Former Greenville CEO, Employees Indicted in Multi-Million Dollar Health Care Fraud Scheme
GREENVILLE, S.C. — A federal grand jury has indicted the former owner and two high-level employees of a Greenville-based medical laboratory on charges of health care fraud, alleging they bilked millions from federal health programs through a scheme involving manipulated COVID-19 testing, the U.S. Attorney’s Office for the District of South Carolina announced Wednesday.
Kevin S. Murdock, 56, of Greenville; Thomas C. Lee, 56, also of Greenville; and Vidhya V. Narayanan, 45, of Atlanta, face a 16-count indictment charging them with health care fraud and conspiracy to commit health care fraud.
According to the indictment, Murdock owned and operated Premier Medical Laboratory Services, which offered diagnostic testing, including COVID-19 tests. Prosecutors allege the defendants devised a multi-part scheme to fraudulently generate revenue from pandemic-related health care programs.
The scheme allegedly involved submitting false claims to the federal government for individual tests when, in reality, the tests had been pooled together for combined, faster processing. The defendants also allegedly manipulated test processing software. As a result, prosecutors say, the defendants billed for tests that were “virtually worthless and ineligible for reimbursement.”
The conspiracy generated millions in fraudulent proceeds, according to the indictment.
“The defendants exploited a public health emergency for personal gain,” the U.S. Attorney’s Office said in a statement.
Each defendant faces a maximum penalty of 10 years in federal prison, a fine of up to $250,000, and three years of supervised release if convicted.
In a related civil action, Murdock previously agreed to a consent judgment of $27,544,460, acknowledging there is a likelihood he would be found liable for violating the False Claims Act and similar state laws. The civil case was brought by the United States and the states of Colorado, Georgia, and South Carolina.
The charges contained in the indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Find These & More @Macy’s
Aetna to Pay $117.7 Million to Settle False Claims Act Allegations Over Medicare Advantage Diagnoses
Aetna Inc. has agreed to pay $117.7 million to resolve allegations that it knowingly submitted inaccurate diagnosis codes for Medicare Advantage enrollees to inflate payments from the federal government, the Justice Department announced Wednesday.
The settlement resolves claims that the national insurer violated the False Claims Act by submitting or failing to withdraw untruthful patient diagnosis data to the Centers for Medicare & Medicaid Services (CMS), and by falsely certifying the data as accurate.
Under the Medicare Advantage (Part C) program, beneficiaries may opt out of traditional Medicare and enroll in private plans offered by insurers like Aetna. CMS pays these plans a fixed monthly amount adjusted for risk factors, paying more for sicker beneficiaries expected to incur higher healthcare costs. The payments are based on medical diagnosis codes submitted by the insurers.
The United States alleged that for payment year 2015, Aetna operated a “chart review” program in which it paid coders to review medical records and identify all supported medical conditions. Aetna used the results to submit additional diagnosis codes to obtain higher payments, but allegedly ignored instances where the same chart reviews showed that previously reported codes were unsupported and should have been withdrawn—which would have required repaying CMS.
“The government pays private insurers over $530 billion each year to care for Americans enrolled in Medicare Advantage,” said Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “We will continue to hold accountable insurers that knowingly submit inaccurate or unsupported diagnoses to improperly inflate reimbursement.”
The settlement also resolves allegations that for payment years 2018 to 2023, Aetna knowingly submitted or failed to delete inaccurate diagnosis codes for morbid obesity. The government contends Aetna submitted codes for beneficiaries whose recorded Body Mass Index (BMI) was inconsistent with a morbid obesity diagnosis, resulting in inflated payments.
“Medicare Advantage relies on accurate reporting and attempts to manipulate the system undermine both the program’s integrity and the beneficiaries it serves,” said Scott J. Lampert, Acting Deputy Inspector General for Investigations at the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “Those who seek to exploit Medicare Advantage should expect to be identified and held responsible.”
The civil settlement related to morbid obesity resolves a whistleblower lawsuit filed under the False Claims Act by a former Aetna risk-adjustment coding auditor. The whistleblower will receive $2,012,500 from the settlement amount.
The case, United States ex rel. Mary Melette Thomas v. Aetna Inc., et. al., was filed in the U.S. District Court for the Eastern District of Pennsylvania.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
