Pre-Pandemic Survey was conducted in 14 countries among 1,000 general population adults (18+) in each of the following countries: Brazil, Canada, China, Germany, India, Japan, Mexico, Poland, Singapore, South Africa, South Korea, Spain, UK and the US. At the 95% confidence level, the margin of error is +/- 0.83 percentage points at the global, 14-country level and +/- 3.1 percentage points for each individual country.

Pandemic Pulse Wave: The 2020 Pandemic Pulse was conducted among 1,000 general population adults (18+) in 11 of the 14 countries from the 2020 Pre-Pandemic Survey. Countries excluded from this pulse include India, Mexico, and South Africa. At the 95% confidence level, the margin of error is +/- 0.94 points at the 11-country level and +/- 3.1 percentage points for each individual country.

To compare across all years of SOSI, a 9-country tracking average was used which has a margin of error of +/- 1.04 percentage points. Countries within this average include Brazil, Canada, China, Germany, Japan, Poland, Singapore, UK and the US.

2020 Pre-Pandemic survey results were fielded in August - October 2019, and 2020 Pandemic Pulse results were fielded in July - August 2020.

Health Data Exchange Growing, New Study Finds

  (NIH) - 8/10/2013 - New research, published on August 5 in Health Affairs, from the Office of the National Coordinator for Health Information Technology (ONC), shows that health information exchange (HIE) between hospitals and other providers jumped 41 percent between 2008 and 2012.
   The research – authored by National Coordinator for Health Information Technology Farzad Mostashari, M.D., and ONC researchers – indicates that six in 10 hospitals actively exchanged electronic health information with providers and hospitals outside their organization in 2012.
   The research suggests that electronic health records (EHRs) and health information organizations (HIOs) are complementary tools used to enable health information exchange. Stage 2 Meaningful Use, which requires eligible hospitals to exchange with outside organizations using different EHR systems and share summary of care records during transitions of care, can help accelerate hospital use of HIE as a means to enhance care quality and safety.
   “We know that the exchange of health information is integral to the ongoing efforts to transform the nation’s health care system and we will continue to see that grow as more hospitals and other providers adopt and use health IT to improve patient health and care,” said Dr. Mostashari. “Our new research is crystal clear: health information exchange is happening and it is growing. But we still have a long road ahead toward universal interoperability.”
   Highlights of the new study show:
   Fifty eight percent of hospitals exchanged data with providers outside their organization in 2012 and hospitals’ exchanges with other hospitals outside their organization more than doubled during the study period.
   Hospitals with basic EHR systems and participating in HIOs had the highest rates of hospital exchange activity in 2012, regardless of the organizational affiliation of the provider exchanging data or the type of clinical information exchanged.
   The proportion of hospitals that adopted at least a basic EHR and participated in an HIO grew more than five-fold from 2008 to 2012.
   Between 2008 and 2012, there were significant increases in the percent of hospitals exchanging radiology reports, laboratory results, clinical care summaries, and medication lists with hospitals and providers outside of their organization.
   Eighty four percent of hospitals that adopted an EHR and participated in a regional HIO exchanged information with providers outside their organization.
   One area that the research found needs more attention is that of care summaries and medication lists. The research found that only about one-third of hospitals exchanged clinical care summaries or medication lists with outside providers.
   To see state-level estimates for several of the measures included in the new study, visit ONC’s Health IT Adoption and Use dashboard at http://dashboard.healthit.gov/. The abstract of the Health Affairs study can be found athttp://content.healthaffairs.org/content/32/8/1346.abstract .

   Source: U.S. Department of Health and Human Services release.

