USDOJ: Michigan Doctor Sentenced for Role in Medicare Fraud Scheme

Lansing-area resident Dr Paul Kelly was sentenced to 18 months in prison today for his role in a $13.8 million Medicare fraud scheme. 

Acting Assistant Attorney General Mythili Raman of the Criminal Division; United States Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the United States Department of Health and Human Services, Office of Inspector General’s (HHS-OIG), Chicago Regional Office, made the announcement.  

Kelly, 76, was sentenced by United States District Judge Gerald E. Rosen of the Eastern District of Michigan.  In addition to his prison term, Dr Kelly was sentenced to three years of supervised release and ordered to pay $582,912 in restitution.  

Kelly pleaded guilty on January 10, 2013, to one count of health care fraud.  According to information contained in plea documents, beginning in or around January 2011 and continuing through approximately March 2011, Kelly signed home health care referrals for a home health agency called Moonlite Home Care Inc ., located in Livonia, Mich. Kelly certified Medicare beneficiaries as homebound, a requirement for receiving home health care, when in fact, Kelly had never examined or met the beneficiaries, and they were not homebound. Medicare paid approximately $582,912 for fraudulent home health care claims submitted by Moonlite based on Kelly's referrals. 

This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the United States Attorney’s Office for the Eastern District of Michigan. This case was prosecuted by Trial Attorney Catherine K. Dick of the Criminal Division’s Fraud Section.

http://7thspace.com/headlines/439149/usdoj_michigan_doctor_sentenced_for_role_in_medicare_fraud_scheme.html

Medlocks convicted of Medicare fraud

NASHVILLE -- A couple accused of defrauding the federal government through the fake Medicare bills has been convicted various charges in connection with the case.

Woody Medlock, Sr., 69, and his wife, Kathy Medlock, 57, of Murfreesboro, who are the former owners of Murfreesboro Ambulance Service, have been convicted by a jury on charges of conspiracy, Medicare fraud, wire fraud, and aggravated identity theft, announced David Rivera, acting U.S. attorney for the Middle District of Tennessee.

A third defendant, Woody “Bubba” Medlock Jr., was acquitted of similar charges. 

According to the evidence presented at trial and the indictment, from 1996 through September 2008, the Medlocks conspired and engaged in a scheme to defraud Medicare and Medicaid by submitting claims for payment for the transportation of patients who were not qualified to receive ambulance transportation. 

Evidence at trial showed that the Medlocks submitted or caused to be submitted, through Murfreesboro Ambulance Service, fraudulent claims totaling more than $1.6 million to Medicare and Medicaid for reimbursement of ambulance transports of patients to and from dialysis treatments.

Testimony at trial further showed that these fraudulent claims falsely represented that patients were on stretchers when the patients were actually transported in the front seat of the ambulance or in a seat in the back of the ambulance and were not on stretchers. 

Fraudulent claims also stated that patients were transported individually when in fact, two patients had been transported simultaneously in one ambulance. 

Both defendants were convicted of two counts of aggravated identity theft for using the names and Medicare numbers of patients without lawful authority in submitting claims. 

Kathy Medlock was also convicted of an additional count of aggravated identity theft for use of a doctor’s name in forging and submitting multiple medical necessity forms as part of a Medicare audit. 

“This case represents another example that this office will hold individuals accountable when they steal from health care programs intended to help the elderly and the most needy citizens,” Rivera said. “This office, along with our law enforcement partners at the U.S. Department of Health and Human Services, the Federal Bureau of Investigation, and the Tennessee Bureau of Investigation, will relentlessly pursue those who choose to defraud the Medicare and Medicaid programs.”

“The Medlocks were running a taxpayer-funded taxi service disguised as an ambulance company,” said Derrick L. Jackson, the special agent in charge at the U.S. Department of Health and Human Services for the Office of Inspector General. “The flow of Medicare money has been shut off to this husband and wife team.”

"Today's verdict validates the FBI's commitment to investigate those who take advantage of our health care system and defraud the American public," said A. Todd McCall, the special agent in charge of the FBI's Memphis division. 

"We will continue to work tirelessly with our law enforcement partners and the U.S. Attorney's Office to investigate and prosecute those who commit health care fraud."

The Medlocks face up to 20 years in prison, plus an additional mandatory two years, for aggravated identity theft and a $250,000 fine.

Any sentence following conviction will be imposed by the court after consideration of the U.S. sentencing guidelines and applicable federal statutes.

Federal Medicare Fraud Strike Force Charges Chicago-Area Defendants with Defrauding Medicare and Other Health Insurers

U.S. Attorney’s OfficeMay 14, 2013

Northern District of Illinois(312) 353-5300

CHICAGO—Two area physicians and three health clinic co-owners are among seven defendants charged here with engaging in five separate, unrelated health care fraud schemes to defraud the Medicare program and/or private health insurers of millions of dollars, federal law enforcement officials announced today.

Four of the five cases here are part of a nationwide takedown by Medicare Fraud Strike Force operations in eight cities, announced today by the Departments of Justice and Health and Human Services, resulting in charges against 89 defendants, including doctors, nurses, and other licensed medical professionals, for their alleged participation in Medicare fraud schemes collectively involving approximately $233 million in false billing.

In Chicago, the defendants were charged in two criminal complaints and two informations filed today and yesterday, and an indictment that was unsealed today following the arrest of one defendant in Miami. All seven defendants were charged with health care fraud for allegedly defrauding the Medicare program, or violating the anti-kickback statute, which makes it illegal to offer, pay, solicit, or receive payments in exchange for referrals of Medicare patients. The charges involve various medical treatments and services, as well as durable medical equipment.

