FCA Case Proceeds Based on Physician’s Evidence of Alleged Billing Scheme

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A False Claims Act lawsuit brought by an emergency medicine physician was allowed to proceed based on evidence submitted by the physician demonstrating his own involvement in an alleged billing scheme. While the outcome of the case is still to be determined, it offers a lesson for healthcare providers on the importance of engaging in proper billing practices.

U.S. ex rel. Sonyika v. ApolloMD, Inc. et al

Dr. Chionesu Sonyika originally filed a complaint under the False Claims Act (FCA) against ApolloMD in 2017 on behalf of the federal government and six states. The FCA, which applies to fraud against government programs such as Medicare and Medicaid, has a qui tam provision in which whistleblowers, known as relators, may bring a case on behalf of the government and share in any damages recovered. In 2019, the federal government provided notice it would not intervene in the relator’s case, a happenstance that often marks the beginning of the end for a FCA case. But the U.S. District Court for the Northern District of Georgia, Atlanta Division, recently allowed an amended complaint filed by Sonyika to survive the defendants’ motion for dismissal.

The Physician’s Allegations

Based in Atlanta, Ga., ApolloMD is a privately held company that provides staffing and management services for emergency medicine, hospital medicine, anesthesia, and radiology providers at a number of hospitals. The relator, who worked for the defendants at medical centers in Georgia, alleges ApolloMD used a fraudulent scheme to systematically submit false claims to the Centers for Medicare and Medicaid Services (CMS) and state Medicaid programs. The relator alleged that ApolloMD submitted claims for reimbursement indicating that patients were seen by both a midlevel provider (nurse practitioner or physician assistant) and a physician, even though most patients were only seen by a midlevel provider. Claims submitted under a midlevel provider’s National Provider Identification (NPI) number are only reimbursed at about 85 percent of the rate of those submitted under a physician’s NPI, according to the relator, who alleges that AppolloMD directed its physicians to sign charts even for patients they did not treat, to allow for submission under the higher reimbursement rate. Further, the relator claims ApolloMD emailed all emergency department physicians directing that services for all Medicare patients be billed under the physician’s NPI number, regardless of whether the physician actually saw the patient.

To support his allegations, the relator presented a screenshot that he claimed reflected his own compensation history. The relator claims it would have been physically impossible for him to see all the patients he is listed as treating during the designated time period. The relator also provided various emails from leadership requesting or reminding physicians to attest to or sign midlevel provider charts. Additional evidence included information submitted by the defendants to the Physician Quality Reporting System (PQRS), which the relator alleges raised questions among physicians as to why services they had not actually performed were attributed to them.

What the Court Said

The defendants moved for dismissal, arguing that the relator failed to “plead with particularity that any false claims were actually presented to or paid for by the government” and that the relator “admits that he has no examples of actual fraud.” The defendants further argued the relator does not have first-hand knowledge of the defendants’ billing practices.

Although acknowledging the relator failed to identify any single claim presented for reimbursement, the court held the relator’s personal knowledge and involvement in the alleged scheme provided sufficient “indicia of reliability” for the FCA claims. The court said the relator’s eight years of working at two different ApolloMD locations, his close review of his own billing and payment data, and the email correspondence from ApolloMD’s leadership that the relator submitted as evidence of the alleged scheme allowed the case to proceed under the FCA. The Eleventh Circuit, which includes Georgia, applies a “nuanced, case-by-case approach” when considering whether the required indicia of reliability necessary for stating firsthand knowledge of a scheme are present. “A relator with direct, first-hand knowledge of the defendants’ submission of false claims gained through employment with the defendants may have a sufficient basis for asserting that the defendants have actually submitted false claims,” the court said.

Additional Allegations Were Dismissed

The relator also alleged that ApolloMD violated the Anti-Kickback Statute of the FCA, but on this count, the defendants’ motion for dismissal was granted. The relator claimed that the requirement that physicians sign off on every chart resulted in significantly increased payments to physicians, since the physicians’ compensation was directly tied to the number of patients they were listed as treating. The relator alleged this amounted to illegal kickbacks. However, the court held the relator failed to plead with particularity the elements of this claim.

Further, as the relator did not show adequate foundation for knowledge of ApolloMD’s billing and claims practices outside of Georgia, the relator’s claims alleging state FCA violations against government programs in five other states were also dismissed.

The Takeaway

This case illustrates the importance for healthcare practices and physician practice management companies to regularly audit their global practices to assure compliance. Should Dr. Dr. Chionesu Sonyika’s case prove successful, it may encourage other potential whistleblowers to come forward with their personal knowledge of improper billing practices

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