If you operate in the telehealth space, legal counsel is vital to properly evaluating your arrangements and ensuring compliance with federal health care regulations and any applicable safe harbors and exceptions. Our health and medical law team at Hendershot Cowart P.C. has decades of experience counseling physicians, DME companies, lab owners, and other physicians and non-physicians in a range of proactive and responsive regulatory matters. We’re available to help clients across Texas and beyond.

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According to the U.S. Attorney's announcement, the schemes involved marketers who would call and solicit Medicare patients, often from call centers overseas, for medically unnecessary braces and cancer genetic testing for screening purposes. After paying medical providers, typically through locum tenens (temp work) companies, to review and sign the orders via telemedicine, the marketers would then sell the signed orders to the owners of DME supply companies and labs in violation of the Anti-Kickback Statute.

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Some of the largest takedowns follow a series of large-scale, multi-agency investigations targeting telemedicine fraud and abuse. In fact, over the past two years, the DOJ, OIG, FBI, CMS, and U.S. Attorneys General across the country have pursued enforcement actions connected to billions of dollars in alleged losses.

In September, the U.S. DOJ announced criminal charges against nearly 140 defendants across the country for their alleged participation in fraud schemes responsible for over $1.4 billion in losses.

In August, an announcement from the U.S. Attorney’s Office in Michigan revealed regulators’ intense targeting of cancer genetic testing (CGx) labs and DME companies, as well as an ongoing investigation known as Operation Happy Clickers – named after the implicated providers who approved illegitimate orders with little to no review.

In the waning aftermath of a pandemic that has spurred a surge in telehealth services, there’s no question that federal regulators will continue to protect Medicare and Medicaid program integrity through calculated takedowns, audits, fraud investigations, and whistleblower / qui tam claims. These actions can subject defendants to sizable settlements and fines, Medicare exclusion, and severe penalties under the False Claims Act (FCA), Anti-Kickback Statute (AKS), Stark Law, and EKRA. In some cases, they put significant prison time on the table.

Four providers named in the release, a nurse practitioner (NP) and three doctors from Michigan, agreed to resolutions in which they admitted to signing unnecessary orders to the tune of over $7.3 million.

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The Happy Clickers investigation, which involved parallel criminal and civil investigations, is ongoing and regulators are seeking involvement from whistleblowers.

The nationwide enforcement action, coordinated by the National Rapid Response Strike Force, also included millions in fraud related to COVID-19, substance abuse treatment facilities, and illegal opioid distribution schemes.

According to the DOJ press release, a whopping $1.1 billion of those losses involved schemes in which telehealth companies paid physicians and NPs to order unnecessary DME, genetic and diagnostic testing, and pain medications with no patient interaction or only brief telephone-only consults with patients whom they had never seen or met. DME suppliers, labs, and pharmacies then purchased orders in exchange for illegal kickbacks and submitted claims to Medicare and other government payers.

Healthcare providers: Are you concerned about telehealth or telemedicine compliance? Call (713) 909-7323 or contact us online to schedule a consultation with an experienced health law attorney.

As expected in a post-pandemic era, health care enforcement agencies have turned their attention to combatting telehealth and telemedicine fraud schemes. Over the past few months, The United States Department of Justice (DOJ), the HHS-OIG, FBI, and several U.S. Attorney Offices have announced enforcement actions involving billions of dollars in alleged losses, with a special focus on durable medical equipment (DME) companies and medical labs.

This includes an April 2019 takedown that resulted in a slew of federal indictments against DME marketing executives and CMS administrative action against 130 DME companies involved in a telemedicine scheme, as well as Operations Double Helix and Brace Yourself, which implicated dozens of providers, CGx labs, and telemedicine companies in schemes that fraudulently billed Medicare over $2.1 billion – making it one of the largest health care fraud schemes ever charged. Many other takedowns targeting illegal opioid prescriptions have also uncovered large schemes connected to telemedicine.