“Today’s announcement marks the latest step forward in our comprehensive efforts to combat fraud and abuse in our health-care systems,” said Attorney General Eric Holder. “These significant actions build on the remarkable progress that the HEAT has enabled us to make—alongside key federal, state, and local partners—in identifying and shutting down fraud schemes. They are helping to deter would-be criminals from engaging in fraudulent activities in the first place. And they underscore our ongoing commitment to protecting the American people from all forms of health-care fraud, safeguarding taxpayer resources, and ensuring the integrity of essential health care programs,” he added.

“Today’s charges are part of our continuing efforts not only to deprive dishonest healthcare providers of their illegal profits but to demonstrate to the broader medical services community that health care fraud will be found out and prosecuted with all of our resources. In short, we will not tolerate medical professionals and providers who abuse our healthcare system,” said Gary S. Shapiro, United States Attorney for the Northern District of Illinois.

Details of the Chicago cases follow:

United States v. Ankur Roy, Akash Patel, and Dipen Desai

Ankur Roy, Akash Patel, and Dipen Desai, who owned and operated Selectcare Health Inc., which provided outpatient physical and respiratory therapy in Park Ridge and Skokie, were charged with submitting more than $4 million in false billings to Medicare between March and July 2011. Each defendant was charged with six counts of health care fraud in an indictment that was returned by a federal grand jury last Wednesday and unsealed today.

Roy, 36, of Miami was arrested today in south Florida, while Patel, 33, of Morton Grove, and Desai, 33, of Chicago, will be ordered to appear for arraignment on a later date in U.S. District Court in Chicago.

According to the indictment, the defendants submitted false claims to Medicare and Blue Cross Blue Shield on behalf of Selectcare patients for respiratory therapy services that were never provided. The alleged false billings sought reimbursement for services purportedly provided on days that Selectcare’s sole respiratory therapist was not working; for time periods in which the patients were not receiving care from Selectcare; and for treatment seven days a week for three hours per day, a schedule well in excess of any schedule prescribed for patients at Selectcare.

Roy, Patel, and Desai used a third-party billing service to forward the alleged false claims to Medicare, as well as to private insurers such as Blue Cross if the patient had supplemental private insurance, including insurance funded by labor union health and welfare plans.

Between March and July 2011, the defendants allegedly submitted $4,009,094 in false billings for services that were purportedly provided between April 2010 and April 2011, resulting in payments totaling approximately $2,214,424 from Medicare and $320,881 from Blue Cross Blue Shield. The indictment seeks forfeiture of $2,535,305 in alleged fraud proceeds, including $446,974 in funds withdrawn by cashiers’ checks that were seized by the FBI in July 2012.

The government is represented by Assistant U.S. Attorney Maureen Merin. The case was investigated by the FBI, the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), and the U.S. Department of Labor Office of Inspector General (DOL-OIG).

United States v. Cecilia Ibrahim

Dr. Cecilia Ibrahim, an internal medicine physician who operated Sunrise Medical Center in Flossmoor, was charged with one count of health care fraud for allegedly engaging in a $1.7 million Medicare and private insurance false billing scheme.

Ibrahim, 50, of Frankfort, was charged in an information filed today in U.S. District Court. She will be arraigned on a date to be determined.

Between March 2006 and August 2009, Ibrahim allegedly submitted more than 3,200 false claims to Medicare and Blue Cross Blue Shield using a billing code for spinal decompression neuroplasty, a surgical procedure that she did not perform, when she only performed intervertebral differential dynamics therapy (IDD), a non-surgical procedure. As a result, she allegedly caused a loss of at least $300,000 to Medicare and $550,000 to Blue Cross Blue Shield. The indictment seeks forfeiture of at least $882,500 in alleged fraud proceeds.

The government is represented by Assistant U.S. Attorney Samuel B. Cole. The case was investigated by the FBI, HHS-OIG, and the Railroad Retirement Board Office of Inspector General.

United States v. Ellyse Lamon

Elysse Lamon, an account executive at a company that sold durable medical equipment, including back braces and transcutaneous electrical nerve stimulation units, also known as tens units, was charged with one count of health care fraud for allegedly engaging in a $350,000 Medicare false billing scheme.

Lamon, 30, of Elmhurst, was charged in an information filed today in U.S. District Court. She will be arraigned on a date to be determined.

Between October 2010 and May 2011, Lamon allegedly caused her company to submit false claims to Medicare representing that a physician had prescribed back braces and tens units when she knew that no physician had done so and the items were not medically necessary. In order to provide written support for the false claims, Lamon allegedly obtained patient records without a physician’s permission and added false information reflecting that a physician had ordered the equipment for the patients. She allegedly forged doctors’ signatures on documents, including false treatment records she created. Lamon further used patient information she had inappropriately accessed at a pain medicine center in Chicago to set up patient meetings where she falsely told patients that doctors had prescribed the equipment for them, according to the charges.

Lamon allegedly submitted false claims to Medicare totaling $352,685, resulting in payment of at least $206,233 to her medical equipment company. She allegedly profited from these false claims by receiving increased commissions and other benefits from her company.

The government is represented by Assistant U.S. Attorney Kruti Trivedi. The case was investigated by the FBI and is not part of the Medicare Fraud Strike Force operation.

