As a healthcare ethics keynote speaker, healthcare ethics consultant and book author, I have written and spoken extensively on elaborate healthcare kickback schemes such as the scandal that involved Purdue Pharma and the explosion of opioids.
In that Purdue case, what is as bothersome as the devastation ultimately wrought on the human who got addicted or died, were the physicians, nurses, physician’s assistants and pharmacists, all adherent to various codes of ethics who willingly stuck out their greedy fingers and collected payoffs – directly or indirectly.
Nothing has changed
Medical kickbacks still continue in all phases of healthcare. News broke today (Compliance Weekly, October 11, 2023) of the results of the Department of Justice years-long investigation into Cardiac Imaging and its CEO Sam Kancherlapalli.
“Kancherlapalli was accused of paying referring cardiologists excessive fees to supervise PET scans between March 2014 and May 2023, according to an Oct. 10 Justice Department news release.”
The fines in this handed down in this nearly 2-decades long scheme, amounted to $85 million and the CEO himself, has been fined $10.5 million. The charges were filed under the False Claims Act and the Stark Law regarding unlawful healthcare provider kickbacks.
If you are not familiar with the Stark Law, a quick description from the GoodRx website states:
“The Stark Law, also known as the physician self-referral law, prohibits healthcare providers from referring Medicare patients for certain services to medical businesses where the provider has a financial interest.”
In other words, if a healthcare provider has a financial interest in “up charging” a patient and ultimately the Medicare System for a scan when they fully know there were cheaper and more reliable PET scan methodologies, they are in violation of the law.
As a healthcare ethics keynote speaker, healthcare ethics consultant and book author this is the kind of scenario that has been costing the Medicare system billions. Those benefitting from kickbacks were sophisticated, highly educated and well aware of what they were doing.
The Whistleblower
It is called “qui tam,” the area in law that defines whistle blowing. Under the (U.S.) False Claims Act, the ethical billing manager saw a striking pattern of corporate greed. She saw patterns of fraud and kickbacks to referring providers and, undoubtedly complained to her management about their practices, and was repulsed (or mocked) to the point where she had no choice but to report it.
Under the law, she is entitled to an undisclosed cash award. More than that, she acted ethically when all of the forces around her tried to shut her down.
The billing manager realized the fees the physicians charging Medicare for using the company’s equipment, were far in excess of normal rates. In addition, the cardiologists were advanced money for time they spent away from the mobile scanning units, they were paid for travel to and from the unit locations and other expenses.
As a healthcare ethics keynote speaker, healthcare ethics consultant and book author, I realize that until the billing manager stepped up, many of the physicians were pocketing healthy sums of money for their fraud.
Not without consequence
Though they may not have realized it at that juncture, the physicians in violating the Stark Law, are subject to a $15,000 penalty per each incident of the self-referral scheme. The penalties, in addition to other censures and legal ramifications could run-up hundreds of thousands of dollars.
This is not overly surprising to me. There is no reason to assume a healthcare provider who lacks ethical training and grounding would be no different than a crooked auto-body mechanic or aluminum siding salesperson.
When there is a lack of moral expectation poor ethics invariably occur. And whether the provider was a recent graduate of Harvard Medical School or a semi-retired medical consultant trained overseas, the same dynamic occurs. The times may have changed, however the intention to the unethical will persist unless there are expectations and most importantly, continuous training.
The CEO of the Illinois-based company was unethical to be sure, but he was also an opportunist. Those he paid out for many years had little attachment to their ongoing acts of greed. I will not be surprised the next time this kind of scheme comes along. I am more surprised by the lack of outrage.
