WASHINGTON - Dr. Walter Janke, his wife, Lalita Janke, and Vero Beach, Fla.-based Medical Resources L.L.C. (MR) have agreed to pay $22.6 million to resolve allegations that they caused Medicare to pay inflated amounts based upon the submission of false diagnosis codes, the Justice Department announced today.
The Jankes were the owners of America’s Health Choice Medical Plans Inc. (AHC), a Medicare Advantage Organization (MAO), approved by the federal health care program to provide health care to enrolled Medicare beneficiaries. The Jankes also owned MR, AHC’s primary care provider. AHC and MR are no longer doing business.
The agreement resolves a lawsuit brought by the United States in the U.S. District Court for the Southern District of Florida alleging that the Jankes and MR violated the False Claims Act by causing AHC to falsely increase the severity of beneficiary diagnoses to obtain higher Medicare payments. Under the Medicare Advantage Program, MAO's are paid more to provide services for members with serious and/or chronic medical conditions then they are for relatively healthy members.
In addition to suing the Jankes and MR, the United States successfully petitioned the court to freeze approximately $20 million of the Janke's assets believed to be the proceeds of their unlawful scheme. A portion of the Janke’s frozen assets, along with monies resulting from the dissolution of AHC now held in receivership by the Florida Department of Financial Services, will be used to pay the settlement.
"Patients seeking health care should be able to rely on the diagnoses they are given," said Tony West, Assistant Attorney General for the Justice Department’s Civil Division. "We will aggressively pursue those who falsify medical diagnoses in order to receive taxpayer funds to which they are not entitled."
Christopher B. Dennis, Special Agent in Charge of the Department of Health and Human Services’ Miami Regional Office of Inspector General (HHS-OIG), stated, "[w]hile the OIG continues to target healthcare fraud criminally, this case involving Medicare’s managed care program also reinforces the OIG’s commitment to civilly investigate health care fraud."
The Centers for Medicare & Medicaid Services (CMS) Administrator, Donald Berwick, M.D., added, "[t]his case confirms that Medicare Advantage plans must comply with Medicare’s requirements that payment data must be accurate."
Both HHS-OIG and CMS expressed appreciation for the Department of Justice’s willingness to collaborate with them on the case and to ensure that restitution be made to the Medicare Trust Fund and the federal taxpayers.
The settlement 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), which was announced by Attorney General Eric Holder and HHS Secretary Kathleen Sebelius in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid 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 approximately $4.2 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 have topped $5.8 billion
The settlement was part of a coordinated effort among the Commercial Litigation Branch of the Justice Department’s Civil Division, HHS’s OIG and Office of the General Counsel, and the CMS.