Cancer doctors, lab settle kickback claims
A San Antonio oncology practice, its affiliated physicians and a clinical laboratory have agreed to pay more than $4 million to settle civil allegations that they were involved in an unlawful kickback scheme.
The federal government alleged that Oncology San Antonio PA and Corepath Laboratories violated the False Claims Act, a law intended to combat fraud against the United States.
The lab, which provided bone marrow biopsy services at Oncology San Antonio’s locations, agreed to pay $115 for each biopsy referred by the practice and its physicians, the federal government alleged. Those payments, the United States added, constituted payments under the Anti-kickback Statute. The law prohibits offering, paying or receiving payments to induce referrals of items or services covered by a federal health care program.
The payments for each referred biopsy were paid to the private practice entities of three Oncology San Antonio physicians, according to a statement Tuesday from the U.S. Attorney’s Office.
In a statement, Corepath said it has fully cooperated with the government’s investigation and is implementing controls and training to prevent “impermissible activities in the future.”
“The company has accepted full responsibility for and voluntarily terminated an agreement underlying the government’s investigation,” Corepath added.
Oncology San Antonio did not respond to a request for comment. There was no determination of liability under the settlement.
“Illegal financial incentives to physicians undermine the integrity of our health care system and impair the objective judgment of the community’s health care professionals,” U.S Attorney Jaime Esparza said.
Whistleblower
The settlement also resolves a whistleblower lawsuit brought under the False Claims Act by Dr. Slavisa Gasic, who had worked at Oncology San Antonio as a nonowner physician from 2011 to early 2016.
Gasic alleged that Dr. Jayasree Rao, an oncologist and hematologist who has been a member of Oncology San Antonio, billed Medicare and Medicaid for services that were medically unnecessary or that were provided in violation of
medical guidelines.
Oncology San Antonio’s website says Rao, 55, retired from practicing medicine last month “due to personal and health-related reasons.”
The civil settlement, announced by the Justice Department, is with the federal government and the state of Texas.
Oncology San Antonio and its physicians agreed to pay $1.3 million, while Corepath agreed to pay more than $2.7 million plus interest to settle the case.
Whistleblower awards can range from 10% to 30%, so Gasic could receive more than $130,000 from the settlement with Oncology San Antonio and its physicians. Gasic’s complaint made no mention of Corepath, so he would not receive anything from that settlement.
“Dr. Gasic … is to be commended for coming forward when he saw wrongful practices and reported them,” said G. Allan Van Fleet, a Houston lawyer who represents the doctor. Gasic, who is in his late 50s, now works for the VA Central Texas Healthcare System in Temple.
‘Unnecessary treatments’
Gasic alleged that Rao treated patients for “serious malignancies despite the absence of diagnostic criteria necessary for that diagnosis.”
The lawsuit cited a handful of examples. An individual, described as “Patient 2,” showed no substantial abnormalities from a bone marrow biopsy, but Rao issued a diagnosis of lymphoma and “then prescribed and administered an unnecessary
two-year course of chemotherapy.”
Rao also would give “unnecessary and ineffective treatments” to patients with stage 4 malignancies “who were clearly at the end stage of cancer and needed to be in hospice,” Gasic alleged.
The settlement resolved allegations that Rao provided and billed for medically unnecessary tests, services and treatments to Medicare, Tricare and Texas Medicaid patients in the San Antonio area.
In 2017, she ran afoul of the Texas Medical Board, which found that she improperly advertised on her website and in her profile on the state agency’s website that she was board certified when she is not. Board certification signifies the highest
level of accreditation within a specialty. She agreed to settle the matter without admitting or denying the allegations.
Rao and her practice has entered into a three-year “integrity agreement” with the U.S. Department of Health and Human Services Office of Inspector General. The agreement is not on the inspector general’s website, but such agreements generally outline future compliance obligations.
The inspector general entered into a corporate integrity agreement with Corepath in December. Under the agreement, which is posted on the OIG’S website, Corepath had 90 days to develop and implement policies and procedures for compliance with the Anti-kickback Statute.