A federal indictment alleges that a former fraud investigator for Anthem Blue Cross took bribes and provided coconspirators with billing codes that would bypass the insurer's fraud protection firewalls.
Five Californians—including a physician and a former fraud investigator—have been arrested and charged in a scheme that submitted bogus claims to health insurers and used some of the proceeds to provide patients with "free" cosmetic procedures, the Department of Justice said.
The arrest follows the unsealing of a federal indictment this week that details a multi-year scheme that lured patients into two San Fernando Valley clinics to receive free cosmetic procedures—including facials, laser hair removal and Botox injections—which were not covered by insurance.
The conspirators allegedly submitted at least $20 million in claims to the insurance companies, which paid approximately $8 million on those claims, the indictment said.
The scam used the patients' insurance information to fraudulently billed insurers for unnecessary medical services or for services that were never provided. In exchange, the alleged scammers calculated a "credit" that patients could use to receive "free" or discounted cosmetic procedures, the indictment said.
One of the coconspirators, Gary Jizmejian, 44, of Santa Clarita, was a former senior investigator at the Anthem Special Investigations Unit, the anti-fraud unit within Anthem.
The indictment alleges that Jizmejian took bribes in exchange for providing his coconspirators with confidential Anthem information that helped them submit fraudulent bills to Anthem.
In September 2012, Jizmejian gave his coconspirators insurance billing codes—CPT Codes—that Jizmejian knew could be used to submit fraudulent claims to Anthem without Anthem detecting the fraudulent claims, the indictment said.
Jizmejian also allegedly gave his coconspirators the billing code for an allergy-related lab test and told them to submit to Anthem large numbers of bills with this CPT code. The coconspirators used this billing code to submit approximately $1 million in fraudulent claims to Anthem, according to the indictment.
Jizmejian allegedly helped mask the fraud at the clinics by helping coconspirators avoid responding to inquiries from fraud investigators, diverting attention of other Anthem SIU investigators away from the clinics, and closing Anthem investigations into fraud at the clinics, the indictment said.
When reached for comment, Anthem Blue Cross issued the following response:
Mr. Jizmejian is no longer an Anthem employee.
Anthem fully cooperated with the government's investigation.
We have no further comment on pending government charges or activity.
The indicted coconspirators were identified as:
Roshanak Khadem, aka "Roxanne" and "Roxy" Khadem, 50, of Sherman Oaks. Khadem owned and operated the two clinics at the center of the alleged scheme—R&R Med Spa, which was located in Valley Village until early 2016, and its successor company, Nu-Me Aesthetic and Anti-Aging Center, which operated in Woodland Hills.
Roberto Mariano, MD, 59, of Rancho Cucamonga, a physician who helped operate the clinics;
Marina Sarkisyan, 49, of Panorama City, who was the office manager at the clinics;
Lucine Ilangezyan, 38, of North Hills, an employee and insurance biller for the clinics.
All five defendants are charged with one count of conspiracy to commit healthcare fraud and 13 counts of healthcare fraud. Each count charged in the indictment carries a statutory maximum sentence of 10 years in prison.
The not-for-profit, federal qualified health center has served Manhattanites for more than 50 years, and CEO Brian McIndoe says new name reflects its renewed emphasis on patient-centered care.
Manhattan's William F. Ryan Community Health Network has a new name.
The not-for-profit, federally qualified health center, with 19 sites across the Big Apple, is now Ryan Health.
"We just celebrated our 50th anniversary and healthcare has changed over those 50 years, and more so over the past several years," says Brian McIndoe, president and CEO of Ryan Health.
"After 50 years we felt we needed a clear direction going forward for the next 50 years. We wanted to change our name and logo because now we are focusing on our patient-centered care."
So far, Ryan Health has spent about $140,000 on the rebranding, mostly on internal signage and a website redesign. Total cost is expected to be between $270,000 and $300,000 when the rebranding is finalized in the coming months, McIndoe says.
The new name might also clear up some confusion with the clinic's more than 46,000 patients and other healthcare consumers.
"We have six major primary care sites but when you said 'William F. Ryan' the public thought of one site, our oldest site on West 97th St., which is also our largest site," McIndoe says. "They didn’t correlate the other five primary care sites as part of the network of William F. Ryan. We want people to think of our five other primary care sites."
