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07/16/19
A California appellate court rejected a chiropractor’s challenge to his conviction and sentence for his role in a workers’ compensation fraud conspiracy.
07/16/19
A California appellate court rejected a chiropractor’s challenge to his conviction and sentence for his role in a workers’ compensation fraud conspiracy. In the case of People v. Pierce, Dolphus Dwayne Pierce, a chiropractor, and Tomas Ballesteros Rios, a physician, operated the P&R Med-Legal Medical Corp. P&R contracted with physicians to perform examinations of workers’ compensation patients and dispense prepackaged medications with little or no regard for medical need. P&R also contracted with a company owned by Rios’ sister, to prepare and submit canned medical reports and bills to workers’ compensation carriers. The bills sought payment for inflated drug dispensing and services, some of which were never actually performed.
Pierce, Rios, Rios’ sister and four others were indicted by a grand jury for conspiracy to commit insurance fraud. It was further alleged that the defendants damaged or destroyed property valued in excess of $3.2 million, and that they committed two or more felonies involving fraud or embezzlement.
Pierce was tried in 2015 and a jury found him guilty of participating in a conspiracy to commit insurance fraud, but acquitted him of the other charges. A judge sentenced Pierce to five years of probation and payment of restitution. The Court of Appeal for the 5th District of California said the trial judge did not err in denying Pierce’s demurrer to the complaint, as Pierce had received adequate notice of the accusations. The court additionally determined that Pierce was appropriately sentenced.
07/16/19
The Workers’ Compensation Appeals Board (WCAB) has announced plans to reorganize its Rules of Practice and Procedure. WCAB is reworking the organizational structure of the Rules which were initially adopted in 1966, as they no longer accommodate the number and complexity of Rules adopted in the modern era.
07/16/19
The Workers’ Compensation Appeals Board (WCAB) has announced plans to reorganize its Rules of Practice and Procedure. WCAB is reworking the organizational structure of the Rules which were initially adopted in 1966, as they no longer accommodate the number and complexity of Rules adopted in the modern era. In addition to reorganizing the rules, the Appeals Board said it would also eliminate duplicative rules, break up complex regulations, and simplify and modify regulatory language.
Under the proposed changes, medical-legal providers say their billing disputes would be put on hold until the case-in-chief is resolved. One area, designated as Section 10451.1, describes the process for medical-legal providers to pursue payments that are denied for reasons that are not subject to independent bill review. In addition to renumbering the rule as Section 10786, the WCAB is also proposing an amendment that would require the employer to file a declaration of readiness in the event of a dispute that is not subject to independent bill review, meaning the dispute is about more than whether the provider was paid according to the fee schedule. The proposed rules would require an employer or a carrier to file a declaration of readiness to proceed to a status conference within 60 days of receiving a provider’s objection to a denied payment. Once the defendant files the declaration, the med-legal provider would be added to the official address record.
04/10/19
Sacramento, CA – Dr. Laura Anderson, a neurosurgeon, has been charged with multiple counts of medical insurance fraud, workers’ compensation fraud, and grand theft after allegedly submitting over $500,000 in fraudulent medical services reimbursement claims to the State Compensation Insurance Fund.
04/10/19
Sacramento, CA – Dr. Laura Anderson, a neurosurgeon, has been charged with multiple counts of medical insurance fraud, workers’ compensation fraud, and grand theft after allegedly submitting over $500,000 in fraudulent medical services reimbursement claims to the State Compensation Insurance Fund.
Dr. Anderson was arrested and booked on these charges at the Sacramento County Jail. From 2013 to 2018, Dr. Anderson allegedly organized a fraudulent scheme of billing the State Compensation Insurance Fund for medical services she never provided her patients and upcoding of bills.
March 28, 2019
Dr. Sim Hoffman, a Buena Park based radiologist, will have been charged with crimes relating to workers’ compensation fraud for eight years by May 31st, the time of the trial.
March 28, 2019
Dr. Sim Hoffman, a Buena Park based radiologist, will have been charged with crimes relating to workers’ compensation fraud for eight years by May 31st, the time of the trial.
Early on, Hoffman tried to create a multi-specialty medical practice, including a sleep study center that was poorly run and had no qualified doctor on site. The sleep study reports were fabrications of medicine and the sleep technicians were seriously underqualified. One technician testified at the preliminary hearing while serving time for alcohol related infractions. Testimony revealed that this former technician had often appeared for work at Hoffman’s sleep center intoxicated.
Hoffman charged workers’ compensation payers for interpreting services, including all patients who had Spanish surnames. He used the license number of a certified interpreter who was not aware his license number was being used for billing and who did not perform the interpretations.
3-D MRIs were charged to the workers’ compensation payers but never performed. While Dr. Hoffman’s defense counsel argues that this isn’t true. However, testimony exists stating that Dr. Hoffman admitted he had “the software at home” and acknowledged it hadn’t been installed, yet on the bills, every MRI was charged as 3-D.
Beverly Mitchell, Hoffman’s former office manager, received a one-million-dollar severance package from Hoffman which was intended to keep her silence. Ms. Mitchell lied in depositions and in an arbitration hearing to cover-up for Dr. Hoffman and her perjuries were revealed during cross-examination at the preliminary hearing.
