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| Dear Friend,
It was the nation's largest healthcare fraud bust.
In a move reminiscent of prohibition-era crime fighter Eliot Ness, the U.S. Department of Justice recently announced a coordinated enforcement action against 345 alleged healthcare criminals, including over 100 physicians and other licensed (for now) healthcare professionals, in 51 judicial districts.
The defendants were charged with submitting more than $6 billion in false and fraudulent claims to federal health care programs and private insurers. Of that sum, over $4.5 billion relates to telemedicine, more than $845 million is connected to substance abuse treatment facilities, or “sober homes,” and over $806 million relates to other health care fraud and illegal opioid distribution schemes.
Telemedicine Scheme
Unfortunately, the structure of the telemedicine scheme is one that I’ve seen play out multiple times, sometimes with enough time to avert a client’s participation:
Step 1: Certain defendant telemedicine executives allegedly used
marketing networks to lure unsuspecting “patients” into the scheme via telemarketing, direct mail, TV ads, and internet ads. Call centers confirm Medicare or Medicaid eligibility and transfer the individuals to the telemedicine company.
Step 2. The telemedicine companies controlled by the defendants then allegedly pay defendant doctors and nurse practitioners to order unnecessary durable medical equipment, genetic and other diagnostic testing, and pain medications, either without any patient interaction or with only a brief telephonic conversation with patients they had never met
or seen.
Step 3: The telemedicine defendants then allegedly sell (as in illegal kickbacks and bribes) the physician’s or nurse practitioner’s orders to defendant DME companies, genetic testing laboratories, and pharmacies, which, pursuant to the Government’s allegations, subsequently submitted false and fraudulent claims to Medicare and other government insurers.
Sober Homes Scheme
In connection with the substance abuse treatment facilities (also known as “sober homes” ) scheme, the Government alleged an $845 million scheme of false and fraudulent claims for tests and treatments for drug and/or alcohol addiction.
The defendants include physicians, owners and operators of substance abuse treatment facilities, as well as patient recruiters (AKA “body brokers”) all alleged to have participated
in schemes involving the payment of illegal kickbacks and bribes for the referral of scores
of patients to substance abuse treatment facilities. According to the charges, those patients were subjected to medically unnecessary drug testing – often billing thousands of dollars for
a single test – and therapy sessions that were frequently not provided, and which resulted in millions of dollars of false and fraudulent claims being submitted to private insurers.
It’s also alleged that medical professionals prescribed medically unnecessary controlled substances and other medications to these patients, sometimes to entice them to stay at the facility. The patients were then often discharged and admitted to other treatment facilities, or referred to other laboratories and clinics, in exchange for more kickbacks.
Opioids Scheme
The DOJ’s announcement included charges filed, and guilty pleas obtained, involving more than 240 defendants who allegedly participated in schemes to submit more than $800 million in false and fraudulent claims to Medicare, Medicaid, TRICARE, and private insurance companies for medically unnecessary, and often never provided, treatments involving more than 30 million doses of opioids and other prescription narcotics.
Takeaways for You
1. The first takeaway is one that that I often urge: Just because some other party to a proposed venture tells you that the deal’s been vetted by their lawyers and is “legal,” don’t bet on it. Vet it through your own counsel and assess your own risk. As in carpentry, measure (assess) twice, cut (do the deal) once. Or not do the deal – you get the idea.
2. Government funds spent pursuing healthcare fraud result in a return on investment that Warren Buffett could only dream of. As a result, the federal and state governments will continue to pursue and pursue and pursue potential defendants. Since 2007, the DOJ’s Health Care Fraud Strike Force program had charged more than 4,200 defendants who have collectively billed the Medicare program for approximately $19 billion. And now, according the DOJ’s announcement, they’ve kicked those efforts up a notch or three through the creation of a National Rapid Response Strike Force within that existing program. It’s mission? To investigate and prosecute fraud cases involving major health care providers that operate in multiple jurisdictions.
3. Don’t get swept up (and away, as in put away) by either of those enforcement programs. |
| | | Business Life in the Time of Coronavirus Mini-Series
The coronavirus crisis caused a short term economic crisis for many medical groups. Our mini-series shows you the way out. Plus, many of the concepts discussed are applicable during both good times and bad.