McIndoe concedes that it's a challenge to gain attention in media- and advertising-saturated Manhattan.
"We've been in New York City for 50 years and we have a great reputation, so I don’t think we are going to get lost, but this is the Mecca, and we have to make sure that doesn’t happen," he says.
"We're always conscious about how we can reach our audience. We try to do that in a cost-effective manner. When our patients have a good service at Ryan, they reach out to friends and family and tell them how well we treated them with good clinical care and also with dignity and respect they deserve," he says.
Patients and potential patients will notice the difference when they go to the clinic's new website, and when the interact with the care teams, McIndoe says.
"That really means that, when a patient comes in, they are going to see the same patient service rep, the same nurse, the same provider. So, they get a comfort level with that care team," McIndoe says. "Our goal is that, if they feel more comfortable, they are more ready to share their concerns, and we can treat the patient as a whole, as opposed to piecemeal when they see different providers or nurses."
Ryan Health includes six community health centers, seven school-based health centers, four community outreach centers, a mobile medical van, and a staff of nearly 600 people.
The president has indicated he will sign the VA Mission Act, which makes access to private care easier for veterans, reviews the health system's infrastructure, and expands caregiver programs.
The Senate passed theVA Mission Actwith a 92-5 vote Wednesday and sent the sweeping $55 billion reforms legislation to President Donald Trump, who has said he will sign the bill.
Senate Majority Leader Mitch McConnell, R-Ky., said on the Senate floor Wednesday that the bill "removes those arbitrary time and distance requirements that limit eligibility for outside care."
"It replaces those one-size-fits-all policies with a conversation between veterans and their own doctors about what works best. This will empower more veterans to access the care they need—when and where they need it," McConnell said.
Tom Nickels, executive vice president of the American Hospital Association, praised Congress for passing the bill, saying it will ensure veterans have access to quality healthcare.
"We are pleased that the legislation consolidates multiple VA community care programs into one permanent 'Veterans Community Care Program,'" Nickels said in a statement Wednesday. "This will provide continuity for veterans to access care outside of the VA’s medical network and decrease confusion about eligibility criteria and covered services."
Key components of the bill:
Streamlines the process by which the VA issues payments for private care. VA physicians will now be given the authority to determine whether a veteran would be better off visiting a private physician because a VA facility is too far away or has overly long wait times, as NPR reported.
Expands telemedicine and community health partnership options.
Starts a review of the VA's infrastructure with plans to close down underused facilities that aren't worth keeping open. Congress has vowed to provide close scrutiny for any proposal to close a VA hospital.
Expands afamily caregiver stipendto include Vietnam veterans within two years, and all veterans within four years, as the Associated Press reported.
Opponents of the legislation believe it moves the VA too far toward privatization.Sen. Bernie Sanders, I-Vt.,the former chairman of the Senate Veterans Affairs Committee, voted against the bill and said it provides no funding to fill more than 30,000 positions at the VA that the Trump administration has left vacant
The passage of the bill and Trump's signature will extend the life of theVA Choice program, which was set to run out of funding in June.
This spring marks 4yrs since the Phoenix VA crisis. We won't forget what happened to our GREAT VETS. Choice is vital, but the program needs work & is running out of $. Congress must fix Choice Program by Memorial Day so VETS can get the care they deserve. I will sign immediately!
Sonja Emery allegedly told employers and clients that she held a BSN, graduate degrees in health, business and philosophy, and 25 years of experience in leadership, none of which was true.
A healthcare consultant who allegedly fabricated her credentials and work experience to scam six-figure fees from her victims was indicted by a federal grand jury in Detroit for fraud and tax evasion.
According to an 11-count indictment unsealed this week, Sonja Emery allegedly told clients and employers that she was a registered nurse, had worked in healthcare management, and had various degrees, including a bachelor of science in nursing, master's degrees in health administration, and a doctor of philosophy degree.
The indictment alleges that Emery, also known as "Sonja Lee Robinson," "Sonjalee Emery-Robinson," "Sonjalee Emery," and other names, a resident of New York, New Jersey, and Georgia, earned six-figure salaries, failed to file timely tax returns, failed to pay income taxes on the scammed money, and lied to the Internal Revenue Service, from 2011 to 2014.
