A whistleblower proved to be instrumental in exposing illegal practices within 21st Century Oncology Inc. of Fort Myers, Florida, and several of the company’s subsidiaries and affiliates, and the defendant companies have agreed to pay $26 million to resolve accusations of False Claims Act and Stark Law violations, the U.S. Department of Justice announced.
According to the Fort Myers News-Press, Matthew Moore, a health care executive who briefly served as the interim vice president of financial planning at 21st Century Oncology, filed a whistleblower lawsuit against 21st Century in February 2016.
Mr. Moore’s whistleblower lawsuit triggered a federal probe of 21st Century’s alleged Stark Law violations. He claimed that the company based several of its physicians’ salaries on the number of referrals they provided to the company.
“As an example, a 21st Century employee physician might refer a patient to a 21st Century radiation therapy center for radiation oncology therapy or radiology diagnostic testing services,” the lawsuit says, according to the News-Press.
Mr. Moore caught on to the self-referral scheme when he inquired about discrepancies in physicians’ salaries. Another 21st Century employee explained that physician contracts and salaries were based on the money the doctors brought in and their referrals – a claim that federal authorities substantiated in their investigation.
Under pressure from whistleblower claims and federal investigations, 21st Century made a self-disclosure to Justice Department officials about its use of electronic health records software.
The Medicare Electronic Health Records Incentive Program (EHR) incentivizes physicians who attest to their meaningful use of certified EHR technology by offering government payments and allowing physicians to avoid downward adjustments to certain Medicare claims.
According to the Justice Department:
As part of its self-disclosure, 21st Century Oncology reported that it knowingly submitted, or caused the submission of, false attestations to CMS (Centers for Medicare and Medicaid Services) concerning employed physicians’ use of EHR software. The company further reported that, in support of the attestations, its employees falsified data regarding the company’s use of EHR software, fabricated software utilization reports, and superimposed EHR vendor logos onto the reports to make them look legitimate.
Mr. Moore, who received a $2,000,000 whistleblower award for his role in exposing the Stark Law allegations, claims 21st Century fired him after he complained about the violations to the company’s top management.
According to the News-Press, Mr. Moore “says the company told him he was terminated for his ‘arrogant’ behavior and for an accounting mistake he made while working for his previous employer, which had also fired him.”
But Mr. Moore claims in his complaint that “All of 21st Century’s stated reasons for the discharge were pretextual. In reality, the company’s true motivation was to discharge (Moore) because he had complained about illegal physician compensation agreements.”
21st Century Oncology filed for Chapter 11 bankruptcy protection in May after a long earnings slump and multimillion-dollar payouts to settle other fraud allegations. The company is also hoping to cut its snowballing $1.1 billion long-term debt in half.