June 22, 2024

A chronic disease management provider with several offices in Florida has agreed to pay $14.9 million to resolve alleged false claims.

The U.S. Department of Justice said that Bluestone Physician Services of Florida LLC, Bluestone Physician Services, P.A. and Bluestone National LLC, operating in Florida, Minnesota and Wisconsin, respectively, agreed to the settlement recently.

The payment amounts to $14,902,000 to resolve allegations that the provider knowingly submitted claims for certain Evaluation and Management codes for services related to the management of chronic care patients in assisted living and other care facilities that were not provided in conformity with applicable Medicare, Medicaid and TRICARE requirements.

The federal government’s share of the settlement is $13,842,482 and $1,059,518 will be paid to the States of Florida and Minnesota. A corporate whistleblower involved in the case will be paid more than $2.8 million.

“Improperly billing federal health care programs depletes valuable government resources used to provide medical care to millions of Americans. We will pursue health care providers that defraud the taxpayers by knowingly submitting inflated claims.”

Principal Deputy Assistant Attorney General Brian M. Boynton

A services description on a Bluestone Physician Services web site said the company has provided residential care to elderly patients in assisted living, memory care and group home settings since 2006 and, in 2015, expanded care to Florida.

The corporate description also said that Bluestone has corporate offices in Tampa and Orlando and now serves communities in the Orlando, Jacksonville, Tampa, and Sarasota areas. A corporate map on Bluestone’s web site also shows connections further south through Charlotte and into Lee County.

“Improperly billing federal health care programs depletes valuable government resources used to provide medical care to millions of Americans,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will pursue health care providers that defraud the taxpayers by knowingly submitting inflated claims.”

The settlement resolves allegations that from Jan. 1, 2015, through Dec. 31, 2019, Bluestone knowingly submitted claims for two E&M codes, the domiciliary rest home visit code for established patients and the chronic care management code, that did not support the level of service provided.

“The submission of false claims to Medicare for chronic care services will not be tolerated in the Middle District of Florida,” said U.S. Attorney Roger B. Handberg for the Middle District of Florida. “This resolution sends a message to the provider community and to our district that we will actively investigate and prosecute this kind of conduct whenever it appears.”

In connection with the settlement, Bluestone has entered into a five-year Corporate Integrity Agreement with the Department of Health and Human Services, Office of Inspector General, which requires Bluestone, among other obligations, to establish and maintain a compliance program meeting certain requirements and to submit to an Independent Review Organization’s review of Bluestone’s Medicare claims to determine whether such claims were medically necessary, appropriately documented, and correctly coded.

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Lisa Loscalzo, the former General Manager for Bluestone’s Florida market. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery.

The civil settlement also includes the resolution of related allegations investigated by the U.S. Attorney’s Office for the District of Minnesota and Loscalzo will receive $2,831,380 in connection with the settlement.

The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section and the U.S. Attorneys’ Offices for the District of Minnesota and the Middle District of Florida, with assistance from HHS-OIG, the Defense Criminal Investigative Service and FBI.

The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, can be reported to HHS at 800-HHS-TIPS (800-447-8477).

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