Millionaire docs accused of Medicare overbilling, fraud

Two doctors--whose combined Medicare earnings in 2012 approached $30 million, according to recently-released government payment data--have been accused of overbilling and fraud, Bloomberg reported.

Florida ophthalmologist Salomon Melgen earned $20.8 million from Medicare in 2012. A 2009 ruling found he overcharged Medicare by $8.9 million for multidosing the injectable macular degeneration drug Lucentis (Ranbizumab). This drug is manufactured by a company that pays large rebates to doctors, according to The New York Times. Moreover, many ophthalmologists consider the cheaper drug Avastin as an appropriate equivalent to Lucentis. If Melgen had used Avastin instead, his Medicare billings for the shots would have dropped from $11.8 million to under $500,000, Wall St. Cheat noted.

Melgin's case raises questions about the appropriateness of certain Medicare reimbursement policies. Ophthalmologists, for example, have an incentive to use expensive drugs since Medicare pays doctors 106 percent of their cost, CNN reported. Doctors pay the pharmaceutical company for the medication and pocket the overage.

Melgen also is part of a federal public corruption probe focusing on whether U.S Senator Robert Menendez (D-N.J.) inappropriately intervened in Melgen's Medicare overbilling case, the Times reported. Melgen was the top political donor for Menendez in his 2012 re-election campaign, the Associated Press noted.

Another doctor in legal trouble is Farid Fata, a Michigan oncologist who received over $10 million from Medicare in 2012; he was the highest paid oncologist out of more than 7,300 specialists in his field. Fata was arrested in August for submitting false claims, Bloomberg reported. He's accused of billing patients in remission for chemotherapy, purposefully misdiagnosing beneficiaries with cancer to justify chemotherapy and fabricating diagnoses as reasons for ordering hematology treatments. Fata also reportedly delayed emergency care for some patients with serious conditions until he could render and claim payment for chemotherapy, the article stated.

Jailed since his arrest, Fata's trial is set for August. He pleaded not guilty to federal fraud charges.

Besides exposing potential fraud by highly-paid providers, the Medicare payment data may highlight losses resulting from the illegal practice of self-referral, where practitioners send patients for testing in their own offices or affiliated clinics.

For more:
- see the CMS payment provider payment data
- here's the Bloomberg article
- read The New York Times article
- see the AP article
- here's the Wall St. Cheat Sheet article
- read the CNN article

Suggested Articles

The HHS OIG is asking for an additional $23.7 million to support fraud oversight that has benefited from an emphasis on data analytics.

A New York surgeon was sentenced to 13 years in prison for fraud and more physician practice news from around the web.

A federal judge has ruled that the U.S. government’s remaining fraud case against UnitedHealth can move forward.