The employer and client victims of Emery's alleged fraud were not named in the 19-page indictment. However, the details of her four-year-long scam were in the document.
Among the alleged fabrications:
From 2011 through March, 2014, Emery was employed as a senior vice president by an Ann Arbor-based healthcare consulting firm that paid her $285,000 a year, which she did not report to the IRS.
In 2014, after leaving the Ann Arbor firm, Emery consulted for a Wisconsin-based "community health system" that paid her $267,000, which she did not report to the IRS.
In late 2014, Emery consulted for a Massachusetts-based healthcare employer that paid her $226,000, which she did not report to the IRS.
Emery claimed to be a registered nurse licensed in two states, but an investigation showed that she used the licensure numbers of two other people.
Emery falsely claimed to have a BSN, a master's degree in health administration, a master's in business administration, and a doctorate in philosophy.
Emery fabricated a 25-year career in healthcare, claiming executive experience at a major hospital and consulting firms in Atlanta and New York City. She provided employers and clients with extensive false or forged documents and references validating her fabricated background.
Emery used fake Social Security numbers, misstated her tax liabilities, filed bogus W4 forms with the IRS, and lied about her tax status in a multi-year effort to shake federal auditors.
If convicted, Emery faces a statutory maximum sentence of 20 years in prison for each mail and wire fraud count, five years in prison for each tax evasion count, and three years in prison for lying to the IRS. She also faces restitution and monetary penalties.
As healthcare prices escalate and the public looks for answers, America's Health Insurance Plans has launched a publicity campaign that it says breaks down how a premium dollar is spent.
Spending on hospitals, doctors and prescription drugs account for more than 82 cents of every premium dollar, according to statistics compiled by America's Health Insurance Plans.
"Plans use a meaningful part of premiums to make coverage more efficient and effective," Matt Eyles, incoming president and CEO of AHIP, said in a media release.
"But as prescription drug prices and medical costs continue to rise, it forces premiums higher for hardworking American families. Health plans work hard to negotiate lower costs and premiums for their members," he said.
AHIP based its findings on commissioned research from Milliman, which examine 2014-2016 data gathered from commercial health plans.
Here's the AHIP breakdown:
23.2 cents pays for prescription drugs.
22.2 cents pays doctors, and an additional 20.2 cents pays for all other costs at doctors' offices and clinics.
16.1 cents pays for hospital stays.
4.7 cents pays federal, state, and local taxes.
2.3 cents goes to health insurance provider profits.
1.8 cents pays for customer engagement, including customer service operations; another 1.6 cents pays for care management, including disease management and wellness programs.
1.6 cents pays for activities related to claims, including programs to battle fraud, waste and abuse.
Ashley Thompson, senior vice president of public policy analysis and development at the American Hospital Association, said she's not surprised that prescription drug costs account for a large part of the premium dollars.
"Even so, this study does not account for the amount hospitals and health systems spend on escalating drug prices, which continues to increase," she said.
Thompson pointed to a 2016 study conducted by the Non-Partisan and Objective Research Organization at the University of Chicago for AHA which found that inpatient drug spending per admission increased 38.7% from 2013 to 2015.
"It is clear that hospitals and health systems are feeling this pressure as they work to make care more affordable for patients," she said.
However, Holly Campbell, deputy vice president of public affairs at PhRMA, dismissed AHIP's study as a tired attempt to deflect blame for rising healthcare costs.
"AHIP continues to compare list prices for medicines to net prices for hospital and physician services to advance their same old rhetoric and exaggeration on medicine costs," Campbell said.
"We saw the slowest growth in medicine spending last year – just 0.6%. And prices for brand name medicines grew just 1.9% on average after discounts and rebates, below the rate of inflation. Not medical inflation, but overall inflation. Last year, these rebates and discounts totaled $130 billion," she said.
Despite the dramatic rise in the use of the use of liposomal bupivacaine, the local anesthetic was not associated with a decreased risk in patient opioid-related complications.
A sweeping review of the use of liposomal bupivacaine found no correlation with reduced in-hospital opioid prescriptions or opioid-related complications in patients, according to a study in Anesthesiology.