United States v. Nalini Ahluwalia

Dr. Nalini Ahluwalia was charged with one count of violating the anti-kickback law for allegedly receiving $1,000 in exchange for referring two patients to a home health care agency in August 2012.

Ahluwalia, 58, of Burr Ridge, was charged in a complaint filed today in U.S. District Court. She will be ordered to appear on a date to be determined.

According to the complaint, a confidential informant who worked at a home health care company in Chicago, told agents that the confidential informant had previously paid kickbacks to Ahluwalia of $400 to $500 per patient in exchange for her referral of Medicare patients to the home health care company.

On August 23, 2012, at the direction of agents, the confidential informant met with Ahluwalia at the doctor’s office in Chicago and paid her $1,000 for the two Medicare patient referrals in an exchange that was reflected on an audio/video recording, according to the complaint affidavit. In October 2012 and February 2013, the informant allegedly made two additional $500 payments to Ahluwalia in exchange for Medicare patient referrals.

The government is represented by Assistant U.S. Attorney Samuel B. Cole. The case was investigated by the FBI and the HHS-OIG.

United States v. Joseph Dickson

Joseph Dickson, the president and owner of JD Medical Consultants Inc., a medical marketing company, was charged with one count of violating the anti-kickback law for allegedly receiving $4,200 in exchange for referring patients to a home health care agency in October 2012.

Dickson, 65, of Lansing, was charged in a complaint filed yesterday in U.S. District Court. He will be ordered to appear on a date to be determined.

According to the complaint, a confidential informant who owned a home health care company in the Chicago area, told agents that the confidential informant had previously paid kickbacks to Dickson, among others, for referring Medicare patients to another home health care company where s/he previously worked. Dickson was described as a “middle man” who arranged the referral of patients from a physician to a home health care company, and the confidential informant told agents that the confidential informant had paid Dickson approximately $15,000 for referring about 30 patients between 2006 and 2008.

On October 3, 2012, at the direction of agents, the confidential informant met with Dickson at his office in Chicago and paid him $4,200 for seven Medicare patient referrals, at $600 each, in an exchange that was reflected on an audio/video recording, according to the complaint affidavit. In December 2012, the informant allegedly made an additional $1,800 payment to Dickson in exchange for Medicare patient referrals and re-certifications.

The government is represented by Assistant U.S. Attorney Joseph H. Thompson. The case was investigated by the FBI and the HHS-OIG.

The charges in these cases carry the following maximum penalties on each count: health care fraud—10 years in prison and a $250,000 fine, or an alternate fine totaling twice the loss or twice the gain, whichever is greater; and violating the anti-kickback statute—five years in prison and a $250,000 fine. If convicted, the court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.

The Medicare Fraud Strike Force began operating in Chicago in February 2011 and consists of agents from the FBI and HHS-OIG working together with prosecutors from the U.S. Attorney’s Office and the Justice Department’s Fraud Section. The strike force is are part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.

Since their inception in March 2007, strike force operations in nine locations have charged more than 1,500 defendants who collectively have falsely billed the Medicare program for more than $5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The nationwide takedown was announced today by Attorney General Holder, HHS Secretary Kathleen Sebelius and other federal law enforcement officials. Mr. Shapiro announced the Chicago charges with Cory B. Nelson, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; Lamont Pugh, III, Special Agent in Charge of the Chicago Regional Office of the HHS-OIG; and James Vanderberg, Special Agent in Charge of the Labor Department Office of Inspector General in Chicago. The Railroad Retirement Board Office of Inspector General assisted in the Ibrahim investigation.

The public is reminded that indictments, informations, and complaints contain only charges and are not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.

U.S. Renal Care to Pay $7.3 Million to Resolve False Claims Act Allegations

Department of Justice

Office of Public Affairs

FOR IMMEDIATE RELEASE

Tuesday, May 21, 2013

U.S. Renal Care to Pay $7.3 Million to Resolve False Claims Act Allegations

Allegedly Submitted False Medicare Claims for Drug Provided to Dialysis Patients

U.S. Renal Care, headquartered in Plano, Texas, has agreed to pay $7.3 million to resolve allegations that Dialysis Corporation of America (DCA) violated the False Claims Act by submitting false claims to the Medicare program for more Epogen than was actually administered to dialysis patients at DCA facilities, the Justice Department announced today.  U.S. Renal Care, which acquired DCA in June 2010, owns and operates more than 100 freestanding outpatient dialysis facilities throughout the United States.
Epogen is an intravenous medication that is used to treat anemia, a common condition afflicting patients with end-stage renal disease.  Epogen vials contain a small amount of medication in excess of the labeled amount, known as “overfill,” to compensate for medication that may remain in the vial after extraction and in the syringe upon administration.  The United States contends that from January 2004 through May 2011, DCA billed for 10-11% overfill whenever it administered Epogen.  However, because of the types of syringes DCA used, the United States alleges that DCA was not able to withdraw and administer 10-11% overfill every time it administered Epogen to patients, and thus submitted false claims to Medicare that overstated the amount of Epogen that it was actually providing.
“Today’s settlement shows that the Justice Department will aggressively pursue those health care providers who cut corners at the expense of the American taxpayers, such as by billing for items and services that were not provided,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division.  “We will continue to protect scarce Medicare dollars.”
“Medical care providers who submit false claims for services and products that were not actually delivered threaten the financial viability of the Medicare Trust Fund,” said Rod J. Rosenstein, U.S. Attorney for the District of Maryland.
“Health providers billing for phantom services cheat taxpayers, cheat programs straining to pay for vitally needed care, and cheat patients who pay inflated copayments,” said Nick DiGiulio, Special Agent in Charge, Office of Inspector General, U.S. Department of Health and Human Services for the region including Maryland.  “We will continue to work with the Department of Justice to ensure health professionals get reimbursed only for services they actually provide”
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover $10.2 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.
The allegations settled today arose from a lawsuit filed by Laura Davis against DCA under the qui tam, or whistleblower, provisions of the False Claims Act. The Act allows private citizens with knowledge of fraud to bring civil actions on behalf of the United States and share in any recovery.  Ms. Davis will receive $1,314,000 as part of today’s settlement.
This case was handled by the Civil Division of the Department of Justice and the U.S. Attorney’s Office for the District of Maryland with assistance from the Office of Inspector General for the Department of Health and Human Services.  The claims settled by this agreement are allegations only, and there has been no determination of liability.  The whistleblower suit is captioned United States ex rel. Laura Davis v. Dialysis Corporation of America, No. 1:08-cv-2829 (D. Md.).