Health Care Fraud Efforts Recover $4.5 Billion

   WASHINGTON – 3/3/2013 - Attorney General Eric Holder and Health and Human Services (HHS) Secretary Kathleen Sebelius released a new report on February 11 showing that for every dollar spent on health care-related fraud and abuse investigations in the last three years, the government recovered $7.90.
   The government’s health care fraud prevention and enforcement efforts recovered a record $4.2 billion in taxpayer dollars in Fiscal Year (FY) 2012, up from nearly $4.1 billion in FY 2011, from individuals and companies who attempted to defraud federal health programs serving seniors and taxpayers or who sought payments to which they were not entitled. Over the last four years, the administration’s enforcement efforts have recovered $14.9 billion, up from $6.7 billion over the prior four-year period. Since 1997, the HCFAC Program has returned more than $23 billion to the Medicare Trust Funds.
   These findings were released in the annual HCFAC Program report.
   The success of this joint Department of Justice and HHS effort was made possible by the Health Care Fraud Prevention and Enforcement Action Team (HEAT), created in 2009 to prevent fraud, waste and abuse in the Medicare and Medicaid programs and to crack down on individuals and entities that are abusing the system and costing American taxpayers billions of dollars. These efforts to reduce fraud will continue to improve with new tools and resources provided by the Affordable Care Act.
   “This was a record-breaking year for the Departments of Justice and Health and Human Services in our collaborative effort to crack down on health care fraud and protect valuable taxpayer dollars,” Holder said. “In the past fiscal year, our relentless pursuit of health care fraud resulted in the disruption of an array of sophisticated fraud schemes and the recovery of more taxpayer dollars than ever before. This report demonstrates our serious commitment to prosecuting health care fraud and safeguarding our world-class health care programs from abuse.”
   About $4.2 billion stolen or otherwise improperly obtained from federal health care programs was recovered and returned to the Medicare Trust Funds, the Treasury and others in FY 2012. This is an unprecedented achievement for the HCFAC Program, a joint Justice Department and HHS effort to coordinate federal, state and local law enforcement activities to fight health care fraud and abuse, officials said.
   The administration is also using tools authorized by the Affordable Care Act to fight fraud, including enhanced screenings and enrollment requirements, increased data sharing across the government, expanded recovery efforts for overpayments and greater oversight of private insurance abuses.
   Since 2009, the Justice Department and HHS have improved their coordination through HEAT and increased the number of Medicare Fraud Strike Force teams to nine. The Justice Department’s enforcement of the civil False Claims Act and the Federal Food, Drug and Cosmetic Act have produced similar record-breaking results. These combined efforts coordinated under HEAT have expanded local partnerships and helped educate Medicare beneficiaries about how to protect themselves against fraud. In FY 2012, the two departments continued their series of regional fraud prevention summits, and the Justice Department hosted a training conference for federal prosecutors, FBI agents, HHS Office of Inspector General agents and others.
   The strike force teams use advanced data analysis techniques to identify high-billing levels in health care fraud hot spots so that inter-agency teams can target emerging or migrating schemes as well as with chronic fraud by criminals masquerading as health care providers or suppliers. In July, Attorney General Holder and Secretary Sebelius announced the launch of a ground-breaking partnership among the federal government, state officials, leading private health insurance organizations and other health care anti-fraud groups to share information and best practices to improve detection of and prevent payments to scams that cut across public and private payers.
   In FY 2012, the Justice Department opened 1,131 new criminal health care fraud investigations involving 2,148 potential defendants, and a total of 826 defendants were convicted of health care fraud-related crimes during the year. The department also opened 885 new civil investigations.
  The strike force coordinated a takedown in May 2012 that involved the highest number of false Medicare billings in the history of the strike force program. The takedown involved 107 individuals, including doctors and nurses, in seven cities, who were charged for their alleged participation in Medicare fraud schemes, involving about $452 million in false billings. As a part of the May 2012 takedown, HHS also suspended or took other administrative action against 52 providers using authority under the health care law to suspend payments until an investigation is complete.
   Strike force operations in the nine cities where teams are based resulted in 117 indictments, charges and complaints against 278 defendants who allegedly billed Medicare more than $1.5 billion in fraudulent schemes. In FY 2012, 251 guilty pleas and 13 jury trials were litigated, with guilty verdicts against 29 defendants, in strike force cases. The average prison sentence in these cases was more than 48 months.
   The new authorities under the Affordable Care Act granted to HHS and the Centers for Medicare & Medicaid Services (CMS) were instrumental in clamping down on fraudulent activity in health care. In FY 2012, CMS began the process of screening all 1.5 million Medicare-enrolled providers through the new Automated Provider Screening system that quickly identifies ineligible and potentially fraudulent providers and suppliers prior to enrollment or revalidation to verify the data. As a result, nearly 150,000 ineligible providers have already been eliminated from Medicare’s billing system.
  CMS also established the Command Center to improve health care-related fraud detection and investigation, drive innovation and help reduce fraud and improper payments in Medicare and Medicaid.
   From May 2011 through the end of 2012, more than 400,000 providers were subject to the new screening requirements and nearly 150,000 lost the ability to bill the Medicare program due to the Affordable Care Act requirements and other proactive initiatives.
   The Department of Justice and HHS also continued their successes in civil health care fraud enforcement during FY 2012. The Justice Department’s Civil Division Fraud Section, with their colleagues in U.S. Attorneys’ offices throughout the country, obtained settlements and judgments of more than $3 billion in FY 2012 under the False Claims Act (FCA). These matters included unlawful pricing by pharmaceutical manufacturers, illegal marketing of medical devices and pharmaceutical products for uses not approved by the Food and Drug Administration, Medicare fraud by hospitals and other institutional providers, and violations of laws against self-referrals and kickbacks.

   This marked the third year in a row that more than $2 billion has been recovered in FCA health care matters. Additionally, the Civil Division’s Consumer Protection Branch, working with U.S. Attorneys’ offices, obtained nearly $1.5 billion in fines and forfeitures, and obtained 14 convictions in matters pursued under the Federal Food, Drug and Cosmetic Act.
  The HCFAC annual report is available at www.oig.hhs.gov/publications/hcfac.asp. For more information on the joint DOJ-HHS Strike Force activities, visit: www.StopMedicareFraud.gov/.

