A Plus Home Health Care Inc. and its owners, Tracy Nemerofsky and her father, Stephen Nemerofsky, have agreed to pay $1.65 million to the United States to settle allegations that A Plus paid spouses of referring physicians for sham marketing positions in order to induce patient referrals, the Justice Department announced today. A Plus is a home health care company located in Fort Lauderdale, Florida.
“Kickback schemes drive up the cost of health care and cause physicians to make decisions based on their own bottom line instead of what is in the best interest of their patients,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “We will hold any health care company, and the individuals that own those companies, responsible for using kickbacks to line their pockets at the expense of taxpayers and federal health care beneficiaries.”
The United States filed a complaint against A Plus and Tracy Nemerofsky alleging that, beginning in 2006, A Plus engaged in a scheme to increase Medicare referrals in the heavily saturated home health care market in southern Florida. The company allegedly hired at least seven physicians’ spouses and one physician’s boyfriend to perform marketing duties, but required the spouses and boyfriend to perform few, if any, actual job duties. Instead, the spouses’ and boyfriend’s salaries allegedly served as an inducement and reward for the physicians’ referrals of Medicare patients to A Plus. According to the complaint, Tracy Nemerofsky fired at least two spouses when their husbands failed to refer a certain number of patients to A Plus. Tracy Nemerofsky allegedly reaped large rewards for the scheme, receiving a salary of $685,000 from A Plus in 2010, when A Plus’ business increased as a result of Medicare referrals generated from the sham marketer scheme.
“Kickback schemes undermine the integrity of our public health care programs,” said U.S. Attorney Wifredo A. Ferrer for the Southern District of Florida. “The settlement announced today holds A Plus accountable for its submission of false claims, including restoring funds paid as a result of the false claims to Medicare. We will not relent in our efforts to combat these kinds of fraudulent schemes.”
“Home health care company owners who engage in such blatant, aggressive kickback schemes to get physicians to refer Medicare patients for the company’s services will instead pay for their improper conduct at the settlement table,” said Special Agent in Charge Derrick L. Jackson of the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG). “We will continue to crack down on such illegal, wasteful business kickback arrangements, which undermine impartial medical judgment, corrode the public’s trust in the health care system and divert scarce Medicare funding.”
The settlement resolves allegations that were originally brought by William Guthrie, a former director of development at A Plus, under the qui tam or whistleblower provisions of the False Claims Act, which permit private parties to sue on behalf of the United States for the submission of false claims and to receive a share of any recovery. The False Claims Act authorizes the United States to intervene in such lawsuits and take over primary responsibility for litigating them, as the United States did here. Guthrie’s share of this settlement has not yet been determined.
The United States previously settled with five couples that allegedly accepted payments from A Plus: Steven and Fortuna Hornreich, Mark and Meredith Rogovin, Sam and Christy Sareh, Gary and Stacy Wolfson, and Keifer Wyble and Nuria Rodriguez.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. 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 this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $22.4 billion through False Claims Act cases, with more than $14.2 billion of that amount recovered in cases involving fraud against federal health care programs.
The investigation of this matter reflects a coordinated effort among the Commercial Litigation Branch of the Civil Division, the U.S. Attorney’s Office for the Southern District of Florida, HHS-OIG and the FBI.
The lawsuit is captioned U.S. ex rel. Guthrie v. A Plus Home Health Care, Inc., 12 CV 60629 (S.D. Fla.). The claims settled by the lawsuit are allegations only, and there has been no determination of liability.