Entrepreneurs At Health 'Datapalooza' Ask Feds For More Data - Kaiser Health News

 

By Eric Whitney, Colorado Public Radio

JUN 06, 2013

Health and Human Services Secretary Kathleen Sebelius announced the agency’s latest liberation of data from its vast trove of health care information this week, making public for the first time price and quality specifics for 30 different out-patient procedures at hospitals nationwide.

But this data stream is not big enough or fast enough for some entrepreneurs.

"Thank-you, Secretary, for releasing 30 of 30 million things you need to release," chided Jonathan Bush, CEO of practice management and health data company Athena Health.

Sebelius, who was speaking at the annual Health Datapalooza conference Monday in Washington, told Bush and hundreds of other tech entrepreneurs that the Obama administration is "a great believer that unlocking our data, turning it over to those of you that know how to formulate that data for policymakers and providers, is the best possible thing to do."

The White House is trying to spur innovation by releasing more of its data from Medicare, Medicaid and other sources. It’s using the approach taken by the National Oceanic and Atmospheric Administration as a prototype, hoping to trigger a blossoming of new products, services and businesses similar to what happened when that agency threw open the doors to its weather forecasting models and other data. 

But Bush said the federal government also could learn from the private sector in how it shares valuable price and quality intelligence with entrepreneurs. Health plans, he added, are a lot more forthcoming with the kind of information care management companies like his need to steer patients to the best value and avoid inefficient operators.

"My hope is the pressure will build and eventually [HHS] will let go," of more claims data, said Bush, who is a cousin of George W. Bush.

Datapalooza is an effort by "data liberators" in government, academia and private industry to build  pressure for more access to health care information like utilization rates, geographic anomalies and just about anything else the government and private industry knows about patients, payers and providers. The idea is that, in the hands of creative entrepreneurs, "lazy data" can be transformed into innovative new products and services.

The "conditions are aligned unlike they've ever been aligned before," for health care transformation, said Steven Krein, a tech entrepreneur and co-organizer of Datapalooza. Out-of-control health care costs and Affordable Care Act initiatives to drive them down are creating new opportunities for data scientists to reduce waste and inefficiency, making money for themselves from the savings they can deliver to health plans, health care providers and patients.

Hospitals are willing to pay for new computer modeling software that predicts, for instance, which patients are most likely to be re-admitted within 30 days of discharge. Government penalties for high re-admission rates are creating that incentive, and if programmers can create effective models that cost less than hospitals would pay in penalties, hospitals come out ahead. So do patients, who benefit by not having to return hospitals. Health plans win by not having to pay for re-admissions.

"The world now recognizes that the critical component to driving transformation in this system that badly needs disruption is data," agreed HHS Chief Technology Officer Bryan Sivak.

"Healthcare is very backward," said technology Venture Capitalist David Jones of Chrysalis Ventures. The industry is probably two decades behind purely digital companies like Google and big retailers like WalMart in terms of being able to gather and analyze consumer data, and use to adapt to market demand and improve efficiency and competitiveness, he said.

More than 60 entrepreneurs showcased new data-driven healthcare applications at Datapalooza.

Among them, the two 28-year-olds behind Aidin, a brand-new tech company aiming to make it easy for people to choose the right post-hospital care. 

Mike Galbo and Russ Graney, who have no previous experience in healthcare, dove into health data after having bad experiences watching loved ones struggle in less-than-ideal rehabilitation facilities. 

"A nurse from the hospital presented us a list of all the providers in the area with their phone numbers and addresses, and said to us, 'I'm going to be back in an hour, tell me where you want your uncle to go,'" Graney said. He got out his smartphone, but couldn’t find good information to help him shop for the right facility, and ended up picking the one closest to home. Substandard care there, he said, meant his uncle had to be re-admitted to the hospital a short time later.

So Graney and Galbo combined HHS data with information they gathered on their own to create an online shopping tool that made quality ratings and patient reviews easy to find and use. They're piloting it in four hospital systems this year, and expect that by this fall that it will be used to place about 30,000 patients in post-acute care facilities.

This story is part of a collaboration that includes Colorado Public Radio, NPR and Kaiser Health News.

