Patient Accounts Representative Cures Physician’s Alleged Fraud on Taxpayers

Whistleblower Michael Flanery of Largo, Florida was recently rewarded for bringing to the Government’s attention a physician’s alleged violations of the False Claims Act.  His efforts led to a $1.7 million settlement agreement and injunctive relief.

According to documents filed in the case, Flanery was a patient accounts representative for Gabriel DeCandido, M.D., between August 2002 and February 2004.  Dr. DeCandido operates a clinic that treats patients at nursing homes, adult living facilities, and hospitals.  In a complaint filed in the United States District Court for the Middle District of Florida, the United States alleged that Dr. DeCandido defrauded Medicare by “upcoding” – overcharging for services performed –and by charging for services not actually performed.

Specifically, it was alleged that Flanery witnessed multiple false billings to the Medicare program including: billings for tests and other services not actually performed; charging for more time than was actually expended; billing services actually provided by nurses as if they had been performed by physicians; and billing according to a pre-set sequence of charges rather than according to the actual length of the visit and medical complexity involved.

Dr. DeCandido’s alleged billing practices were somewhat unorthodox. According to the Government’s allegations, Dr. DeCandido had a number of doctors and nurses working under them.  While those healthcare providers would complete “encounter forms” for each patient visit, Dr. DeCandido forbade them from filling out the section of the form that assigned a billing code to the visit.  The Government alleged that, instead, the forms went to the Clinic’s billing office where one of Dr. DeCandido’s other employees would place them in a plastic takeout food bag along with unopened office mail.  The bag would then be personally delivered to Dr. DeCandido’s residence; and in the event that neither Dr. DeCandido nor his wife was home, the bag would be left at a designated spot on the front porch of Dr. DeCandido’s house.  Dr. DeCandido allegedly added the billing codes to the forms each night (even though he did not review the medical records, and thus could not have been choosing the correct codes) and left them at the spot on the porch, where an employee would subsequently pick them up the next morning to take them back to the office for submission to Medicare or Medicaid.

Flanery blew the whistle on these alleged activities, and acted as the relator in a qui tam suit.  On July 17 of this year, the parties reached a settlement agreement stipulating that Dr. DeCandido will pay $1.7 million to the United States, and further requiring that Dr. DeCandido engage independent review organizations to review the accuracy of future claims he submits to the Medicare program.  Flanery will receive $306,000 as his relator’s reward for disclosing the fraud.

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