As we have discussed previously (ADSflorida.com/articles search: Upcoding or Gotcha!), there is a continuing increase in vigilance of professional practices at both the federal and state levels. It has become increasingly apparent that professional practices are being scrutinized for irregularities in billings and tax returns as well as claims on their patients’ insurance plans. We have long advocated that each practitioner should strongly reconsider deviations from industry norms for practice expenses, as well as insurance filings, no matter how well they seem to be hidden. Both are not that difficult for an experienced auditor to notice, but the stories continue to seemingly publish themselves. So, let’s look at two more and consider the potential risks for your practice.

CASE ONE
Scott D. Geise, D.D.S.
Newfane Family Dentistry
Newfane, New York

Dr. Geise pled guilty to filing a false healthcare claim and a false tax return and was indicted on 57 felony counts in 2007. According to the U.S. Attorney’s Office, Dr. Geise long maintained his innocence in the case until his trial began, but then admitted the fraudulent schemes.

According to the U.S. Attorney’s Office, Dr. Geise billed a patient’s insurance company for a mouth guard instead of a bleach-whitening kit requested by the patient, because the whitening kit was not covered by insurance. Dr. Geise also defrauded the insurance plans of General Motors and Delphi by billing for amalgam fillings when he only applied sealants (the plans covered amalgams but not sealants).

Dr. Geise also admitted that he failed to record cash receipts as income on corporate tax returns, failed to report more than $188,000 in income, and then failed to pay the additional corporate and personal taxes on the unreported income. Dr. Geise was ordered by a federal judge to repay $40,023 to the insurance companies he defrauded and $87,782 to the Internal Revenue Service for taxes he owed.

The second case considers how one orthodontist managed multiple locations and staff.

CASE TWO
Michael Goodwin, D.D.S.
Goodwin Orthodontics
Amarillo, Texas

Texas Attorney General’s Medicaid Fraud Control Unit received information in 2009 that Dr. Michael Goodwin was billing Medicaid for work done by his assistants — some of whom, according to an affidavit, were unlicensed and performing while he was out of town. From April 2008 through April 2011, authorities allege Goodwin filed more than 20,000 fraudulent claims with Medicaid worth more than $1.6 million. FBI and state investigators monitored Medicaid claims, collected bank records and interviewed Goodwin and current and former employees during their investigation. Employee interviews and airline tickets revealed Goodwin spent half of each month at another practice in Indiana, but Goodwin still submitted claims for services he supposedly rendered or supervised in Amarillo. Agents allege Goodwin hired a substitute orthodontist to be on duty in Amarillo while Goodwin was in Indiana, but that person never supervised any procedures, was not a Medicaid provider, and never recorded information in patient charts.

Agents allege it was assistants who put on and took off braces, made adjustments and fixed broken brackets. Agents also said they interviewed 10 patients who did not recognize the substitute orthodontist’s photograph and also reported “they rarely saw Dr. Goodwin, and it was the assistants who did nearly all the work.”

Lisa Jones, director of enforcement for the Texas State Board of Dental Examiners, said practicing dentistry without a license is a third-degree felony in Texas, and “That certainly can be prosecuted by local law enforcement.” Dental assistants hold registrations with the state that allow them to provide radiographic services. Jones further said that if someone is offering services above and beyond that, they could face administrative action after an investigation.

In a report issued earlier this year, the Government Accountability Office, the investigative arm of Congress, said Medicaid is a high-risk program because of its vulnerability to fraud, abuse and improper payments. In fiscal year 2010, the federal government estimated Medicaid and Medicare made more than $70 billion in improper payments, the GAO’s report said.

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Of course, these cases do not represent the majority of practices. However, the frequency of these stories indicates that there is more going on than anyone would have imagined in the past. Each dentist has the ethical and legal responsibility to ensure the integrity of treatment provided to patients as well as correctness of the insurance billing process. Thinking that it’s ok “because everyone does it” is not a defense. It is obvious in these cases that there was specific intent to defraud, but even negligence is grounds for investigation. Filing falsified tax returns can ultimately be very costly in back taxes and penalties, and committing insurance fraud can cost you more than a fine. It can cost you your license to practice, which could be the worst transition option, or plan, of them all.