Doctor Calls It a 'Game,' Patients Call It Deadly: Inside the Asante fraud settlement.
Overbilling, Upcoding, and Unnecessary Medical Procedures.
Overbilling
Overbilling occurs when healthcare providers charge for more services or more expensive services than were actually provided. It can take several forms:
Billing for services not rendered: Providers submit claims for treatments, tests, or procedures that were never actually performed.
Duplicate billing: The same service or procedure is billed multiple times for the same patient.
Inflating time spent or resources used: Providers exaggerate the amount of time spent with a patient or the amount of resources used during treatment.
Example: A doctor charges Medicare for a complex surgical procedure, even though only a minor procedure was performed, significantly inflating the amount reimbursed.
Upcoding
Upcoding involves the practice of billing for a higher-level service or procedure than what was actually performed. Healthcare providers use billing codes to represent procedures and diagnoses. Some codes correspond to more expensive or complex services, and upcoding occurs when providers intentionally use these codes to receive higher payments.
Billing a higher-level code: A provider performs a basic service but bills it using a code for a more complex and costly service.
Falsely upgrading diagnoses: A patient with a less serious condition is billed under a diagnosis code that represents a more serious condition, justifying more expensive treatment.
Example: A routine follow-up visit is coded as a comprehensive evaluation, which results in a higher payment from insurance.
Medically Unnecessary Procedures
Medically unnecessary procedures occur when healthcare providers recommend and perform tests, treatments, or surgeries that are not medically justified, solely to generate additional revenue. This is particularly problematic because it puts patients at risk for complications and adds unnecessary costs to the healthcare system.
Performing excessive tests: Ordering tests or scans that aren’t needed for the patient’s diagnosis or treatment plan.
Unnecessary surgeries: Recommending or performing surgeries when non-invasive treatments would suffice.
Over-treatment: Providing care that goes beyond what is necessary, such as prescribing extra visits or extended hospital stays.
Example: A surgeon performs a heart valve surgery on a patient whose condition doesn’t meet the clinical guidelines for the procedure, solely to bill for a high-cost operation.
How These Practices Affect the Healthcare System
Financial Strain: Overbilling, upcoding, and unnecessary procedures inflate healthcare costs, wasting resources in programs like Medicare and Medicaid. This leads to higher insurance premiums and increased out-of-pocket costs for patients.
Patient Harm: Medically unnecessary procedures can expose patients to risks like infection, complications, or long recovery periods that they didn’t need.
Undermining Trust: These practices erode patient trust in the healthcare system, as patients may feel they are being exploited for profit rather than treated for their health concerns.
The scheme
The defendant here described the scheme when he allegedly said: "it's a game to me. I want to get paid $2 million a year." What was that game? It allegedly included the following:
Medically unnecessary surgeries
Dr. Carmeci performed surgeries that were not clinically indicated, such as aortic aneurysm surgeries, where patients did not meet clinical criteria, including one case that resulted in the patient’s death.
From paragraph 44 of the Complaint: “Dr. Engstrom noticed that Dr. Carmeci was performing aortic aneurysm surgeries for patients where it was not indicated based on their clinical records. An aortic aneurysm surgery is a highly reimbursed surgery. One of the patients that Dr. Carmeci took in for aortic surgery did not meet the clinical criteria for the surgery and died from the operation.”
Falsification of surgical records
Dr. Carmeci was accused of adding procedures to medical records that were not actually performed. For example, he billed for the closure of a patent foramen ovale (PFO) when pre- and intra-operative echocardiograms showed no PFO existed.
Fraudulent coding practices
Dr. Carmeci was alleged to have coded simple procedures as more complex and higher-paying ones, such as billing for a hernia revision when only stitches were removed or using codes for blood vessel repairs during lung removal surgeries, which were unnecessary or caused by his own error.
Overuse of specialty equipment for billing purposes:
Dr. Carmeci was accused of fraudulently billing for specialty items, like Pleurx catheters, that were not actually used during surgeries.
Unbundling procedures
The complaint describes how Dr. Carmeci would bill for separate procedures that should have been included under a single procedure code, such as billing separately for mass removal and atrial septal defect (ASD) closure, where the closure was part of the mass removal.
The penalty
Asante Health System, a southern Oregon healthcare corporation, and one of its physicians, have agreed to pay $430,000 to settle allegations that the company and its physician knowingly submitted false claims for payment for certain cardiothoracic surgeries to Medicare, Medicaid, and TRICARE.
The whistleblower
Dr. Nicholas Engstrom, the relator, is a cardiothoracic surgeon and former employee of Asante Physician Partners. He worked alongside Dr. Charles Carmeci, also a cardiothoracic surgeon at Asante, and became aware of fraudulent billing practices under the False Claims Act. Dr. Engstrom discovered that Dr. Carmeci was performing unnecessary medical procedures, inflating the complexity of procedures, and billing for services that were either not provided or inaccurately represented.
Key points about Dr. Engstrom’s role as the whistleblower:
First-hand knowledge: Dr. Engstrom observed and documented multiple instances of fraud, including surgeries that were not clinically necessary, false coding, and improper billing for procedures that weren’t performed.
Reports of fraudulent practices: He reported his concerns to Asante’s leadership, including the Chief Medical Officer (CMO), but no action was taken. He ultimately escalated his complaints to federal authorities, including the Centers for Medicare & Medicaid Services (CMS) Office of Inspector General and the FBI.
Retaliation: After raising concerns, Dr. Engstrom faced harassment and scrutiny from Asante’s management, which escalated after he refused to continue participating in these fraudulent billing practices. He eventually left Asante in 2021 due to the ongoing pressure and personal cost to himself and his family.
Medicare fraud: The fraudulent activities included overbilling for procedures like PFO closures, performing surgeries that were not medically indicated, and manipulating billing codes to increase revenue. Dr. Engstrom highlighted cases where Dr. Carmeci performed surgeries such as aortic aneurysm repairs on patients who didn’t meet clinical criteria, leading to at least one patient’s death
Under the qui tam provision of the False Claims Act, a private party (also referred to as a whistleblower or relator) may file an action on behalf of the United States and receive a portion of the recovery, typically between 15-30%.
If you think you’ve observed fraud or misconduct, we can evaluate your options. Vivek Kothari is a former federal prosecutor who represents whistleblowers. For a free consultation, contact Vivek by email, phone, Signal, or fill out the contact form.