Uncertainty Remains Factor in Healthcare Reform

   ORANGE, Calif. - (BUSINESS WIRE) - 1-24-2013 - Uncertainty surrounding the impact of healthcare reform is the No. 1 issue health insurance consumers will face in 2013, an expert in the field said recently
   “Individuals and small groups have a lot of questions regarding what reform really means, what insurance rates will look like, and how public and private exchanges are going to work,” said Gregg Ratkovic, senior vice president of Word & Brown’s individual division. “They are hopeful that reform will lead to easier access, more choice and greater affordability; but in reality there are more questions than there are answers.”
   Ratkovic says that among the questions consumers are asking most often are what kind of coverage will be sold through health insurance exchanges, how to obtain insurance if you have a pre-existing condition, and who should consider a high-deductible plan. Other commonly asked questions include how will access to the physicians and hospitals be impacted, will rates be going up or down, and how easy will it be to buy insurance under healthcare reform?
   Surrounded by this uncertainty, Ratkovic says that consumers and small business owners should turn to independent health insurance brokers who can provide the unbiased information needed to make intelligent health insurance decisions. “Brokers can also ease individuals through the enrollment process and can work with their clients to take advantage of the incredible online tools and technology that can help with an informed insurance selection.”
   Among the tools Ratkovic says are most effective are HealthCompare (www.healthcompare.com), which provides consumers with easy access to hundreds of plans online and leads shoppers through the process to help find the right health insurance plan at the right price. For those on Medicare Joppel (www.joppel.com) is a CMS-approved quoting engine designed to help brokers and seniors easily evaluate, compare and enroll in Medicare Advantage (Medicare Part C) health plans, Medigap (Medicare Supplement) plans and Prescription Drug (Part D) coverage. Through Joppel individuals on Medicare can view all of their options side by side and go through a simple needs assessment that narrows down hundreds of plans through criteria that are specific to them – such as what medications are covered, cost of co-payment and plan premiums.
   “There’s a lot of noise in the marketplace, and consumers are looking for help in making sense of it all,” Ratkovic said. “By working with brokers and leveraging the right tools, consumers can take the guesswork out of their insurance selection and lessen the uncertainty that’s inherent in these times of change.”
   Operating nationally, The Word & Brown Companies include the Word & Brown General Agency, with divisions focused on group, Medicare, individual and family insurance coverage; CONEXIS, the nation’s first outsourcing provider to offer benefits administration on a single, Web-based, fully integrated system; CHOICE Administrators, the nation’s leading developer and distributor of health insurance exchange programs; Quotit Corporation, the foremost national provider of Internet sales and marketing solutions for the health insurance and employee benefits industry; and HealthCompare and Joppel by HealthCompare, which help individuals, families and seniors easily research, compare, buy and enroll in the right health insurance or Medicare Advantage, Medigap or Prescription Drug plan at the right price. The Word & Brown Companies have built strong relationships with partners across the country – including more than 50,000 brokers and hundreds of health plans through which they provide benefits and service to approximately 60,000 employers with nearly 6.5 million eligible employees and hundreds of thousands of consumers nationwide. For more information about the firm, visit www.wordandbrowncompanies.com.

Charges Filed in $97 Million Medicare Fraud Case

   (USDOJ) - July 31/2012 - A superseding indictment was unsealed on July 26 charging two owners of a Houston mental health care company, Spectrum Care P.A., some of its employees and the owners of Houston group care homes for their alleged participation in a $97 million Medicare fraud scheme, according to a joint announcement by the Department of Justice, the Department of Health and Human Services (HHS) and the FBI.
    Mansour Sanjar, 79, Cyrus Sajadi, 64, and Chandra Nunn, 34, were originally charged in December 2011, and are expected to make their initial appearances on the superseding indictment in the coming days. The indictment was originally returned on July 24.
    Adam Main, 31, Shokoufeh Hakimi, 65, Sharonda Holmes, 38, and Shawn Manney, 50, all from the Houston area, were arrested and were expected to make their initial appearances in U.S. District Court for the Southern District of Texas in Houston on July 26 or 27.
   The superseding indictment charges Sanjar, Sajadi, Main, Terry Wade Moore, 51, Hakimi and Nunn each with one count of conspiracy to commit health care fraud; Sanjar, Sajadi, Main and Moore are charged with various counts of health care fraud; Sanjar, Sajadi, Hakimi, Nunn, Holmes and Manney each are charged with one count of conspiracy to defraud the United States and to pay health care kickbacks; and Sanjar, Sajadi, Hakimi, Nunn, Holmes and Manney are charged with various counts of payment and receipt of healthcare kickbacks. The superseding indictment also seeks forfeiture.
    According to the indictment, Sanjar and Sajadi orchestrated and executed a scheme to defraud Medicare beginning in 2006 and continuing until their arrest in December 2011. Sanjar and Sajadi owned Spectrum, which purportedly provided partial hospitalization program (PHP) services. A PHP is a form of intensive outpatient treatment for severe mental illness. The Medicare beneficiaries for whom Spectrum billed Medicare for PHP services did not qualify for or need PHP services. Sanjar, Sajadi, Main and Moore signed admission documents and progress notes certifying that patients qualified for PHP services, when in fact, the patients did not qualify for or need PHP services. Sanjar and Sajadi also billed Medicare for PHP services when the beneficiaries were actually watching movies, coloring and playing games – activities that are not covered by Medicare.
    Sanjar, Sajadi and Hakimi paid kickbacks to Nunn, Holmes, Manney and other group care home operators and patient recruiters in exchange for delivering ineligible Medicare beneficiaries to Spectrum, according to the indictment. In some cases, the patients received a portion of those kickbacks. The indictment alleges that Spectrum billed Medicare for approximately $97 million in services that were not medically necessary and, in some cases, not provided.
   The charges were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; Special Agent in Charge Stephen L. Morris of the FBI’s Houston Field Office; Special Agent in Charge Mike Fields of the Dallas Regional Office of HHS’s Office of the Inspector General (HHS-OIG), the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU); Joseph J. Del Favero, Special Agent in Charge of the Chicago Field Office of the Railroad Retirement Board, Office of Inspector General (RRB-OIG); and Scott Rezendes, Special Agent in Charge of Field Operations of the Office of Personnel Management, Office of Inspector General (OPM-OIG).
   An indictment is merely a formal accusation. Defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
    The case is being prosecuted by Trial Attorneys Laura M.K. Cordova and Allan J. Medina and Deputy Chief Sam S. Sheldon of the Criminal Division’s Fraud Section with assistance from Trial Attorneys Jennifer Ambuehl and Aixa Maldonado-Quinones of the Criminal Division’s Asset Forfeiture and Money Laundering Section. The case was investigated by the FBI, HHS-OIG, MFCU, RRB-OIG and OPM-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas.
    Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,330 defendants who have collectively billed the Medicare program for more than $4 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
   Source: www.stopfraud.gov/