The local anesthetic is injected into tissues surrounding the surgical wound, and is designed to provide pain control for up to three days, with the hope of reducing the need for opioids.
"When we tested this hypothesis in a real-world setting where state of the art pain procedures such as peripheral nerve blocks were used, we were unable to show benefit," senior author Stavros G. Memtsoudis, MD, said in remarks accompanying the study.
"Local anesthesia is one mode that has been proposed as being part of a multimodal approach to reducing opioid consumption. But we found that adding liposomal bupivacaine to the mix did not add significant benefit," said Memtsoudis, director of critical care services in the Department of Anesthesiology at the Hospital for Special Surgery in New York.
The study looked at data from 88,830 total knee replacements performed between 2013 and 2016 with a peripheral nerve block. One group had a peripheral nerve block and general anesthesia, and another group had a peripheral nerve block and regional anesthesia.
Liposomal bupivacaine was used with a peripheral nerve block in 21% (18,817) of patients. Between 2013 and 2016, the use of liposomal bupivacaine increased from 7% to 26%.
The research showed that liposomal bupivacaine was not associated with a decrease in patients' risk for opioid-related complications including those affecting the respiratory, gastrointestinal and central nervous system. In addition, no clinically relevant decrease in inpatient opioid prescriptions, length of hospital stay, and no reduction in cost of hospitalization was seen.
"It does not seem to be the silver bullet physicians have been hoping for," Memtsoudis said. "We also need to look for other ways to try to combat the opioid crisis, including trying to change physician and patient behavior and expectations. We shouldn't necessarily look at a pharmacological solution for everything."
Nurse practitioners saw an almost 30% growth in total compensation in the past five years, while physician assistants saw a 25% rise in median total compensation over the same period.
Primary care physicians' total compensation rose by more than 10% over the past five years, nearly double that of specialty physicians' over the same period, according to data gleaned by the Medical Group Management Association.
The findings, based on comparative data from over 136,000 providers in over 5,800 organizations, provide more evidence of the nation's worsening primary care physician shortage, said Halee Fischer-Wright, MD, president and CEO of MGMA.
"Many factors contribute to this problem, chief among them being an increasingly aging population that's outpacing the supply of chronic care they require," Fischer-Wright said in comments accompanying the study.
"And with a nearly two-fold rise in median compensation for primary care physicians over their specialist counterparts and increased additional incentives, we can now see the premium organizations are placing on primary care physicians’ skills to combat this shortage," she said.
According to MGMA:
Family medicine physicians saw a 12% rise in total compensation over the past five years, while their median number of work relative value units increased by less than 1%. That's because practices offered more benefits to attract and retain physicians, including higher signing bonuses, continuing medical education stipends, and relocation expense reimbursements.
Nurse practitioners saw the largest increase over this period with almost 30% growth in total compensation. Physician assistants saw the second-largest median rise in total compensation with a 25% increase.
Over the past five years, rises in median compensation varied greatly by state. In two states, median total compensation actually decreased for primary care physicians: Alabama (-9%) and New York (-3%).
Many states saw large increases in median total compensation compared to the national rate, the top five being Wyoming (41%), Maryland (29%), Louisiana (27%), Missouri (24%) and Mississippi (21%).
The District of Columbia is the lowest paying with $205,776 in median total compensation for primary care doctors. Nevada is the highest paying state with $309,431 in median total compensation.
Over the last five years, looking beyond just nurse practitioners, overall non-physician provider compensation has increased 8%. Over the past 10 years, that rate has doubled to 17%.
The difference in compensation between the highest-paid state compared to the lowest ranges between $100,000 and almost $270,000 for physicians depending on specialties, and $65,000 for non-physician providers.
The findings in the MGMA study are consistent with other researching showing impressive compensation gains for primary care doctors.
Physician recruiters Merritt Hawkins last year reported that the average starting salary for family physicians was $231,000, up from $198,000 in 2015, an increase of 17%, while the average starting salary for general internists was $257,000, up from $207,000 two years ago.
The multistate healthcare system has committed upwards of $200 million through its Thriving Communities Fund to tackle housing stability and homelessness in the communities it serves.
Kaiser Permanente is taking the concept of providing care beyond the hospital walls to a new level with its $200 million investment inhousing stability in the communities it serves.