Entrepreneurs At Health 'Datapalooza' Ask Feds For More Data - Kaiser Health News

Coventry Health Care, Inc. Announces Offer to Purchase 6.125 Percent Debt Securities for Cash

PRESS RELEASE

June 6, 2013, 4:15 p.m. EDT

HARTFORD, Conn., Jun 06, 2013 (BUSINESS WIRE) -- Coventry Health Care, Inc., a wholly owned subsidiary of Aetna Inc. AET +1.98% , announced today the commencement of a cash tender offer (the "Change of Control Offer") for any and all of its outstanding 6.125 percent senior notes due 2015 (CUSIP No. 222862AF1). The securities are fully and unconditionally guaranteed by Aetna.

The Change of Control Offer is being made pursuant to the indenture governing the securities, which requires Coventry to offer to purchase the securities upon the occurrence of a change of control of Coventry. The merger by which Coventry became a wholly owned subsidiary of Aetna, which was completed on May 7, 2013, constituted a change of control of Coventry under such indenture.

The Change of Control Offer will commence on June 6, 2013, and expire at 5:00 p.m. ET on July 8, 2013 (the "expiration date"). The purchase price to be paid for any securities that are validly tendered and not validly withdrawn pursuant to the Change of Control Offer will be 101 percent of the principal amount of such securities, plus accrued and unpaid interest to the purchase date for the Change of Control Offer, which will be July 10, 2013.

The Change of Control Offer is being made pursuant to an "Offer to Purchase" dated June 6, 2013, which sets forth a more detailed description of the Change of Control Offer, the merger and Aetna's guarantee of the securities. Holders of the securities are urged to read carefully the Offer to Purchase before making any decision with respect to the Change of Control Offer.

In order to receive the purchase price payable pursuant to the Change of Control Offer, holders of the securities must validly tender their securities prior to the expiration date and not validly withdraw their securities prior to the expiration date. Prior to the expiration date, securities tendered may be withdrawn at any time by following the procedures described in the Offer to Purchase.

The obligation of Coventry to accept for purchase and to pay the purchase price and the accrued and unpaid interest on securities purchased pursuant to the Change of Control Offer is not subject to any minimum tender condition.

U.S. Bank National Association (U.S. Bank) is serving as paying agent for the Change of Control Offer. Questions regarding the Change of Control Offer may be directed to U.S. Bank at 1-800-934-6802. Requests for assistance or additional copies of the Offer to Purchase may be directed to Aetna at 1-860-273-1322.

This news release shall not be construed as an offer to purchase or a solicitation of an offer to purchase any of the securities or any other securities. None of Coventry, Aetna or U.S. Bank makes any recommendations as to whether holders of the securities should tender their securities pursuant to the Change of Control Offer.

About Aetna

Aetna is one of the nation's leading diversified health care benefits companies, serving an estimated 44 million people with information and resources to help them make better informed decisions about their health care. Aetna offers a broad range of traditional, voluntary and consumer-directed health insurance products and related services, including medical, pharmacy, dental, behavioral health, group life and disability plans, and medical management capabilities, Medicaid health care management services, workers' compensation administrative services and health information technology services. Aetna's customers include employer groups, individuals, college students, part-time and hourly workers, health plans, health care providers, governmental units, government-sponsored plans, labor groups and expatriates. For more information, see www.aetna.com.

Cuccinelli: IRS Refusing to Release $125 Million Medicare Fraud Settlement to Virginia

June 5, 2013 - 3:46 PM

(CNSNews.com)

By Elizabeth Harrington

Subscribe to Elizabeth Harrington RSS

Follow Elizabeth Harrington on Twitter

A $125-million settlement from the second largest Medicare Fraud case in history is being held up by the IRS, according to Virginia Attorney General Ken Cuccinelli.

A Virginia Medicaid Fraud Control Unit (MFCU) investigation, which found that Abbott Laboratories illegally marketed the seizure drug Depakote for non-approved uses, was concluded when a settlement was reached in September 2011.  A final court order was issued in October 2012.

However, $125 million owed to Virginia as part of the plea agreement has yet to be paid, and federal officials place the blame on the IRS.

“Federal officials have refused to release approximately $125 million that is owed to Virginia from a 2012 Medicaid fraud case Attorney General Ken Cuccinelli’s office investigated,” reads a statement from Cuccinelli’s office.

(AP Photo)

“Federal officials have said that the IRS has refused to properly fill out post-case paperwork for almost a year, which is holding up the disbursement intended for Virginia law enforcement,” the statement said.

According to Cuccinelli’s office, the IRS and federal government “have known for nearly two years” what Virginia’s fraud unit was owed out of a $198.5 million asset forfeiture, which was part of Abbott’s plea agreement.

The Treasury Department initially blamed the federal budget sequester for why Virginia has not received the money, Cuccinelli said, despite the fact that the funds come from the private sector, to be paid by Abbott Laboratories.

“Now the hold-up is the IRS, which, according to the Treasury Department, refuses to complete its paperwork so the money can be properly distributed,” Cuccinelli said.  “The exact amount of the forfeiture was known since September 2011 and finalized in a May 2012 plea agreement.”

“It doesn’t take a year to complete the paperwork,” he said.

Cuccinelli implied that he believes the delay may be related to the recently uncovered scandal at the agency, where conservative groups were targeted and had their applications for non-profit status delayed for up to three years.

U.S. currency. (AP Photo)

“For months, we thought this was just incompetence by the IRS, but with its refusal to properly fill out fairly simple paperwork for an entire year, we are left to wonder if this involves more deliberate motives,” he said.  “Virginians need to know that for eight months the administration has been withholding money that is supposed to be used to protect first responders’ lives.”