Health Reform Law Extends Coverage for 50,000

   WASHINGTON - (BUSINESS WIRE) - 2/25/2012 - Health and Human Services Secretary Kathleen Sebelius announced on February 23 that the new health care law’s Pre-Existing Condition Insurance Plan (PCIP) program is providing insurance to nearly 50,000 people with high-risk pre-existing conditions nationwide. The Department released a new report demonstrating how PCIP is helping to fill a void in the insurance market for consumers with pre-existing conditions who are denied insurance coverage and are ineligible for Medicare or Medicaid coverage.
   “For too long, Americans with pre-existing conditions were locked out of the health care system and their health suffered,” HHS Secretary Kathleen Sebelius said. “Thanks to health reform, our most vulnerable Americans across the country have the care they need.”
   Under the Affordable Care Act, in 2014, insurers will be prohibited from denying coverage to any American with a pre-existing condition. Until then, the PCIP program will continue to provide enrollees with affordable insurance coverage.
    PCIP is helping individuals like:
    Gail O’Brien of Keene, New Hampshire who is now getting help with non-Hodgkin’s lymphoma treatments and is responding very well.
    James Howard of Katy, Texas who is grateful for the coverage the PCIP program is providing to treat cancer and says that without it, he would not have been able to continue receiving care.
    In many cases, PCIP participants have been diagnosed with and need treatment for serious health care conditions such as cancer, ischemic heart disease, degenerative bone diseases and hemophilia. As a result of the new law, PCIP enrollees are receiving health services for their conditions on the first day their insurance coverage begins. Their critical need for treatment, combined with their lack of prior health coverage has led to higher overall per-member claims costs in state-based PCIPs of approximately $29,000 per year, which is more than double the per member cost that traditional State High Risk Pools have experienced in recent years.
    Enrollment in PCIP has seen a nearly 400 percent increase from November 2010 to November 2011. PCIP enrollment is anticipated to trend upwards of 50,000 enrollees within the coming month.
    People who enroll in the PCIP program are not charged a higher premium because of their medical condition. Program participants pay comparable premium rates to healthy people in the individual insurance market. By law, premiums may vary only on the basis of age, geographic area and tobacco use.
    PCIP provides comprehensive health coverage, including primary and specialty care, hospital care, prescription drugs, home health and hospice care, skilled nursing care, preventive health and maternity care. The program is available in 50 states and the District of Columbia and open to U.S. citizens and people who reside in the U.S. legally (regardless of income) who have been without insurance coverage for at least six months, and have a pre-existing condition, or have been denied health insurance coverage because of a health condition.
    The Affordable Care Act directed the Secretary of HHS to carry out PCIP either directly or through a contract with a state or nonprofit entity. In 27 states, a state or nonprofit entity elected to administer PCIP, while HHS operates the program in the remaining 23 states and the District of Columbia.
    The new report can be found at: http://www.cciio.cms.gov/resources/files/Files2/02242012/pcip-annual-report.pdf
    For more information, including eligibility, plan benefits and rates, as well as information on how to apply, visit www.pcip.gov and click on “Find Your State.” Then select your state from a map of the United States or from the drop-down menu.
    The PCIP call center is open from 8 a.m. to 11 p.m. Eastern Time. Call toll-free 1-866-717-582.