Bechara Choucair, MD, Kaiser Permanente's chief community health officer, spoke with HealthLeaders Media about the initiative.
The following is an edited transcript.
HLM:Where will this $200 million go?
Choucair: We are not sure right now what the investments will be. What we know for sure is that they would be in communities where Kaiser Permanente exists. We have about 12.3 million members in communities where 65 million people live. We operate in eight states and the District of Columbia. As part of our community engagement effort we will identify the right opportunities to invest with a particular focus on housing.
HLM: How will it work? How will you know where to invest?
Choucair: Over the past year we've been engaging with many leaders in this space across the country, people who've been engaging in the development and preservation of affordable housing. There are going to be a wide variety of ways we can invest and leverage our dollars. We will likely be aggregating those dollars with other sources of capital that will be available for specific projects.
It's going to be on a case-by-case basis. That is why, as part of the process, we will be working with community-based organizations and partners that have identified the need and specific projects, and those projects will come through a pipeline to be evaluated and vetted for our Thriving Communities Fund.
There is an advisory committee that includes the senior leadership at Kaiser Permanente that will make the recommendations to invest or not invest in these opportunities.
HLM: So, you will be relying upon outside experts to identify your investment opportunities?
Choucair: Absolutely. The secret sauce is to identify the right partners who do this regularly. There are many community development finance institutions and developers who do this on a day-to-day basis as a core business and they aggregate funds from different sources and we will be working with them to ensure that the right investment opportunities are funded and developed and people have the ability to preserve or build additional affordable housing in our communities.
HLM: What is your return on investment in this?
Choucair: Housing stability is a key factor of what impacts health. We know that what impacts health happens in the communities where people live and the medical system has a lot to offer to advance and maintain health. At the same time, the individual behavior, the social factors, the economic factors, the built environments, all of those impact health. So if we can leverage that fund to invest in opportunities that will allow us to improve on housing stability in communities where we exist, that is the type of social returns that we would like to be able to see.
As we are evaluating each opportunity, we will be looking at financial return on investment but most importantly we will be looking at what type of social return we can see.
Keep in mind that the people who benefit from this don’t have to be Kaiser Permanente members. This is a true community investment in our communities. Part of the social return that you would look at would include things such as hospitalization rates, well-being rate of people participating. Healthcare costs. We will be looking at all of those as part of the social return. Again, it will be on a case by case basis.
HLM: When does this start?
Choucair: For the past year we've been spending a lot of time with community leaders across the country identifying those opportunities. We are in the vetting process now for a couple. I can't tell you exactly when but very soon we will be able to have our first investment announced.
HLM: How far along before you'll know if this investment is having the desired effect, and what metrics will you use to make that determination?
Choucair: It will be, again, on a case-by-case basis. Every investment will have a set of financial and social metrics that we will be tracking and we will be able to evaluate on a regular basis if those investments are paying off from a social perspective the same way as we will be able to track from a financial perspective.
HLM: How far can a hospital go to address social issues "beyond hospital walls?"
Choucair: We don’t do these things by ourselves. We are not going to be running housing developments. We will be partnering with the right people who do this as their core business.
What is important to remember is that as we think about how we meet the needs of our communities, we look at their needs that go above and beyond their healthcare needs. At the end of the day, what impacts your health is the community that you live in. It's how you live. It's where you work and play. If we are going to be truly focusing on optimizing the health and well-being of our members and our communities, we have to think about the conditions for health of equity in the communities where these folks live.
From busting fraudsters, to challenging mergers, acquisition and collusion by hospitals, payers and drug makers, antitrust enforcement remains a top priority for federal regulators.
The Department of Justice will continue to play "an outsized role" in healthcare antitrust enforcement, a federal prosecutor said this week.
In a keynote address at the American Bar Association's Antitrust in Healthcare Conference on Thursday, Deputy Assistant Attorney General Barry Nigro said DOJ will rigorously prosecute Medicare fraudsters and price gouging by drug makers, and continue to cast a skeptical eye toward mergers, potential collusion among health systems and payers.
"Competition in healthcare means being able to afford life-saving surgery, or critical medicines, or an infant's first checkup," Nigro said. "It's important. That's why few, if any, segments of our economy merit higher priority when it comes to antitrust enforcement."
