Get in a car wreck or have a broken bone set and its not unusual to have your doctor order some physical therapy to make sure you heel properly. When we go the therapy appointment, we don’t think twice about the qualifications of the therapists. They are working for the doctor, after all.
A former employee of Baldwin Bone & Joint in Baldwin County, Alabama accused his former employer of a wide range of fraud including using unqualified therapists. When no one at work would listen, he turned to the False Claims Act and filed a whistleblower lawsuit in federal court. That was in 2015. Today the clinic agreed to pay $1.2 million to settle the charges. The former employee, John Seddon, will receive $200,000 for stepping forward and blowing the whistle.
Clinic Regularly Employed Unqualified Therapists
Seddon was employed as an exercise physiologist in the physical therapy department of Baldwin Bone from 2007 through 2015. Although Seddon has a bachelor’s and master’s degree in physiology, he had no formal training in physical therapy, was not a licensed physical therapist, and was not a licensed physical therapist assistant. He claimed he was repeatedly asked “to provide hands on physical therapy services and treatments to patients on a daily basis.”
Medicare regulations say that therapy should be performed by a licensed physical therapist. Seddon says that when he, another physiologist or an assistant was directed to treat a patient, they were also told to leave the name of the person of the performing the service blank. A licensed physical therapist would later initial any logs and treatment notes as if he or she had actually treated the patient.
Seddon said that he began to get suspicious of how the PT program at Baldwin Bone & Joint was being run around June of 2015. According to court records, he began
“investigating the practices that he believed to be potentially unlawful and gathering relevant documents. He paid careful attention to patients’ Exercise Logs, Daily Treatment Sheets, and Fee Tickets to try to determine how often the PTs signed off on treatments they did not personally perform. [Seddon] observed treatment
records that had been arbitrarily changed after treatments had been rendered, functional limitations notes that were added after the fact, and unusual annotations made by the billing department that led him to believe records were being changed. In order to preserve this evidence [Seddon] began copying some of these aberrant documents and taking them home.”
Shortly after sharing his concerns he was terminated.
Unfortunately, in many of our cases we see whistleblowers who suffer retaliation for speaking up. Thankfully Congress and most states have tough anti-retaliation laws that provide double lost wages and attorneys fee for workers who are wrongfully terminated for blowing the whistle.
Other Medicare Fraud Violations at Baldwin Bone & Joint
Thus far we have discussed the use of unqualified therapists at the clinic. It’s hard for the clinic to argue that the violations were mere oversights since Seddon says he was directed to not sign or initial the treatment records.
Using unqualified healthcare workers constitutes Medicare fraud. But Seddon says that wasn’t all that was going on. According to him. He says the clinic was also:
- Performing and billing for physical therapy services and treatments incident to physicians services performed byPhysical TherapyAssistants (“PTAs”), the Relator, and Athletic Trainers (“ATs”);
- Performing and billing for physical therapy services in excess of the annual limit imposed by Medicare (“the cap”) without properly evaluating, certifying, and providing written medical justification that patients qualify for an exception;
- Performing and billing for physical therapy services and treatments performed under deficient evaluations and care plans that are not properly certified and contain generic short and long term goals and little or no measurable expected outcomes;
- Performing and billing for physical therapy services and treatments that require a specific level of supervision without actually providing that level of supervision;
- Performing and billing for physical therapy services with inadequate and/or false documentation in the patient’s medical records used to justify the services billed; and
- Making improper referrals and paying kickbacks for medical, imaging, and physical therapy services.
Healthcare workers will know immediately what Seddon is saying. In addition to billing for unqualified people, Baldwin Bone & Joint was allegedly billing for medically unnecessary services and paying kickbacks. Both practices are highly illegal.
Medicare Fraud – Kickbacks
Although Baldwin Bone was allowed to pay the fine without admitting any guilt, the Justice Department issued a statement indicating, “The Stark Law allegations concerned BB&J’s direct compensation arrangements with its shareholder physicians, namely, that those arrangements violated the Stark Law because the compensation BB&J paid to its shareholder physicians directly or indirectly related to the volume of each shareholder physician’s referrals for designated health services such as physical therapy, X-rays and MRI’s.”
The Stark Law is actually a series of laws that prohibit doctors from referring a Medicare or Medicaid patient to a business if they or a family member have a financial interest in the business.
That means the orthopedists that own Baldwin Bon & Joint can’t send their patients to an MRI center if they or a spouse owns the business. In passing these laws, Congress wanted to make sure that healthcare decisions were based on the needs of the patients and not on the financial needs of the physician.
Medicare Fraud – Billing for Unnecessary Services
We are always most concerned when we hear that a doctor is pushing unnecessary medication, surgery or treatment on patients. We have seen cases where doctors have been performing heart surgery on patients that didn’t need it! One physician is serving 45 years in prison for telling healthy patients they had cancer and then putting them through expensive and dangerous chemo!!
Thankfully, the services at issue in this case were physical therapy. There is a very low risk that a patient will be hurt by too much therapy. It is still an inconvenience for the patients and a rip off. For private pay patients, there could be high deductibles and co-pays too.
Speaking to the charges against Baldwin Bone, Medicare’s chief law enforcement officer, Special Agent in Charge Derrick Jackson, said, “Providers who falsely bill Medicare for services they didn’t provide, as alleged in this case, not only harm their patients, they also hurt all beneficiaries who depend on Medicare funding to provide access to quality services.”
Harking back to lessons learned from my grandparents, I bring up that old adage “Where there is smoke, there is fire.” To be clear, there are no allegations that any of the physician owners of Baldwin Bone performed unnecessary surgeries. As a physiologist working in the physical therapy department, he wouldn’t know. The only ones who know are the doctors themselves.
We note from public records that until this scam came to light, compared to 21,204 other orthopedic surgeons that Medicare paid, co-owner Dr. was in the 91st percentile for Medicare compensation nationally. Does this mean he is performing unnecessary surgeries? We have no idea and are certainly not making any accusations. But if you are defrauding Medicare by billing for unnecessary therapy where did the doctors at the clinic draw the line? Where did the medically unnecessary services stop?
Whistleblower Rewards for Medically Unqualified Therapists
As this post demonstrates, Medicare fraud can take many different shapes and forms. If you are working for a medical clinic, doctor’s office or hospital and have knowledge of unqualified therapists or doctors performing services, contact us. We can help you put and end to the illegal behavior and collect a cash whistleblower reward.
How much of a reward? John Seddon will receive $200,000 for his efforts.
The federal False Claims Act pays rewards of 15% to 30% for information about Medicare and Tricare fraud. It also covers the federal match of Medicaid.
Over half the states have their own whistleblower reward law that covers state funded Medicaid. If a clinic has both Medicaid and Medicare patients, it is common to receive two rewards. In addition to the cash, of course, is the knowledge that you are protecting taxpayers and often patients.
For more information, visit our Medicare fraud whistleblower information page. Ready to see if you have a case? Contact us online, by email or by phone, 202-800-9791. The consultation is free and if we take your case, we only get paid if you get paid. We accept cases in all 50 states.
You can always contact Medicare directly at 1-800-MEDICARE. Using a hotline, however, does not qualify you for a reward. The only way to get a reward is through filing a sealed complaint in court through the False Claims Act. For many, that process sounds like a hassle. It isn’t. We investigate, file the complaint and even prosecute if necessary.