Health Care Fraud Effort Saves Taxpayers Billions

   WASHINGTON -  2/22/2012 - Attorney General Eric Holder and Department of Health and Human Services (HHS) Secretary Kathleen Sebelius on February 14 released a new report showing that the government’s health care fraud prevention and enforcement efforts recovered nearly $4.1 billion in taxpayer dollars in fiscal year (FY) 2011. This is the highest annual amount ever recovered from individuals and companies who attempted to defraud seniors and taxpayers or who sought payments to which they were not entitled.
   These findings, released today in the annual Health Care Fraud and Abuse Control Program (HCFAC) report, are a result of President Obama making the elimination of fraud, waste, and abuse a top priority in his administration. The success of this joint Department of Justice and HHS effort would not have been possible without the Health Care Fraud Prevention & Enforcement Action Team (HEAT), created in 2009 to prevent fraud, waste and abuse in the Medicare and Medicaid programs, and to crack down on the fraud perpetrators who are abusing the system and costing American taxpayers billions of dollars. These efforts to reduce fraud will continue to improve with the new tools and resources provided by the Affordable Care Act.
   “This report reflects unprecedented successes by the Departments of Justice and Health and Human Services in aggressively preventing and combating health care fraud, safeguarding precious taxpayer dollars and ensuring the strength of our essential health care programs,” said Attorney General Holder. “We can all be proud of what’s been achieved in the last fiscal year by the department’s prosecutors, analysts and investigators—and by our partners at HHS. These efforts reflect a strong, ongoing commitment to fiscal accountability and to helping the American people at a time when budgets are tight.”
   “Fighting fraud is one of our top priorities and we have recovered an unprecedented number of taxpayer dollars,” Sebelius said. “Our efforts strengthen the integrity of our health care programs, and meet the President’s call for a return to American values that ensure everyone gets a fair shot, everyone does their fair share, and everyone plays by the same rules.”
   Approximately $4.1 billion stolen or otherwise improperly obtained from federal health care programs was recovered and returned to the Medicare Trust Funds, the Treasury and others in FY 2011. This is an unprecedented achievement for HCFAC, a joint effort of the two departments to coordinate federal, state and local law enforcement activities to fight health care fraud and abuse.
   The recently enacted Affordable Care Act provides additional tools and resources to help fight fraud that will help boost these efforts, including an additional $350 million for HCFAC activities. The administration is already using tools authorized by the Affordable Care Act, including enhanced screenings and enrollment requirements, increased data sharing across government, expanded overpayment recovery efforts, and greater oversight of private insurance abuses.
   Since 2009, the Departments of Justice and HHS have enhanced their coordination through HEAT and have increased the number of Medicare Fraud Strike Force teams. During FY 2011, HEAT and the Medicare Fraud Strike Force expanded local partnerships and helped educate Medicare beneficiaries about how to protect themselves against fraud. The departments hosted a series of regional fraud prevention summits around the country, provided free compliance training for providers and other stakeholders and sent letters to state attorneys general urging them to work with HHS and federal, state and local law enforcement officials to mount a substantial outreach campaign to educate seniors and other Medicare beneficiaries about how to prevent scams and fraud.
   In FY 2011, the total number of cities with strike force prosecution teams was increased to nine, all of which have teams of investigators and prosecutors from the Justice Department, the FBI and the HHS Office of Inspector General, dedicated to fighting fraud. The strike force teams use advanced data analysis techniques to identify high-billing levels in health care fraud hot spots so that interagency teams can target emerging or migrating schemes along with chronic fraud by criminals masquerading as health care providers or suppliers. In FY 2011, strike force operations charged a record number of 323 defendants, who allegedly collectively billed the Medicare program more than $1 billion. Strike force teams secured 172 guilty pleas, convicted 26 defendants at trial and sentenced 175 defendants to prison. The average prison sentence in strike force cases in FY 2011 was more than 47 months.
   Including strike force matters, federal prosecutors filed criminal charges against a total of 1,430 defendants for health care fraud related crimes. This is the highest number of health care fraud defendants charged in a single year in the department’s history. Including strike force matters, a total of 743 defendants were convicted for health care fraud-related crimes during the year.
   In criminal matters involving the pharmaceutical and device manufacturing industry, the department obtained 21 criminal convictions and $1.3 billion in criminal fines, forfeitures, restitution and disgorgement under the Food, Drug and Cosmetic Act. These matters included the illegal marketing of medical devices and pharmaceutical products for uses not approved by the Food and Drug Administration (FDA) or the distribution of products that failed to conform to the strength, purity or quality required by the FDA.
   The departments also continued their successes in civil health care fraud enforcement during FY 2011. Approximately $2.4 billion was recovered through civil health care fraud cases brought under the False Claims Act (FCA). These matters included unlawful pricing by pharmaceutical manufacturers, illegal marketing of medical devices and pharmaceutical products for uses not approved by the FDA, Medicare fraud by hospitals and other institutional providers, and violations of laws against self-referrals and kickbacks. This marked the second year in a row that more than $2 billion has been recovered in FCA health care matters and, since January 2009, the department has used the False Claims Act to recover more than $6.6 billion in federal health care dollars.
   The fraud prevention and enforcement report announced today coincides with the announcement of a proposed rule from the Centers for Medicare and Medicaid Services aimed at recollecting overpayments in the Medicare program. Before the Affordable Care Act, providers and suppliers did not face a deadline for returning taxpayers’ money. Thanks to the Affordable Care Act, there will be a specific timeframe by which self-identified overpayments must be returned. The Obama Administration has made prevention and recollection of overpayments a government-wide priority. These announcements today are just the latest in a series of steps that the administration is taking to protect taxpayer dollars and keep money in the pockets of Americans.
   The HCFAC annual report can be found here, oig.hhs.gov/publications/hcfac.asp. For more information on the joint DOJ-HHS Strike Force activities, visit: www.StopMedicareFraud.gov/.
   Source: U.S. Department of Justice national release