The attorney general said he intends to use the money for police departments, equipment, training and gang and gun crime reduction programs.

“During the eight months the Treasury Department has been withholding the money, they have been depriving Virginia law enforcement of tools to make their jobs safer,” he said.  “The interest alone on Virginia's share of the money in those eight months would have totaled more than a half-million dollars.  That interest could have purchased more than 1,000 bulletproof vests for police officers and sheriffs’ deputies.”

The investigation into Abbott Laboratories found that the company was illegally marketing the prescription drug Depakote to treat dementia patients in nursing homes, and for schizophrenia.  The drug is intended to treat epileptic seizures.

At the time of this story, the IRS did not respond to a request for comment.

New healthcare model cut even more costs in year two:

By Sharon Begley

NEW YORK | Thu Jun 6, 2013 8:10am EDT

(Reuters) - The nation's largest experiment in delivering medical care in an innovative way has reduced costs and improved the quality of care even more in its second year than in its first, according to the insurance company behind it.

The nonprofit CareFirst BlueCross BlueShield launched its "Patient-Centered Medical Home" program in January 2011 among primary-care providers serving about one-third of its 3.4 million members in Maryland, Washington, D.C., and northern Virginia.

Like other "accountable care organizations" (ACOs), which are centerpieces of President Barack Obama's healthcare reform, the medical home program ties insurance payments to healthcare providers to the quality of care they deliver.

On Thursday, CareFirst reported cost savings of $98 million for the medical home program in 2012, compared with $38 million the year before. Proponents of the model say it shows that "bending the cost curve downward," as Obama described one of the goals of his 2010 healthcare law, is achievable. If innovative models like CareFirst's deliver as promised, it will ease the financial pressures on Medicare, the government health insurance program for the elderly and disabled, and make Obama's healthcare reform more likely to succeed.

"This is a very important finding, that a major health plan is able to achieve savings" of this magnitude, said Dr Elliott Fisher, a health policy expert at the Dartmouth Institute for Health Policy and Clinical Practice and an architect of accountable care organizations.

Medical homes, like other ACOs, induce physicians to coordinate care to make sure patients' prescriptions don't interact adversely, for instance, and to think twice before ordering unnecessary tests. Physicians who reduce costs while hitting quality metrics such as regularly checking a diabetic's eyesight receive awards in the form of higher payments.

In CareFirst's program, that incentive is substantial: a 29 percent bump in physician reimbursement rates. The insurer can afford to be so generous because improving primary care, which accounts for only 6 percent of medical spending, reduces far pricier hospitalizations and specialist visits.

CareFirst's success is likely to accelerate other efforts to move from a traditional fee-for-service model, where the more tests and treatments physicians and hospitals do the more they make, to one that rewards efficiency and quality. Twenty-nine U.S. states now let primary-care providers act as patient-centered medical homes for residents on the Medicaid program for the poor, for instance.

Major insurers including UnitedHealth Group, WellPoint, Aetna, Humana and Cigna are also contracting with physicians to operate under an accountable care model.

BUILDING UP SAVINGS

Skeptics have warned that any savings in programs like medical homes would peter out after their first year, as physicians eliminated the most obvious and easiest-to-cut waste, and that further reductions would cut necessary care.

CareFirst has found otherwise.

One million of its members (almost all employed, with an average age of 42) were in medical homes in 2012, the company reported, and 80 percent of the primary-care providers in CareFirst's network participate in the program. These members' healthcare costs were $98 million (2.7 percent) less than CareFirst projected. In 2011, the savings were 1.5 percent.

Most of the savings came from reduced hospital admissions, less use of emergency rooms and lower spending on drugs, said CareFirst Chief Executive Officer Chet Burrell.

Two-thirds of the 3,600 physicians and nurse practitioners participating in the medical home program earned higher reimbursements from CareFirst in 2012, based on a combination of cost savings (which averaged 4.7 percent) and quality measures. Measuring quality - which also includes having extended office hours and using electronic medical records - keeps doctors from trying to save money by skimping on needed care.

"This is a measurable and meaningful step in the right direction of slowing the rise of healthcare costs," said Burrell.

At primary-care practices that did not earn an incentive award, costs averaged 3.6 percent higher than expected. Their quality scores were also worse, suggesting that wasteful care often goes hand in hand with poor care.

CareFirst's savings are in line with those reported by 10 physician groups across the United States that treated Medicare patients under an accountable care model. Annual savings averaged $114 per patient, researchers led by Fisher reported in the Journal of the American Medical Association last year. But savings reached $532, or 5 percent, for patients eligible for both Medicare and Medicaid.

CareFirst received a grant from the federal Centers for Medicare and Medicaid Services to expand the medical home model to Medicare patients starting July 1. These older Americans "frequently have complex health needs and multiple chronic health conditions," said Burrell, and so "could benefit greatly from the coordinated model of care" in medical homes.

(Reporting by Sharon Begley and Caroline Humer; Editing by Douglas Royalty)

Major Family Practice In Houston says no more Medicare

Posted: Jun 05, 2013 10:48 PM EDTUpdated: Jun 05, 2013 10:48 PM EDT

By Greg Groogan, Special Projects Reporter - 

 

HOUSTON (FOX 26) -

After a quarter century of practicing medicine Dr. Robert Van Zant says it's among the toughest calls he's had to make, but he and fellow physicians at Village Family Practice are shutting the door to new patients covered by Medicare.