"Because competition benefits consumers in so many ways, antitrust enforcement will continue to play an outsized role in healthcare. Competition keeps healthcare costs down, which broadens access to health care products and services," he said.
Nigro's lengthy speech covered no new ground, but reaffirmed DOJ Antitrust Division's civil and criminal policy and actions against fraud, and anticompetitive practices.
On criminal prosecutions: "Criminal violations are pernicious antitrust offenses. Price fixing and naked market allocation agreements are effectively agreements to steal from consumers (whether in the form of higher prices, lower quality, or fewer choices) and have no procompetitive justification."
On generic drug regulations: "In recent years, there have been large price spikes for certain generic drugs — and the Division’s investigation into this market has revealed that some corporations and executives have sought to enrich themselves at the expense of consumers who rely on these critical medications. It is hard to imagine a more brazen antitrust crime than colluding to take money out of the pockets of seniors and others whose health depends on prescription drugs."
On market allocation and no-poach agreements: "We believe it is important that we use our criminal enforcement authority to police these markets, and to promote competition for all Americans seeking the benefits of a competitive healthcare marketplace."
On exemptions and immunities from the antitrust laws: "Exemptions and immunities should be limited. Often, when an industry is bestowed with an exemption or immunity, competition is displaced, or cabined, by government regulation.
"The Division is skeptical of any claim that government regulation prevents competitors from exercising market power or that consumers do not benefit from the forces of competition to protect their interests."
On defense of the Clayton Act: "Pursuing treble damages under Section 4A has two important benefits. First, it deters cartels and other anticompetitive conduct. Second, it compensates taxpayers for the harms the government suffers due to antitrust violations. We intend to exercise the authority Congress has provided and are actively considering cases in this industry to bring."
On state action doctrine: "When the state action doctrine puts a potentially anticompetitive state regulation (or action pursuant to that regulation) beyond the reach of federal antitrust law, the Division has urged state legislatures to consider the negative effects on competition."
On certificate of need: "Certificate of need laws allow regulators to second guess that business judgment. The new hospital may be profitable at the expense of incumbent competitors, but that is the essence of competition. Incumbent firms thus are the primary beneficiaries of certificate of need laws, and they can take advantage of these laws to thwart or delay entry or expansion by their competitors. Who suffers the consequences? Consumers."
On licensing requirements: "Jointly with the FTC, we have urged state legislatures to carefully consider laws that impose occupational licensing requirements, and insure that any health or safety benefit from such requirements is balanced against the harms to competition such requirements may create."
On professional certification: "By receiving board certification, professionals in these fields can advertise to prospective patients that they have received extra training and thus, potentially, provide higher quality services. But, because certification sometimes becomes a de facto requirement for meaningful participation in a market for healthcare services, certification requirements can at times act as barriers to entry."
The Sacramento-based health system says the issues raised in an anti-competitive suit would impose 'onerous managerial duties' on the court and instead should be handled by state regulators.
Sutter Health has asked a California court to dismiss a suitbrought by the state's attorney general that alleges the health system engaged in systematic anti-competitive practices.
In amotion for dismissal filed this week in the California Superior Court for San Francisco County, attorneys for Sacramento-based Sutter argued that Attorney General Xavier Becerra has made "an unprecedented plea that the court force Sutter to submit to mandatory binding arbitration over its contract terms."
"This is not a suit the Court should consider," the motion stated. "Rather, it should invoke the doctrine of judicial abstention and decline the Attorney General's invitation to assume the role of healthcare policy czar by exercising its powers to dismantle the Sutter system and impose the relief sought in this case."
Instead of the courts, Sutter argued that the "onerous managerial duties" would be better handled by the executive and legislative branches of government which already have the authority and "are better suited to provide long-term oversight over the healthcare contracting issues raised in this case."
"Sutter Health is throwing its weight around in the healthcare market, engaging in illegal, anticompetitive pricing that hurts California families," Becerra said at the filing.
"These tactics are risking Californians' lives by driving up the cost of healthcare for everyone," Becerra said. "Big business should not be able to throttle competition at the expense of patients."
A hearing on Sutter's motion is scheduled for June 11.