Health Care Software Executives Headed to Prison

Pair Defrauded Clients, Investors of More Than $93 Million
CHICAGO – 2/16/2012 - Two co-founders of Canopy Financial Inc., a bankrupt health care transaction software company based in Chicago, have been sentenced to 15 and 13 years in prison for defrauding investors and clients of more than $93 million. Anthony Banas, Canopy’s chief technology officer, was sentenced on Feb. 15 to 160 months in prison, while Jeremy Blackburn, Canopy’s former president and chief operating officer, was sentenced on Jan. 24 to 180 months in prison. Both men pleaded guilty in late 2010 to one count of wire fraud, admitting they engaged in a fraud scheme that cheated investors of approximately $75 million and also misappropriated more than $18 million from customer accounts intended for health care savings and expenses.
    The sentences, imposed by U.S. District Judge Ruben Castillo in federal court, were announced by Patrick J. Fitzgerald, U.S. Attorney for the Northern District of Illinois; Robert D. Grant, Special Agent-in-Charge of the Chicago Office of the FBI; and James Vanderberg, Special Agent-in-Charge of the U.S. Department of Labor Office of Inspector General in Chicago. The Securities and Exchange Commission’s Chicago Regional Office assisted in the investigation.
    In imposing sentence on both defendants, Judge Castillo noted that this case was the most aggravated financial fraud he had seen in his 18 years on the federal bench. The judge ordered both men to pay mandatory restitution and forfeiture totaling $93,125,918. Approximately $50 million has been recovered so far through Canopy’s bankruptcy proceedings, and the government anticipates that the bankruptcy trustee will pay the claims of the health savings account customers. Banas, 34, of Homer Glen, Ill., was ordered to begin serving his sentence on April 18. Blackburn, 38, of Bolingbrook, Ill., was ordered to report to prison on March 20.
    According to court documents, Blackburn and Banas used false information about Canopy’s financial condition, including a bogus auditor’s report and falsified bank statements, to fraudulently obtain approximately $75 million from several private equity investors in 2009. Approximately $39 million of that money was used to redeem shares of other Canopy investors, including approximately $1.6 million that went to Blackburn and $975,000 that went to Banas, while another $29 million obtained from investors was deposited into Canopy operating accounts. Blackburn and Banas also misappropriated Canopy operating funds for their own benefit.
    Blackburn alone took approximately $6 million in unauthorized withdrawals and transfers from Canopy bank accounts during 2009. Blackburn typically directed a Canopy employee, or occasionally Banas, to transfer Canopy funds to his bank accounts or to pay for his personal expenses, including credit card balances, luxury car purchases and funding his account with a private jet company. Among Blackburn’s luxury car purchases with Canopy funds were the following: two 2010 Range Rover SUVs, a 2009 Bentley, a 2008 Lamborghini, a 2010 Lamborghini, a 2009 Rolls Royce Phantom, a 2009 Aston Martin DBS, a 2009 Bentley Continental and a 2009 Ferrari 430. Blackburn also paid for personal home renovations, bought sports tickets and purchased jewelry and watches using misappropriated Canopy funds.
   Banas used misappropriated Canopy money to invest $300,000 in a nightclub. Banas also spent $400,000 between 2007 and 2009 on other personal expenses.
    Blackburn admitted that he created phony bank statements during 2009 to conceal the transfer of more than $18 million from special health care accounts in which Canopy held funds as custodian for the benefit of more than 1,600 clients and customers to make payments to medical providers. The funds were transferred to Canopy’s own operating accounts, as well as to benefit Blackburn and Banas personally.
    In 2004, Blackburn, Banas and a third individual co-founded Canopy, which reportedly was one of the country’s fastest-growing privately-held companies before it entered bankruptcy proceedings in November 2009. Canopy, which had offices in Chicago, Plainsboro, N.J., and San Francisco, developed and marketed software programs for banks and health care payers to administer and process payments involving health-related savings and spending accounts. Canopy’s products related to expense tracking, online bill payment and claims processing for health care transactions.
    Beginning in March 2009, in connection with the offer and sale of Series D preferred stock by Canopy, Blackburn and Banas made materially false representations to prospective investors about Canopy’s financial condition, including its revenues, profitability and total number of client accounts, and falsely represented to prospective investors that its financial statements had been audited by KPMG, the international network of audit, tax and consulting firms.
    In addition to the phony audit report, Blackburn and Banas created falsified bank statements for the months of January through June 2009, purporting to show a Canopy account at Northern Trust Bank with monthly balances ranging between $5.7 million and $8.9 million. Blackburn admitted that these misrepresentations caused certain investors, including entities affiliated with Spectrum Equity Investors, to invest a total of nearly $75 million in shares of Canopy preferred stock in July and August 2009.
    The government was represented by Assistant U.S. Attorneys Stephanie Zimdahl and Manish Shah.
   Source: Financial Fraud Enforcement Task Force

