Personal Care Services Remain an Enforcement Focus: Prosecutions and Civil Settlements Still Going Strong
The U.S. Department of Health and Human Services, Office of Inspector General (“OIG”), has made pursuing fraud in the personal care services (“PCS”) sector a top priority, including making it a focus of their FY2017 workplan.
Last week, OIG released a report, Medicaid Fraud Control Units Fiscal Year 2016 Annual Report, which set forth the number and type of investigations and prosecutions conducted nationwide by the Medicaid Fraud Control Units (“MFCUs”) during FY 2016. Overall, the MFCUs reported 1,564 convictions, over one-third of which involved PCS attendants; fraud cases accounted for 74 percent of the 1,564 convictions.
Looking at data released by HHS, PCS was the largest category of convictions reported in FY 2016. Thirty-five percent (552 of 1,564) of the reported convictions were of PCS attendants, representatives of PCS agencies, or other home care aides. Of these 552 reported convictions, 500 involved provider fraud and 52 involved patient abuse or neglect. Of the reported fraud convictions, PCS attendants accounted for the greatest number of fraud convictions (464 of 1,160).
The emphasis on PCS is likely to not only continue, but increase in 2017. Notably, recent high-profile investigations and prosecutions this year include the following cases:
Six Missouri home health and personal care aides and patients were charged on April 4, 2017, with making false statements to Medicaid. The aides and patients allegedly falsified documentation that claimed the aides were providing services to the patients at particular times when, in fact, no such services occurred. According to the indictments in the case, one defendant patient was vacationing in New Orleans and on a cruise during the times she supposedly received services. One aide was found gambling at a casino during the same time period she claimed to be providing services. The investigation was led by the Kansas City, Missouri office of the OIG and the MFCU of the Missouri Attorney General’s Office.
On March 30, 2017, Godwin Oriakhi, the owner and operator of five Texas-based home health agencies pleaded guilty to conspiring to defraud Medicare and Texas Medicaid programs. Oriakhi, along with his co-conspirators, pleaded to defrauding the state and federal governments of over $17 million, the largest home services-based (including both home health services and PCS) fraud in Texas history. Oriakhi admitted that he and several co-conspirators, including his daughter, paid illegal kickbacks to physicians and patient recruiters in exchange for patient referrals. The defendants also paid patients to receive services from Oriakhi’s agencies and in exchange for the use of the patients’ Medicare and Medicaid identification numbers to bill for home health and PCS services.
Given that HHS is securing large monetary recoveries in this space, there is clearly an incentive for HHS to focus on the PCS sector. Indeed, the recent HHS report notes that MFCUs recovered an average of over $7 for every dollar spent towards investigation and prosecution of healthcare fraud cases, including PCS cases, in FY2016.
 https://oig.hhs.gov/oei/reports/oei-09-17-00210.asp (hereinafter “Report”)
 Report at 6.
 Report at 7.