The third largest group of primary care doctors in the Houston area claims the government insurer's red tape and mandate of electronic record keeping very nearly strangled their business, so they had to act.

"New burdens, restrictions on medicines we can prescribe, restrictions on labs we can do, surgeries we can refer for," said Van Zant.

and then there's Medicare's compensation which for Doctors hasn't risen substantially since 2001.

"Can you imagine going to the auto workers and telling them you are not going to get a raise in 13 years. It would not happen," said Van Zant.

and yet in 2014 Van Zant says physicians will again face a 30 percent cut in the rate Medicare pays for their services.

That's not to mention the unclear impact of the Affordable Care Act known as Obamacare. Van Zant predicts a crisis.

"I think some of the burdens of the Affordable Care Act are really going to strike home next year there are expenses and surprises in that that we haven't even dreamt of yet, but the Affordable Care Act is going to be a financial disaster and its certainly not going to help Medicare," said Van Zant.

Turns out Van Zant and the doctors at Village have plenty of company, the Texas Medical Association says 40 percent of the state's physicians have stopped taking new Medicare patients.

"It brought this practice to a crawl," said Van Zant.

For its part Medicare claims the problem is not widespread reporting fewer than 10,000 doctors across the country have opted out of the program in the past two years.

Van Zant says Village Family Practice treats more than 8,000 existing patients currently on Medicare and will continue to do so.

Read more: http://www.myfoxhouston.com/story/22516084/2013/06/05/major-family-practice-says-no-more-medicare#.UbDOHmDXg_s.blogger#ixzz2VSegPWpD

Major Family Practice says no more medicare - Houston weather, traffic, news | FOX 26 | MyFoxHouston

Final rule implements provisions of the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (collectively referred to as the Affordable Care Act) related to the Small Business Health Options Program (SHOP)

