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Date: 02-24-2023
Case Style:
Natasha Lyons, ex rel. United States of America v. Cornerstone Healthcare Group Holding, Inc. and CHG Hospital Medical Center, LLC d/b/a Cornerstone Hospital Medical Center
Case Number: 3:18-cv-00302
Judge:
Court: United States District Court for the Southern District of Texas (Harris County)
Plaintiff's Attorney:
Defendant's Attorney: Not Available
Description: Houston, Texas commercial litigation lawyers represented Defendants charged with Medicare Fraud.
Cornerstone Healthcare Group Holding Inc. and CHG Hospital Medical Center LLC. dba Cornerstone Hospital Medical Center have agreed to pay the United States $21,637,512 to resolve claims that the company improperly billed Medicare.
“Taking advantage of the elderly and infirm is disgraceful,” said Hamdani. “When providers accept federal funds for reimbursement, they have a duty and responsibility to provide the necessary and best care possible to the patient. As one of the largest of its kind in our district, this settlement shows our commitment to protecting our most vulnerable citizens and the integrity of the Medicare system.”
Cornerstone Medical Center was formerly a long-term acute care facility located in Houston that operated as a long-term care hospital. Cornerstone was in the business of providing extended medical and rehabilitative care to individuals who qualified as clinically complex and possessed multiple acute and/or chronic conditions. Through its subsidiaries, CHG Holding operated specialty hospitals throughout the United States, including Cornerstone Medical Center which is no longer in business.
The investigation began when a qui tam aka whistleblower lawsuit was filed under seal Sept. 28, 2018. The individual filing the suit worked at Cornerstone Medical Center long term care facility. During the relator’s employment, they witnessed, among other things, unlicensed, unauthorized students of Drs. Jorge Guerrero, Joel Joselevitz and Joseph Varon rendering medical procedures. These unauthorized and improper services were fraudulently billed to Medicare.
In addition, Cornerstone Medical Center submitted claims for payment for services certain treating physicians allegedly rendered. However, records showed those physicians were actually out of the country and could not have performed the services.
Finally, the investigation concluded that from Jan. 1, 2012, through Dec. 31, 2018, Cornerstone Medical Center billed for services not supported by the patients’ diagnosis or medical records, and billed for services that were either not rendered or were so inadequate they were worthless (in some cases, resulting in harm to patients.) The claims for payment to Medicare for those services were deemed to be fraudulent and submitted in violation of federal law.
“Submitting improper claims to Medicare compromises the financial security of the program and wastes valuable taxpayer dollars,” said Acting Special Agent in Charge Korby R. Harshaw of Department of Health and Human Services - Office of Inspector General (DHHS-OIG). “We will continue to work alongside our law enforcement partners to protect the integrity of federal health care programs and to hold bad actors who exploit them accountable.”
“This $21.6 million settlement by Cornerstone Healthcare Group Holding is one of the largest civil healthcare fraud settlements FBI Houston has seen, and we work a lot of healthcare fraud cases. I hope this case sends a message to other healthcare providers who think they can get away with similar fraud,” said FBI Special Agent in Charge James Smith. “Not only did Cornerstone Healthcare bilk the Medicare program out of millions of dollars, it also took advantage of its patients who were unknowingly used for its scam. These patients trusted their doctors and healthcare providers and ultimately received little to no care. At the end of the day, health care fraud affects everyone. It raises our health insurance premiums and exposes patients to worthless and unnecessary medical procedures. I’m proud of the work our FBI Houston Healthcare Fraud Task Force has done.”
Under the False Claims Act, a private party known as a relator can file an action on behalf of the United States and receive a portion of the recovery. In this case, the relator will receive $4,327,502.
The U.S. Attorney’s Office, DHHS-OIG, FBI and Department of Defense conducted the investigation.
Outcome: Defendants agreed to pay $21,637,512 to settle the claims made against them.
Plaintiff's Experts:
Defendant's Experts:
Comments: