BY JAY WEAVER OCTOBER 07, 2019 06:30 AM, UPDATED OCTOBER 07, 2019
07:56 AM
Armed with cotton swabs,
battalions of healthcare marketers are swooping into senior centers, health
fairs and parking lots in Florida and other places to prey on
unsuspecting elderly citizens for DNA samples, federal authorities say.
They’re also soliciting
seniors over the phone and through social media on the internet.
Many vendors then turn
over the cheek swabs to clinical laboratories, which authorities say pay
kickbacks for the referrals to fleece the federal Medicare program for costly
genetic tests that patients largely don’t need or even know are billed in their
names.
While authorities caution
that the expanding genetic-testing industry has many legitimate operators,
there’s a rising number of scofflaws in the field making it the fastest-growing
area of Medicare fraud. And it’s costing the U.S. government billions in
taxpayer dollars.
Genetic testing, which
entails the examination of a person’s DNA to predict risks for cancer, dementia
and other diseases, has become so corrupted by racketeers that the Justice
Department recently unveiled its first nationwide take-down of 35 suspects
accused of fraudulently billing $2.1 billion to Medicare. Nine doctors, accused
of writing prescriptions in exchange for kickbacks, were among those arrested
last month.
It is the latest
viral-like scam to infect the U.S. government’s health insurance system for
senior citizens — a program that helps tens of millions of Americans but also
has suffered from widespread fraud for decades involving false claims for
medical equipment, HIV-infusion drugs, home healthcare and psychotherapy
services. South Florida, as usual, is at the forefront of genetic-testing
schemes, authorities say, but they extend far beyond this region.
Federal law enforcement
and regulatory agencies first started seeing an increase in genetic-testing
claims to Medicare and keeping an eye out for fraud five years ago.
“But in 2018 we started
to get an explosion of complaints [from Medicare beneficiaries],” said Shimon
Richmond, assistant inspector general for investigations at Health and Human
Services’ Office of Inspector General. He called genetic-testing scams a
“pervasive problem all over the map,” prompting the federal agency to start
issuing fraud alerts over the summer.
Complaints about
genetic-testing fraud soared to 50 a week compared to one a week, said
Richmond, the former special agent in charge of HHS-OIG’s office in South
Florida. “This is an ever-growing problem because of the intersection of
technology and medicine,” he told the Miami Herald. “It’s a big challenge. ...
We’re trying to ensure that legitimate tests are covered while preventing as
much of this fraud as possible.”
In recent years federal
agents with HHS-OIG and the FBI have made a handful of genetic-testing criminal
cases, but the take-down carried out in late September signaled a significant
escalation of scams across the country.
One of the biggest was in
South Florida. Richard Garipoli, 42, the owner of a telemedicine company called
Lotus Health in Loxahatchee, was charged with defrauding Medicare and receiving
kickbacks while collaborating with labs that billed more than $326 million for
Cancer Genomic tests, known as CGx tests. The Medicare program paid more than
$84 million to the labs, located in Georgia and Pennsylvania, which in turn
paid kickbacks to Garipoli and other unnamed co-conspirators between January
2017 and September 2019, according to an indictment.
“Doctors contracted with
Lotus Health allegedly authorized bogus doctors’ orders that CGx tests were
medically necessary when the doctors did not engage in treatment of the
[Medicare] beneficiaries, had no physician-patient relationship with them, and
often did not even speak with the beneficiaries for whom they ordered the
tests,” according to a Justice Department statement.
The genetic tests, which
cost about $10,000 each on average, were not medically necessary and therefore
not eligible for Medicare reimbursement, said Justice Department trial lawyers
James Hayes and Tim Loper, who are seeking to recover more than $3 million in
Medicare proceeds from Garipoli.
A defense attorney for
Garipoli, who was released from federal custody Wednesday on a $500,000 bond
and faces arraignment on Oct. 16, says his client is a legitimate businessman
who committed no crimes against the government’s healthcare program.
Attorney Simon Steckel
said Garipoli’s telemedicine business matched up Medicare patients with doctors
for the genetic tests and then the DNA cheek swabs were turned over to labs for
evaluation to determine if there was a hereditary risk for cancer or other
terminal illnesses. Garipoli’s company didn’t bill Medicare, he said. The labs
did.
“We are going to be able
to show that hundreds of satisfied patients contracted for these services and
received them,” Steckel said. “Our position is that the money he’s receiving
from the labs is not kickbacks. It’s legitimate income.”
Another federal indictment
accuses a Gainesville doctor of ordering genetic tests for hundreds of patients
— most from New Jersey who received $75 gift cards from marketing companies to
persuade them to turn over DNA cheek swabs to labs that billed Medicare,
authorities say. Last year, the federal program paid a network of labs about
$4.6 million for genetic tests that the Gainesville doctor allegedly ordered
without seeing the patients. Five business people operating telemedicine
companies and labs in Florida and other states were also charged in the
healthcare fraud conspiracy.
In addition, federal
prosecutors filed genetic-testing cases in Georgia, South Carolina, Texas and
Louisiana as part of the latest Medicare fraud take-down.
On Friday, the owner of a
Tampa-area medical marketing company was sentenced to nearly six years in
prison on healthcare fraud and kickback charges for providing DNA swabs from
Medicare patients in Miami to a lab for genetic testing. The patients were
given food and other inducements to provide the swabs in the $2.2 million
Medicare fraud scheme, while the Tampa business owner, David Brock Lovelace,
49, paid kickbacks to the Miami clinic owners and received similar payments
from the lab for his referrals, according to the Justice Department. The Miami patients
never saw the test results.
HHS-OIG’s Richmond said
that these cases, involving purported genetic-testing services offered by
phone, on the internet or in person, generally extend beyond a state’s borders.
“It’s more difficult to classify hotter spots [of the country] because you may
have a lab in Georgia doing tons of billing, but the majority of the patients
are in South Carolina, Pennsylvania or Florida,” he said.
Florida, especially the
Miami and Tampa areas, have long been recognized as incubators for all types of
Medicare fraud.
Officials with the
Florida Department of Elder Affairs said the agency received a federal grant of
$475,000 to work with about 500 Senior Medicare Patrol volunteers across the
state to educate and warn senior citizens about genetic-testing and other
scams.
Anne Chansler, the
agency’s director of elder protection, said senior citizens should be on guard
against any healthcare vendors who try to solicit DNA cheek swabs under any
circumstances, whether it be at a health fair, in a supermarket parking lot or
over the internet. If anyone is concerned about a family history of cancer or
dementia, a Medicare beneficiary should consult with a doctor, undergo an
evaluation, have the cheek swab done and review the lab results with the
physician, Chansler said.
“The reach is endless,”
she said, referring to the locations visited by unscrupulous vendors to hit up
seniors. “If it’s not your doctor, don’t do it. ... Never give out your
Medicare information.”
Chansler said that senior
citizens not only run the risk of being exploited for Medicare fraud but that
their identities and Social Security numbers could be used for financial scams.
“We’re really pushing the guard your card [defense],” she said.
Chansler also said senior
citizens or their family members need to scrutinize so-called Medicare
explanation of benefits to ensure their card is not wrongly used to bill the
federal program for false claims. She said Medicare beneficiaries should be on
the lookout for such suspicious genetic-testing items as “gene analysis,”
“molecular pathology” or “laboratory” services.
And, she said, any
Medicare beneficiary who had a cheek swab done without a physician should
report it to state or federal authorities.
If you suspect Medicare
fraud, contact the federal Office of Inspector General hotline at
1-800-HHS-TIPS, or the Florida Department of Elder Affairs at 1-800-963-5337.
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