Prosecutors Charge 91 With Medicare Fraud

False billings by medical professionals allegedly total $295 million
   WASHINGTON, D.C. - 9/18/2011 - Attorney General Eric Holder and Health and Human Services (HHS) Secretary Kathleen Sebelius announced on Sept. 7 that a nationwide takedown by Medicare Fraud Strike Force operations in eight cities has resulted in charges against 91 defendants, including doctors, nurses, and other medical professionals, for their alleged participation in Medicare fraud schemes involving approximately $295 million in false billing.
   Attorney General Holder and Secretary Sebelius were joined in the announcement by FBI Executive Assistant Director Shawn Henry, Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and HHS Inspector General Daniel R. Levinson.
   As part of a coordinated action, 70 individuals were charged by Strike Force prosecutors in indictments unsealed on Sept. 6 and on Sept. 7 in six cities alleging a variety of Medicare fraud schemes involving approximately $263.6 million in false billings. As part of takedown operations, 18 additional defendants were charged in Detroit and one defendant was charged in Miami in cases unsealed on Sept. 1 for their alleged roles in Medicare fraud schemes involving approximately $29.4 million in fraudulent claims.
   Additionally, two individuals were scheduled to appear in court on Sept. 7 on charges filed on Aug. 24  for their roles in a separate $2 million health care fraud scheme. This coordinated takedown involved the highest amount of false Medicare billings in a single takedown in Strike Force history.
  The joint Department of Justice-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state, and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. Over the course of the previous week, approximately 400 law enforcement agents from the FBI, HHS-Office of Inspector General (HHS-OIG), multiple Medicaid Fraud Control Units, and other state and local law enforcement agencies participated in the takedown. In addition to making arrests, agents also executed 18 search warrants in connection with ongoing strike force investigations.
   “The defendants charged in this takedown are accused of stealing precious taxpayer resources and defrauding Medicare – jeopardizing the integrity of our health care system and our nation’s most critical health care program for personal gain,” Holder said. “Our highly coordinated, nationwide Strike Force operations are working aggressively to combat Medicare fraud and our anti-health care fraud efforts have never been more innovative, collaborative, aggressive – or effective. We will continue to work with our law enforcement partners and partners across government to fight against health care fraud.”
   The defendants charged are accused of various health care fraud-related crimes, including conspiracy to defraud the Medicare program, health care fraud, violations of the anti-kickback statutes and money laundering. The charges are based on a variety of alleged fraud schemes involving various medical treatments and services such as home health care, physical and occupational therapy, mental health services, psychotherapy, and durable medical equipment (DME).
   According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare for treatments that were medically unnecessary and oftentimes never provided. In many cases, indictments and complaints allege that patient recruiters, Medicare beneficiaries and other co-conspirators were paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could submit fraudulent billing to Medicare for services that were medically unnecessary or never provided. Collectively, the doctors, nurses, medical professionals, health care company owners and others charged in the indictments and complaints are accused of conspiring to submit a total of approximately $295 million in fraudulent billing.
   “As charged in these indictments, the defendants cover nearly the entire spectrum of health care providers, and perpetrated a variety of fraudulent schemes,” said Assistant Attorney General Breuer. “From Brooklyn to Miami to Los Angeles, the defendants allegedly treated the Medicare program like a personal piggy bank. Today’s Strike Force operations should serve as a wake-up call to would-be fraudsters nationwide. With Strike Force teams now in nine cities across the country, and employing sophisticated, data-driven law enforcement methods, we are determined to hold criminally responsible those who defraud Medicare.”
   In Miami, 45 defendants, including one doctor and one nurse, were charged Sept. 6-7 for their participation in various fraud schemes involving a total of $159 million in false billings for home health care, mental health services, occupational and physical therapy, DME, and HIV infusion. Another defendant in Miami was charged on Sept. 1 for a $1 million Medicare fraud scheme. In one case, 24 defendants are charged for participating in a community mental health center fraud scheme involving more than $50 million in fraudulent billing. According to court documents, the defendants allegedly paid patient recruiters to refer ineligible beneficiaries to the mental health center. In some instances, beneficiaries who were residents of halfway houses were allegedly threatened with eviction if they did not agree to attend the mental health center.
   “The warning should be unambiguously clear by now,” said HHS Inspector General Levinson. “We will continue using the combined law enforcement might of Strike Forces around the country to combat health care fraud.”
   In Houston, two individuals were charged today with fraud schemes involving $62 million in false billings for home health care and DME. According to an indictment, one defendant allegedly sold beneficiary information to 100 different Houston-area home health care agencies in exchange for illegal payments. The indictment alleges that the home agencies then used the beneficiary information to bill Medicare for services that were unnecessary or never provided.
   Ten defendants were charged in Baton Rouge, La., for participating in schemes involving more than $24 million related to false claims for home health care and DME. According to one indictment, a doctor, nurse, and five other co-conspirators participated in a scheme to bill Medicare for more than $19 million in skilled nursing and other home health services that were medically unnecessary or never provided.
   Six defendants, including two doctors, were charged in Los Angeles for their roles in schemes to defraud Medicare of more than $10.7 million. In Brooklyn, three defendants, including two doctors, were charged for a fraud scheme involving more than $3.4 million in false claims for medically unnecessary physical therapy. Two defendants, including a doctor, are making initial appearances today in U.S. federal court in Dallas after being charged for a scheme to defraud Medicare of approximately $2.1 million.
   In Detroit, 18 defendants, including three doctors, were charged last week for schemes to defraud Medicare of more than $28 million. According to an indictment, 14 of the defendants participated in a home health care scheme that submitted more than $14 million in false claims to Medicare.
   Finally, four defendants including one doctor, were charged in Chicago for their alleged roles in schemes to defraud Medicare of more than $4.4 million.
   The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.
   Since their inception in March 2007, Strike Force operations in nine locations have charged more than 1,140 defendants who collectively have falsely billed the Medicare program for more than $2.9 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
   The cases announced on Sept. 7 are being prosecuted and investigated by Medicare Fraud Strike Force teams comprised of attorneys from the Fraud Section of the Justice Department’s Criminal Division and from the U.S. Attorney’s Offices for the Southern District of Florida, the Eastern District of Michigan, the Eastern District of New York, the Southern District of Texas, the Central District of California, the Middle District of Louisiana; the Northern District of Illinois, and the Northern District of Texas; and agents from the FBI, HHS-OIG, and state Medicaid Fraud Control Units.
   Source: U.S. Federal Bureau of Investigation release. For more information, see www.stopmedicarefraud.gov.

Healthcare Cost Index Reveals Pricing Disparities

   BRENTWOOD, Tenn.- (BUSINESS WIRE)- 6/30/2011 - Cost associated with health care imaging services have ballooned over the past decade, accounting for nearly 15 percent – or $100 billion – of the annual health care spend in the U.S. This quarter’s Healthcare Transparency Index from change:healthcare reveals cost disparities of CT and PET scans, MRIs, ultrasounds and mammograms across and within four key regions – highlighting key opportunities for cost transparency to enable patients and employers to save money on local imaging services.
   The Index found that patients who participate in consumer-directed health plans (CDHPs), and high-deductible plans, could be paying almost 700 percent more than they have to for imaging services simply because they don’t have access to critical healthcare pricing information. Individuals can save up to $2,000 on just one of the more expensive imaging services by comparing costs among facilities and selecting more affordable options. This has huge implications for employers who could cut an average of 30 percent off their imaging bill each year – shaving significant costs off what is considered a “big-ticket item” for payers and employers.
   The Index reveals an employer with 15,000 employees could save half a million dollars each year. Backed by claims data from more than 150,000 patients enrolled in employer-provided health plans in more than 200 companies across all 50 states, the findings underscore the central role that actionable cost transparency plays in reducing healthcare costs.
   The Index uncovered significant pricing disparities for the most widely prescribed imaging services at outpatient facilities, freestanding imaging centers and medical offices both from region to region and within the same region:

