DOJ

Executives in the Crosshairs: DOJ Increases the Focus on Individuals to Combat Corporate Wrongdoing

Posted by Chris Raphaely on September 22, 2015
DOJ / No Comments

shutterstock_205655215-300x250Earlier this month, the Deputy Attorney General of the Department of Justice (“DOJ”) released a memorandum (“Guidance”) setting forth six key steps to which DOJ attorneys should adhere in the investigation of corporate misconduct. At the same time, the Guidance underscores the importance of having corporate compliance policies and procedures that stress individual accountability and provides critical information for any organization that finds itself under investigation by the DOJ.

The overarching theme of the Guidance is that every act of a corporation or other organization is carried out by one or more individuals and that by focusing on individual conduct and holding specific individuals accountable for corporate misconduct when it is found to have occurred, the DOJ will investigate and combat corporate wrongdoing more effectively.  The six key steps contained in the Guidance are as follows:

  • “to qualify for any cooperation credit, corporations must provide to the [DOJ] all relevant facts relating to the individuals responsible for the misconduct;
  • criminal and civil corporate investigations should focus on individuals from the inception of the investigation;
  • criminal and civil attorneys handling corporate investigations should be in routine communication with one another;
  • absent extraordinary circumstances or approved departmental policy, the [DOJ] will not release culpable individuals from civil or criminal liability when resolving a matter with a corporation;
  • [DOJ] attorneys should not resolve matters with a corporation without a clear plan to resolve related individual cases, and should memorialize any declinations as to individuals in such cases; and
  • civil attorneys should consistently focus on individuals as well as the company and evaluate whether to bring suit against an individual based on considerations beyond that individual’s ability to pay.”

The Guidance will apply to matters that are pending as of September 9, 2015 as well as all future DOJ investigations of corporate wrongdoing.

For more information on this Guidance, contact Chris Raphaely, Nicole Martin, or any member of Cozen O’Connor’s Healthcare law team.

Chris Raphaely

Chris Raphaely

R. Christopher Raphaely joined Cozen O'Connor's Philadelphia office in 2014 as co-chair of the Health Care Practice Group. Chris joins the firm from Jefferson Health System, where he served as deputy general counsel and general counsel to the system’s accountable care organization and captive professional liability insurance companies.

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Largest Criminal Health Care Fraud Takedown – 243 Charged and $712 Million in False Billings

Posted by Ryan Blaney on June 18, 2015
DOJ, FBI, Fraud and Abuse, HHS, Hospital, Medicare / No Comments

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On June 18, 2015, HHS Secretary Sylvia M. Burwell and DOJ Attorney General Loretta E. Lynch announced nationwide arrests in Medicare fraud schemes amounting to approximately $712 million in false billings.  Attorney General Lynch described the strike as “the largest criminal health care fraud takedown in the history of the Department of Justice, and it adds to an already remarkable record of enforcement.”

According to the Department of Justice Press Release the takedown was led by the Medicare Fraud Strike Force and resulted in 243 individuals, including 46 doctors, nurses and licensed medical professionals, being charged with Medicare fraud.  This Strike Force targeted false billings for the following services:

  • Home Health
  • Psychotherapy
  • Physical and Occupational Therapy
  • DME
  • Pharmacy Fraud

The nationwide sweep included Florida, Texas, California, Louisiana, New York and Michigan.  Miami was a particular focus with 73 defendants charged and $263 million of false billings for home health, mental health and pharmacy services.

This nationwide sweep involved significant coordination between multiple government enforcement agencies and illustrates the government’s joint efforts to target health care fraud.  Included in the press conference were FBI Director James B. Comey, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Inspector General Daniel R. Levinson of the HHS Office of Inspector General (HHS-OIG) and Deputy Administrator and Director of CMS Center for Program Integrity Dr. Shantanu Agrawal.

Assistant Attorney General Caldwell spoke and emphasized the Criminal Division’s increased focus on Medicare fraud stating,  “Every day, the Criminal Division is more strategic in our approach to prosecuting Medicare Fraud.  We obtain and analyze billing data in real-time.  We target hot spots – areas of the country and the types of health care services where the billing data shows the potential for a high volume of fraud – and we are speeding up our investigations.  By doing this, we are increasingly able to stop schemes at the developmental stage, and to prevent them from spreading to other parts of the country.”

For further information contact Ryan P. Blaney or any member of Cozen O’Connor’s health care team.