[If you haven't already seen them, follow this link to watch our entire series.] |
| | Watch Tuesday's video here, or just keep reading below for a revised, more polished transcript:
Let’s talk about the “victims” out there, those people who always feel that they are “disrespected.”
Don’t stop reading now! You’re going to hurt my feelings . . . you’re being disrespectful!
I recently read a story about a woman who was on the board of a public hospital. She was called to task for supposedly being “disrespectful” of hospital employees. They wanted her off the board for violating rules of conduct. No disrespect allowed here!
According to the board member and her supporters (it’s a publicly elected board) the whole move against her was political. Maybe it was, maybe it wasn’t.
But what in heck is being “disrespectful”?
Does it mean that you don’t like someone to tell you that you need to do your job (“Oh no, you’ve disrespected me!")? Does it mean that it’s wrong for your boss to call you a f***ing a-hole? Okay we’re probably getting a bit closer now.
The problem with mushy standards like this is that they’re easy to allege, but difficult to prove in the long run. They may, as in the case of the board member, result in a lawsuit.
Look, people are hypersensitized these days. It’s almost as if everyone is a victim. It’s what the evolutionary psychologist Gad Saad calls “victimology poker”.
So, if everyone is a victim and everyone is disrespected, how do you enforce rules prohibiting it? Should you even have them? Aren’t they actually sort of ridiculous?
Often, but certainly not always, these rules start from the right place. Someone thinks they are controlling staff who might act inappropriately. But perhaps more can be achieved by investigating how you train your staff, and how you tell them what’s expected from them. Using definitions that have no definition (“being disrespectful”), only lead to trouble.
Police your own documents. Police your own behavior. Don’t kill your business’s golden goose by attempting to enforce standards that are practically unenforceable. And, I’m not sorry that you feel disrespected by this.
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| | How to Deploy the Secret Sauce of Opportunistic Strategy - Webinar On Demand
They say that COVID-19 has changed the world, creating the "new normal." Many of your colleagues and many hospital administrators are running scared.
Others, leaders like you, know that crisis means opportunity.
Let me provide you with the strategic tools and insights that you need in order to seize opportunities, whether they’re in the context of your current business relationships, the expansion of your business activities, or the creation of new ventures.
You will learn:
•Defense as a defective default: It’s necessary, but not sufficient.
•Exploiting weakness: Drop the guilt and identify opportunity.
•Flat line negotiation is fatal: Understand its myths and limitations.
•Negotiation reality: Learn to identify and deploy on multiple planes to affect the outcome.
•Maneuver: Harness the power of maneuver, both in overall strategy and in specific negotiation strategy.
Others see a crisis and freeze in fear. Learn how to see the opportunities and obtain the tools to increase your odds of obtaining them.
The price to attend is $479. The cost of not attending is astronomical. |
| | | Wednesday - Value and the Price of Not Providing It - Medical Group Minute
Watch the video here, or just keep reading below for a slightly polished transcript:
As I've written before, all across corporate America companies are laying off full-time employees and either replacing them with part-time workers or outsourcing their labor needs to staffing companies. In essence, they are creating a class of "perma-temps" with decreasing job security.
But of course, in healthcare, physicians are rushing to hospital employment and to jobs with large medical groups. Go figure.
The public school system in this country wasn't founded to broadly educate, its purpose was to socialize children, making them good citizens and, even more so, good employees who knew how to show up on time, to do what they were told, and to come back the next day. In return, there was the "promise" of lifetime employment or, at least employment until "retirement" which was not something that was designed for one's "golden years;" rather, it was retirement as in replacement, replacement just like an old machine.
But today, employers reward for the value you create. The factory worker, whether in what is readily recognized as a factory or one which looks, to outsiders, like a medical clinic or hospital, who simply shows up on time, does what he or she is told (you know, follows protocols) and then clocks out at the end of the shift, creates no real value in comparison with the next worker.
As a result, his or her employer will always be seeking someone who will do that job for less.