• CT Scans: With more than 70 million CT scans performed each year in the U.S., the Index revealed an average of 40 percent possible savings across all regions for patients receiving the three most frequent CT scans (abdomen without contrast, abdomen with contrast, pelvis with contrast) – just by shopping local facilities. The greatest savings potential existed in the Southwest where a patient could pay up to 683 percent more for the same CT scan. However, patients in the Midwest who saw lower variances still paid an extra $290, or 120 percent.
• MRI: The Index revealed a 25 percent average savings potential across all regions studied for patients receiving the three most frequent MRIs (lower extremity, brain and lumbar spine) by shopping local facilities. Patients receiving the same MRI in the same area of the Southeast could pay a high of $2,500 and a low of $560.
• Ultrasound: For all regions, shopping local facilities can yield a 28 percent savings for patients receiving the three most frequent ultrasounds (breast, abdomen and transvaginal) by shopping local facilities. The highest price of an ultrasound reported was $700 for an abdominal examination, where the low price in the same area was $120. With an average of three ultrasounds performed per patient just for pregnancy, cost savings to patients and employers are significant.
• PET Scans: Generally one of the priciest items in imaging, the Index found that patients across the U.S. could save an average of 36 percent by comparing prices. The reported cost in the Northeast ranged from $3,500 to $4,500, while patients in the Midwest paid a maximum of only $2,500 and a minimum as low as $1,400.
• Mammography: The Index reveals that patients could save an average of 17 percent on mammography services per year by switching providers. With roughly 37 million mammograms performed each year and this number expected to rise with the aging U.S. population, insight into actual pricing and options for care could ultimately drive down costs for all of these routine services.

    “Because of a lack of cost information available, employers and their employees are spending billions needlessly nationwide for common, high-tech and low-tech imaging procedures when they could choose much more cost-effective choices in their own areas,” said Howard McLure, change:healthcare chairman and CEO. “This Healthcare Transparency Index demonstrates how making informed decisions around just one major line item in healthcare – in this case, imaging services – can not only save patients and employers money, but also make a significant impact on the nation’s overall healthcare spend.”

Survey: Employee health benefit costs on the rise

   CHICAGO - (BUSINESS WIRE) - 4/28/2011 - The cost of claims in employer-sponsored health plans continues to increase, according to a recent trend survey by Wells Fargo Insurance Services. Although the rate is slightly lower than six months ago, the survey found overall claim cost will continue to increase in the low double-digits.
    “Our survey results show that employers continue to seek sophisticated ways to manage employee health risk, stretch their employee benefit dollars and minimize costs”
   With more than 60 insurance companies participating, the nationwide survey was conducted between February and March 2011. Reflecting claim activity over a six-month period, projected increases in the national average cost of claims include:

• Health maintenance organizations (HMO) and point-of-sale plans (POS) - 9.6 percent increase
• Preferred provider organizations (PPO) and consumer driven health plans (CDHP) - 10 percent increase
• Exclusive provider organizations (EPO) – 10.6 percent increase
• Indemnity plans – 11.1 percent increase
• Prescription plans - 8.7 increase

   Dan Gowen, senior vice president of Wells Fargo Insurance Services, said the continued cost increase suggests employer premiums will rise at a similar rate, as insurance companies anticipate costs based on claim trends.
   “Our survey results show that employers continue to seek sophisticated ways to manage employee health risk, stretch their employee benefit dollars and minimize costs,” said Gowen. “That’s especially true as insurers expect higher claim costs as a result of market changes brought on by federal healthcare reform.”
   The survey found that, in addition to healthcare reform provisions, claim cost is influenced by increased use of healthcare services, aging U.S. population, improvements in medical technology and drug therapies, use of specialty drugs to treat complex diseases, changes in provider treatment patterns, and inflation. Finally, in comparison to the prior six months, the survey also showed dental and vision benefit products remain stable.
   Wells Fargo Insurance services has conducted this biannual survey since 2008. The company will open its next survey in late summer 2011.

APS Healthcare to Pay $13 Million in Claims Case

   ATLANTA — 2/22/2011 — The United States Attorney’s Office announced today that “Innovative Resources Group, LLC,” doing business as “APS Healthcare Midwest,” of White Plains, New York, has reached a $13 million settlement with the United States and the state of Georgia to resolve allegations under the False Claims Act. The United States’ share of the settlement is $5.2 million.
   The government alleges that APS Healthcare submitted false claims to Medicaid through the Georgia Department of Community Health (DCH) because it did not provide specialty services related to disease management and case management to members of the Georgia Medicaid Management Program (GAMMP) during the period from Sept. 1, 2007 through Feb. 28, 2010.
   “In this time of tight budgets and rising health care costs, the state of Georgia tried to improve its services to its Medicaid recipients by contracting with APS Healthcare. But instead of providing improved efficiency and effectiveness the company billed for, APS Healthcare took Medicaid’s money for itself and left some of our most vulnerable citizens without the aid they deserved,” United States Attorney Sally Quillian Yates said.
   Under the GAMMP contract, APS Healthcare agreed to provide case and disease management services to Georgia Medicaid recipients and was paid a monthly fee for each member receiving such services. The government contends that APS Healthcare failed to provide the required services to a large portion of the Medicaid recipients and over-billed the Georgia Department of Community Health in its monthly invoices.
   APS Healthcare has executed a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services, Office of Inspector General, which will require an aggressive compliance program. The Corporate Integrity Agreement requires, among other things, intensive training and implementation of policies and procedures designed to ensure compliance with federal health care program requirements. In addition, APS Healthcare will be subject to external review of its compliance with state Medicaid contracts.
   If APS Healthcare fails to comply with certain material terms of the CIA, the company is subject to monetary penalties and exclusion from federal health care programs, including Medicare and Medicaid.
   The civil settlement resolves a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the United States and share in any recovery. The case, pending in the Northern District of Georgia, is filed under United States ex rel. Michael Claeys and State of Georgia ex rel. Michael Claeys v. APS Healthcare, Inc., APS Healthcare Bethesda, Inc., and Innovative Resource Group, LLC d/b/a/ APS Healthcare Midwest, 1:09-cv-2779-WSD.
   The investigation was conducted by special agents of the FBI and HHS-OIG.
   The civil settlement was reached by Assistant United States Attorneys Christopher J. Huber and Lena Amanti.
   Source: U.S. Department of Justice news release.