Ryan Blaney

Ryan Blaney

Ryan Blaney joined Cozen O'Connor as a member of the firm's Health Law group. Ryan practices in the firm's Washington, D.C., office. He focuses his practice on representing clients in the health care and life sciences industries in a wide range of matters, including health care fraud and abuse, civil and criminal government investigations, qui tam and whistle-blower disputes under the False Claims Act and other federal and state laws and regulations, HIPAA privacy and data security, compliance and transactional services, and antitrust matters.

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Skilled Nursing Facility Reaches Largest Failure of Care Settlement in DOJ History

Posted by J. Nicole Martin on October 13, 2014
DOJ, HHS, Medicaid, Medicare / No Comments

On Friday October 10, 2014, the Department of Justice (DOJ) and the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) jointly announced a $38 million settlement with a skilled nursing facility (SNF), Extendicare Health Services Inc. (Extendicare) and its subsidiary Progressive Step Corporation (ProStep). Extendicare owns and operates 146 SNFs in eleven states. Prostep offers Extendicare residents occupational, physical and speech rehabilitation services.

The settlement stemmed from allegations in two qui tam cases: United States ex rel. Lovvorn v. EHSI, et. al. C.A. 10-1580 (E.D. Pa); and United States ex rel. Gallick et al., v. EHSI et al., C.A. 2:13cv-092 (S.D. Ohio). The allegations were that Extendicare (1) “billed Medicare and Medicaid for materially substandard nursing services that were so deficient that they were effectively worthless”; and (2) “billed Medicare for medically unreasonable and unnecessary rehabilitation therapy services.” Continue reading…

J. Nicole Martin

J. Nicole Martin

J. Nicole Martin is an associate and practices in the Health Care Practice Group. Nicole assists accountable care organizations, health care systems, long term care providers, behavioral and mental health providers, medical device manufacturers, physician practices and pharmacies with their compliance, regulatory and transactional needs. Nicole’s practice includes providing clients with counsel regarding HIPAA/HITECH and state privacy and security laws, data breaches, business associate and covered entity obligations, licensure laws, Medicare, Medicaid and third-party payer matters, medical staff issues, and fraud and abuse laws. Nicole also represents clients undergoing changes of ownership and changes of control, and assists them with the transactional, regulatory and compliance requirements necessary to finalize the transactions.

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We Don’t Need No Intervention: Qui Tam Relator in Omnicare Wins Big Without DOJ

Posted by J. Nicole Martin on July 23, 2014
DOJ, False Claims Act, Whistleblower / No Comments

The United States Department of Justice (DOJ) recently announced the settlement of two qui tam whistleblower lawsuits against Omnicare Inc., the largest nursing home pharmaceutical and pharmacy services vendor in the nation. The suits alleged that Omnicare gave significant discounts to skilled nursing facilities in exchange for lucrative referrals and pharmacy provider contracts. This $124.24 million settlement is the largest ever in a “swapping” case brought under the Anti-Kickback Statute.

In addition to its size, this settlement is noteworthy because DOJ had initially declined to intervene in the underlying suits and relators pursued the claims independently. That go-it-alone decision was so resoundingly vindicated in Omnicare, it is likely that this case will encourage other whistleblowers to follow a similar course of action. Relators have long had the right to continue False Claims Act litigation without governmental participation. DOJ’s decision whether to intervene or not was traditionally (although not explicitly stated) viewed as a reflection of the strength of the whistleblower’s allegations.  With the increase in whistleblower complaints, the limitations on the number of cases that DOJ can put resources on, statutory changes, the rise of a specialized qui tam bar, and big dollar victories like this may significantly increase the number of independent qui tam lawsuits. Continue reading…

J. Nicole Martin

J. Nicole Martin

J. Nicole Martin is an associate and practices in the Health Care Practice Group. Nicole assists accountable care organizations, health care systems, long term care providers, behavioral and mental health providers, medical device manufacturers, physician practices and pharmacies with their compliance, regulatory and transactional needs. Nicole’s practice includes providing clients with counsel regarding HIPAA/HITECH and state privacy and security laws, data breaches, business associate and covered entity obligations, licensure laws, Medicare, Medicaid and third-party payer matters, medical staff issues, and fraud and abuse laws. Nicole also represents clients undergoing changes of ownership and changes of control, and assists them with the transactional, regulatory and compliance requirements necessary to finalize the transactions.

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