Summary This final rule implements provisions of the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (collectively referred to as the Affordable Care Act) related to the Small Business Health Options Program (SHOP). Specifically, this final rule amends existing regulations regarding triggering events and special enrollment periods for qualified employees and their dependents and implements a transitional policy regarding employees' choice of qualified health plans (QHPs) in the SHOP. Dates These regulations are effective on July 1, 2013. For Further Information Contact Leigha Basini at (301) 492-4307. Supplementary Information I. Executive Summary Beginning in 2014, individuals and small businesses will be able to purchase private health insurance through competitive marketplaces, called Affordable Insurance Exchanges or “Exchanges” (also called Health Insurance Marketplaces). Section 1311(b)(1)(B) of the Affordable Care Act contemplates that in each State there will be a SHOP that assists qualified employers in providing health insurance options for their employees. The final rule, Patient Protection and Affordable Care Act; Establishment of Exchanges and Qualified Health Plans; Exchange Standards for Employers (Exchange Establishment Rule), (1) as modified by the Notice of Benefit and Payment Parameters for 2014, (2) sets forth standards for the administration of SHOP Exchanges. In this rule, we finalize provisions proposed in the Establishment of Exchanges and Qualified Health Plans; Small Business Health Options Program Notice of Proposed Rule Making, (3) which amends some of the standards established in the Exchange Establishment Rule. In the Exchange Establishment Rule, we established standards for special enrollment periods for people enrolled through an individual market Exchange, and provided that, in most instances, a special enrollment period is 60 days from the date of the triggering event. See 45 CFR 155.420. We also made these provisions applicable to SHOPs, at § 155.725(a)(3). In the proposed rule we proposed and this final rule amends, the special enrollment period for the SHOP to 30 days for most applicable triggering events, so that it aligns with the special enrollment periods for the group market established by the Health Insurance Portability and Accountability Act of 1996 (HIPAA). (4) To further align the SHOP provisions with HIPAA, we also proposed that if an employee or dependent becomes eligible for premium assistance under Medicaid or the Children's Health Insurance Program (CHIP) or loses eligibility for Medicaid or CHIP, this would be a triggering event, and the employee or dependent would have a 60-day special enrollment period to select a QHP. This triggering event had previously been inadvertently omitted from the regulations because it applies only to group health plans and health insurance coverage in the group market. We also proposed to make a conforming change to § 156.285(b)(2), so that this section references the SHOP special enrollment periods in a way that is consistent with our proposed changes to § 155.725. In the Exchange Establishment Rule, we also set forth the minimum functions of a SHOP, including that the SHOP must allow employers the option to offer employees all QHPs at a level of coverage chosen by the employer, and that the SHOP may allow employers to offer one or more QHPs to qualified employees by other methods. We proposed and are now finalizing the following transitional policy. For plan years beginning on or after January 1, 2014 and before January 1, 2015, a SHOP will not be required to permit qualified employers to offer their qualified employees a choice of QHPs at a single level of coverage, but will have the option of doing so. Federally-facilitated SHOPs (FF-SHOPs) will not exercise this option, but will instead allow employers to choose a single QHP from the choices available in FF-SHOP to offer their qualified employees. This transitional policy is intended to provide additional time to prepare for an employee choice model and to increase the stability of the small group market while providing small groups with the benefits of SHOP in 2014 (such as a choice among competing QHPs and access for qualifying small employers to the small business health care tax credit). We also proposed changes to the effective date of the SHOP premium aggregation function set forth at § 155.705(b)(4) in the Exchange Establishment Rule consistent with this transitional policy, which we are finalizing in this rule. For the reasons set forth in the preamble, the Department of Health and Human Services amends 45 CFR parts 155 and 156 as set forth below: Regulatory Text Part 155 Exchange Establishment Standards and Other Related Standards Under the Affordable Care Act 1. The authority citation for part 155 continues to read as follows: Authority: Title I of the Affordable Care Act, sections 1301, 1302, 1303, 1304, 1311, 1312, 1313, 1321, 1322, 1331, 1334, 1402, 1411, 1412, 1413. 2. Section 155.705 is amended by revising paragraphs (b)(2) through (4) to read as follows: § 155.705 Functions of a SHOP. * * * * * (b) * * * (2) Employer choice requirements. With regard to QHPs offered through the SHOP for plan years beginning on or after January 1, 2015, the SHOP must allow a qualified employer to select a level of coverage as described in section 1302(d)(1) of the Affordable Care Act, in which all QHPs within that level are made available to the qualified employees of the employer. (3) SHOP options with respect to employer choice requirements. (i) For plan years beginning before January 1, 2015, a SHOP may allow a qualified employer to make one or more QHPs available to qualified employees: (A) By the method described in paragraph (b)(2) of this section, or (B) By a method other than the method described in paragraph (b)(2) of this section. (ii) For plan years beginning on or after January 1, 2015, a SHOP: (A) Must allow an employer to make available to qualified employees all QHPs at the level of coverage selected by the employer as described in paragraph (b)(2) of this section, and (B) May allow an employer to make one or more QHPs available to qualified employees by a method other than the method described in paragraph (b)(2) of this section. (iii) For plan years beginning before January 1, 2015, a Federally-facilitated SHOP will provide a qualified employer the choice to make available to qualified employees a single QHP. (iv) For plan years beginning on or after January 1, 2015, a Federally-facilitated SHOP will provide a qualified employer a choice of two methods to make QHPs available to qualified employees: (A) The employer may choose a level of coverage as described in paragraph (b)(2) of this section, or (B) The employer may choose a single QHP. (4)(i) Premium aggregation. Consistent with the effective dates set forth in paragraph (b)(4)(ii) of this section, the SHOP must perform the following functions related to premium payment administration: (A) Provide each qualified employer with a bill on a monthly basis that identifies the employer contribution, the employee contribution, and the total amount that is due to the QHP issuers from the qualified employer; (B) Collect from each employer the total amount due and make payments to QHP issuers in the SHOP for all enrollees; and (C) Maintain books, records, documents, and other evidence of accounting procedures and practices of the premium aggregation program for each benefit year for at least 10 years. (ii) Effective dates. (A) A State-based SHOP may elect to perform these functions for plan years beginning before January 1, 2015, but need not do so. (B) A Federally-facilitated SHOP will perform these functions only in plan years beginning on or after January 1, 2015. * * * * * 3. Section 155.725 is amended by: A. Amending paragraph (a)(1) by adding “and” at the end of the paragraph. B. Amending paragraph (a)(2) by removing “; and” and by adding a period in its place at the end of the paragraph. C. Removing paragraph (a)(3), and D. Adding paragraph (j). The addition reads as follows: § 155.725 Enrollment periods under SHOP. * * * * * (j)(1) Special enrollment periods. The SHOP must provide special enrollment periods consistent with this section, during which certain qualified employees or a dependent of a qualified employee may enroll in QHPs and enrollees may change QHPs. (2) The SHOP must provide a special enrollment period for a qualified employee or dependent of a qualified employee who: (i) Experiences an event described in § 155.420(d)(1), (2), (4), (5), (7), (8), or (9); (ii) Loses eligibility for coverage under a Medicaid plan under title XIX of the Social Security Act or a State child health plan under title XXI of the Social Security Act; or (iii) Becomes eligible for assistance, with respect to coverage under a SHOP, under such Medicaid plan or a State child health plan (including any waiver or demonstration project conducted under or in relation to such a plan). (3) A qualified employee or dependent of a qualified employee who experiences a qualifying event described in paragraph (j)(2) of this section has: (i) Thirty (30) days from the date of a triggering event described in paragraph (j)(2)(i) of this section to select a QHP through the SHOP; and (ii) Sixty (60) days from the date of a triggering event described in paragraph (j)(2)(ii) or (iii) of this section to select a QHP through the SHOP; (4) A dependent of a qualified employee is not eligible for a special election period if the employer does not extend the offer of coverage to dependents. (5) The effective dates of coverage are determined using the provisions of § 155.420(b). (6) Loss of minimum essential coverage is determined using the provisions of § 155.420(e). Part 156 Health Insurance Issuer Standards Under the Affordable Care Act Including Standards Related to Exchanges 4. The authority citation for part 156 continues to read as follows: Authority: Title I of the Affordable Care Act, sections 1301-1304, 1311-1312, 1321, 1322, 1324, 1334, 1341-1343, and 1401-1402, Pub l. 111-148, 124 Stat. 119 (42 U.S.C. 18042). 5. Section 156.285 is amended by revising paragraph (b)(2) to read as follows: § 156.285 Additional standards specific to SHOP. * * * * * (b) * * * (2) Provide special enrollment periods as described in § 155.725(j); * * * * * Dated: May 13, 2013. Marilyn Tavenner, Administrator, Centers for Medicare & Medicaid Services. Approved: May 15, 2013 Kathleen Sebelius, Secretary, Department of Health and Human Services. [FR Doc. 2013-13149 Filed 5-31-13; 11:15 am] BILLING CODE 4120-01-P http://www.regulations.gov/#!documentDetail;D=CMS_FRDOC_0001-1228