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KUTV.com | Stories - Taxpayer 'Rip-Off' In Utah Medicaid Fraud
Thursday, February 27 2014, 08:49 PM MST
Taxpayer 'Rip-Off' In Utah Medicaid Fraud
(KUTV) A low-profile investigative body is taking credit for recovering huge amounts of Utah taxpayer money from alleged purveyors of Medicaid fraud.

"To date, we've collected over $50 million…over five years," said Robert Steed, director of the state Medicaid Fraud Control Unit---a 13 person office made up of lawyers, investigators, and fraud examiners.  "The fraudulent activity is a rip-off of the taxpayer."

Fraud, said Steed, has manifested itself in "all areas of Medicaid," including pharmaceutical companies promoting costly medications for other than approved purposes, providers overbilling Medicaid for their services, and care-givers exploiting patients.

Last week, a man who owned a now-closed transportation company, entered a guilty plea in state court on a "false claims" charge, in connection with allegations he billed Medicaid for car rides he did not give to recipients of the program.  The state said Christopher Troy Parkin agreed to pay $27,000, which will go back to Medicaid.

Investigator Coy Acocks said the people, for whom rides were billed, "lived with family members," and did not need transportation.  In one case, Acocks said a Medicaid recipient was in the hospital during a billed trip.

"These are our taxpayer dollars, and if you let this slide, how far does it go?" asked Acocks.

Apparently, overbilling has even extended to the state itself.   Several years ago, a performance audit found doctors at a State Department of Health clinic were charging too much for Medicaid, a practice known as "upcoding."  

"When we asked the department about this clinic, one of the responses we got back was that federal and state appropriations will cover any deficit the clinic runs, so billing patterns are not as critical for this clinic," the audit said.  "We believe that upcoding is wrong no matter the circumstances."

Steed said his office is still looking into those billing concerns, though the Department of Health told 2News its procedures are better today.

"The department has taken several steps to improve medical coding practices at its clinics, including regular training for staff and thorough reviews of all charts and billings," said spokesman Tom Hudachko. 

By far the biggest sums recovered for Medicaid---and thus taxpayers in Utah---according to Steed, have been from pharmaceutical companies.

In 2009, the Attorney General's Office held a news conference in which it displayed a mock-up of a $24 million dollar check from drug maker Eli Lilly, which Steed said had marketed the anti-psychotic medication, Zyprexa, for other than FDA approved uses. 

"We had drug companies marketing those to family practice doctors to treat ordinary depression," said Steed.  "These are serious drugs.  They're very expensive to the Medicaid system.  They have serious side effects."

Lilly cast the settlement as driven by its "desire to remain focused on the patients, caregivers and healthcare professionals" it serves.  In a statement, spokesperson Celeste Stanley said, "Lilly has a comprehensive compliance program that is designed to ensure that the company's global business practices fully comply with all laws and regulations."

Eli Lilly paid---including $1.4 billion in a federal settlement over similar claims---but not every accusation leads to prosecution, plea deals, and pay-outs.

"You know in my heart, I had known I hadn't done anything wrong," said Dr. Taj Becker, a neurologist in St. George, who successfully fought a state allegation in the late 90s that she overbilled Medicaid.  "It was very difficult on my family.  It was very difficult on me."

Dr. Becker said investigators had told her to make "$107,000 in payments, fines and investigative costs," and that there was a not-so-subtle threat attached to the demand.

"Then they mentioned it could involve press exposure, prison, loss of license, besides a lot more money," Becker told 2News. 

She said she refused to pay, that charges against her were dismissed, and that an administrative judge found she owed no money to the Medicaid program.  She, in turn, sued state officials and in 2010, won defamation verdicts against two of them.  Today, she no longer accepts Medicaid patients.

"The risk financially and personally, and yeah prosecution, it's just…too dangerous," she said.

"We do not call the cavalry over the hill on a slight provocation," said Steed, who joined the Medicaid Fraud Control Unit years after allegations were leveled against Dr. Becker.  He said the office, now, is not quick to diagnose criminal intent.  "We try to treat providers with dignity and respect."

Pending, now, is a case against the owner of a now-defunct local clinic, known as Westview.  A 22-count federal indictment last December accused Larohnda Dennison of health care fraud and making false statements, over allegations she signed up undocumented pregnant women for Medicaid.  Prosecutors said she caused Medicaid "to pay over $1,000,000…under false and fraudulent pretense."

"I can tell you that my client adamantly denies the charges against her," said Dennison's attorney, Tara Isaacson.  "We are preparing to defend her in court."

"Maybe I'm an optimist," said Assistant Attorney General Kaye Lynn Wooton, assigned to the Medicaid Fraud Control Unit.  "But I think it's very significant that, no matter what, if you bill for services not provided, or you take advantage of the Medicaid system, we'll attempt to get to the bottom of it." 

By Brian Mullahy

(Copyright 2014 Sinclair Broadcasting Group)Taxpayer 'Rip-Off' In Utah Medicaid Fraud

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