Florida Practice Pays $24.5M to Resolve False Claims Act Violations

Florida-based Physicians Partners of America (PPOA) has reached a $24.5 million settlement to resolve healthcare fraud allegations that it violated the False Claims Act and billed federal healthcare programs for unnecessary medical testing and services.

PPOA founder Rodolfo Gari and former chief medical officer Abraham Rivera are also liable for the settlement amount, along with PPOA affiliated entities, including the Florida Pain Relief Group, the Texas Pain Relief Group, Physician Partners of American CRNA Holdings LLC, Medical Tox Labs LLC, and Medical DNA Labs LLC.

The US Department of Justice (DOJ) alleged that PPOA submitted claims to federal healthcare programs for medically unnecessary urine drug testing.

According to the case, PPOA required its physician employees to order multiple tests simultaneously without reviewing initial test results to determine if the additional testing was reasonable or needed. The health system’s affiliated toxicology lab then billed federal healthcare programs for the highest level of urine drug testing

DOJ claimed that in exchange for ordering fraudulent urine drug tests, PPOA offered physicians 40 percent of the profits from the testing. This violates the Stark Law, which prohibits physicians from referring patients to receive health services payable to Medicare and Medicaid from entities with which the physician has a financial relationship.

Additionally, PPOA required patients to undergo medically unnecessary genetic and psychological testing before being seen by physicians. The health system billed federal healthcare programs for these fraudulent tests as well, according to the case.

“Billing federal healthcare programs for services that providers know are unnecessary or unreasonable undermines the quality of care that patients receive and increases the costs of these taxpayer-funded programs,” Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division, said in the press release. “The department is committed to ensuring that healthcare providers base their treatment decisions on their patients’ needs rather than their own financial interests.”

DOJ also alleged that PPOA billed for an inappropriate number of evaluation and management (E/M) visits. When Florida delayed non-emergency medical procedures during the first month of the COVID-19 pandemic, PPOA required its physicians to schedule unnecessary E/M appointments to make up for lost revenue, DOJ claimed.

Instead of scheduling E/M visits every month like usual, PPOA physicians scheduled them every 14 days. The health system then instructed physicians to bill the visits using high-level procedure codes.

The $24.5 million settlement also resolves fraud allegations that PPOA made a false statement to the Small Business Administration that it was not engaged in unlawful activity. This false statement allowed the health system to receive a $5.9 million loan through the Paycheck Protection Program.

The settlement resolves liability under the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) from the false claims for the E/M visits and the fraudulent statement connected to the loan.

As a part of the settlement, PPOA entered into a five-year Corporate Integrity Agreement with the HHS Office of Inspector General. PPOA agreed to maintain a compliance department, medical director, and oversight board; hire a compliance expert; provide management certifications; and obtain annual claims reviews by an Independent Review Organization.

Additionally, PPOA must maintain written standards, training, and education; establish a risk assessment and internal review process; and implement monitoring of testing referrals.

The settlement resolves whistleblower claims from current and former employees of PPOA or its affiliated entities.

In May 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to enhance efforts to combat a prevent pandemic-related fraud by improving coordination mechanisms, identifying resources to unearth fraudulent actions, and sharing information gained from previous enforcement efforts.

Lawyers had predicted that COVID-19 federal funding would lead to increased False Claims Act violations. DOJ has also seen high levels of healthcare fraud as EHR implementation and telehealth use have grown in recent years.

Recently, Providence Health & Services Washington agreed to pay $22.7 million to resolve healthcare fraud allegations that it falsely billed Medicare and Medicaid for medically unnecessary neurosurgery procedures.