Today, there's no longer even the "promise" of lifetime employment. "Retirement" as in replacement, replacement just like an old machine, is as far off as the next layoff or the
next outsourcing.
It's creativity and leadership and true value creation, value being measured not by the person delivering it but by the person receiving it, that separates one from the worker bees. Maybe not in the eyes of your current employer – but so what, you're not chained down. You've only been told that you are. Perhaps told so by yourself.
The same dynamic plays out at the medical group level as well. Groups that don't create new value for the parties with whom they contract or interact, from the value that a radiology group provides to a hospital pursuant to an exclusive contract, to the value in a relationship between a surgeon and a referring internist, are angling for replacement.
You're not damaged. You're not victims. Unless you want to be. But that's another story.
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| | | Listen to the podcast here, or just keep reading for the transcript.
A few months ago, while waiting at the gate for a flight, I couldn’t help but notice a gate agent making some woman unpack and repack and unpack and repack her expandable carry-on suitcase because it was too wide to fit into the measuring “box” for carry-on luggage.
It was obvious from the gate agent’s face that she took sublime pleasure in the exercise of her “power.”
When I commented to her a few minutes later that I next expected her to make the woman remove her underwear, she responded, “no one gets on my flight unless I say so.”
The reality is that such mini-dictators, the peons of bureaucracy, are nearly replete of any actual authority. Frustrated by their inability to control their destiny, they act out their near total lack of authority by overcompensating within the one slice of power they have – in this case, the power to drive a woman close to tears because her suitcase had to be pushed into the measuring device instead of sliding right in.
You’ve run into these people. They’re at the DMV and the post office and the TSA.
And, they’re at hospitals: The petty midlevel “executives” who occupy places on an org chart that looks like IBM’s in the 1960’s or a plate of spaghetti. They are the bureaucrats who can say “no,” but who lack any authority to actually say “yes.”
Lord Acton commented that power tends to corrupt, and absolute power corrupts absolutely. It appears that the lack of actual power does the same.
The quiver required to effectively deal with these people includes multiple arrows. Some are polite, others are political, and more than a few are pointed. An effective strategy involves knowing when and how to get the petty bureaucrat to open the gate, when and how to get around him, and when and how to get him pushed out.
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| | | Calibrate Your Compass
Read our exclusive RedPaper to guide you through this evolving situation.
The coronavirus crisis caused a short-term economic crisis for many medical groups. Our RedPaper shows you the way out. Plus, many of the concepts discussed are applicable during both good times and bad.
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| | Help Us Help You With Helpful Content
What tailored content would you most like to see during this
time? How can we focus on solutions to your most pressing strategic concerns?
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| | | | We all hear, and most of us say, that the pace of change in healthcare is quickening. That means that the pace of required decision-making is increasing, too. Unless, that is, you want to take the “default” route. That’s the one is which you let someone else make the decisions that impact you; you’re just along for the ride. Of course, playing a bit part in scripting your own future isn’t the smart route to stardom. But despite your own best intentions, perhaps it’s your medical group’s governance structure that’s holding you back.
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| In fact, it’s very likely that the problem is systemic. The Medical Group Governance Matrix introduces a simple four-quadrant diagnostic tool to help you find out. It then shows you how to use that tool to build your better, more profitable future. Get your free copy Free.
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| | | | | | Whenever you're ready, here are 4 ways I can help you and your business:
1. Download a copy of The Success Prescription. My book, The Success Prescription provides you with a framework for thinking about your success. Download a copy of The Success Prescription here.
2. Be a guest on “Wisdom. Applied. Podcast.” Although most of my podcasts involve me addressing an important point for your success, I’m always looking for guests who’d like to be interviewed about their personal and professional achievements and the lessons learned. Email me if you’re interested in participating.
3. Book me to speak to your group or organization. I’ve spoken at dozens of medical group, healthcare organization, university-sponsored, and private events on many topics such as The Impending Death of Hospitals, the strategic use of OIG Advisory Opinions, medical group governance, and succeeding at negotiations. For more information about a custom presentation for you, drop us a line.
4. If You’re Not Yet a Client, Engage Me to Represent You. If you’re interested in increasing your profit and managing your risk of loss, email me to connect directly. |
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