Prosecutor Shaddi Kamiabipour, after three demurrers, a writ of mandate, and a 995 motion filed by the defense, says she now simply needs to organize and get copies from the insurance companies.
March 18, 2019
The California Department of Insurance is holding an informal meeting Wednesday in Sacramento to discuss possible rules intended to improve fraud detection, investigation and referrals.
March 18, 2019
The California Department of Insurance is holding an informal meeting Wednesday in Sacramento to discuss possible rules intended to improve fraud detection, investigation and referrals.
A draft of proposed changes to rules governing investigative procedures would revise requirements for written policies and annual reports, clarify the information that needs to be included in fraud cases referred to the division, and revise the definition of what constitutes a “red flag.”
Red flag events that support an inference that insurance fraud has been committed would explicitly include “patterns or trends that indicate fraud, facts or circumstances present on a claim, and a behavior or history of person(s) submitting a claim or application,” under the division’s proposal.
The rules would require carriers to add the red flags, specific to their line of insurance, to mandatory written fraud-detection policies. Other proposed changes would require carriers to update written investigation procedures to specify how to conduct an investigation; a list of databases used in fraud investigations; how to preserve documents and evidence obtained during an investigation; and how to write a complete summary of an entire investigation.
Proposed rules would require the summary to answer questions including when the reporting party first suspected fraud, and what facts caused the reporting party to suspect fraud. The summary would also be required to identify the suspected misrepresentations and who made them, how the misrepresentations are material, as well as pertinent witnesses.
The division is also proposing to modify rules that allow carriers to hire contractors to perform special investigative unit duties. Among other things, the rules would limit how many layers of subcontractors can be involved in investigations. Carriers could hire contractors, contractors could engage subcontractors, and subcontractors could work with sub-subcontractors, under the proposal. But any agreement between a subcontractor and a sub-subcontractor would have to include a provision expressly prohibiting further contracting.
The division said the hearing is not part of formal rulemaking. Any changes would have to go through the process outlined in the Administrative Procedures Act, including another public hearing and comment period, before they could be adopted.
The public hearing to discuss possible changes to the SIU rules is from 1:30-3:30 p.m. Wednesday at the CDI Enforcement Branch headquarters, 2400 Del Paso Road, Suite 190, in Sacramento.
March 11, 2019
California’s Workers’ Compensation Appeals Board on Friday issued a significant panel decision finding the automatic stay on liens can apply to a company that is effectively controlled by a provider even if that person is not designated as an officer and does not own at least 10% of the firm.
March 11, 2019
California’s Workers’ Compensation Appeals Board on Friday issued a significant panel decision finding the automatic stay on liens can apply to a company that is effectively controlled by a provider even if that person is not designated as an officer and does not own at least 10% of the firm.
The appeals board said it agreed with a trial judge who found sufficient evidence to conclude liens filed by Firstline Health should be stayed. However, the WCAB also said Firstline was denied a fair hearing because it didn’t have sufficient notice or opportunity to rebut the declaration.
The case was remanded for further proceedings.
Lawmakers in 2016 passed Senate Bill 1160 requiring the Division of Workers’ Compensation to stay liens filed by or on behalf of criminally charged providers. In 2017, the Legislature passed AB 1422, a cleanup bill declaring the automatic lien stay also applies to companies that are controlled by criminally charged providers. The bill defined control to mean that the criminally charged provider was an officer or director, or was a shareholder owning 10% or more of the company.
The WCAB on Friday said control can also be established when a provider “held de facto ownership of the entity or de facto control consistent with the rights and duties of an officer or director of the entity.”
The DWC entered a notation in its Electronic Adjudication Management System indicating liens filed by Firstline may be subject to the automatic stay. The division determined the company was subject to the stay because it was controlled by Dr. Munir Uwaydah and chiropractor Paul Turley.
Los Angeles County prosecutors filed criminal charges accusing Uwaydah of paying attorneys and marketers up to $10,000 a month for referrals that were used to generate more than $150 million in fraudulent bills from Frontline Medical Associates, South Bay Surgical and Firstline.
Turley pleaded guilty in December 2018 to one count each of conspiracy to commit insurance fraud, insurance fraud, mayhem and unlawful patient referrals. As part of the plea agreement, Turley signed adeclaration saying Uwaydah owned or controlled many companies used in the scheme but listed other people as the owners.
The workers’ compensation judge who presided over a December 2018 trial cited the declaration in support of the finding of fact and order concluding Firstline’s liens should be stayed.
“The declaration goes on to state that this was all done intentionally so that Mr. Uwaydah could hide his ownership and his control from creditors, insurance investigators, government agencies and law enforcement,” the judge wrote. “He exercised absolute control over many companies, which included Firstline and Frontline. Therefore, it appears that Mr. Uwaydah had absolute control of Firstline Health despite other individuals such as Mr. Turley being named on the corporate documents.”
Firstline sought reconsideration of the Jan. 2 order. The company argued that Dr. David Johnson was the sole owner and officer of the firm. Although Johnson was indicted in September 2015 on charges that he participated in a compound drug kickback scheme at Landmark Medical Management, charges against him were dismissed in March 2017.
Firstline objected to the use of Turley’s statement, saying it was part of a plea arrangement in his criminal case and that the allegations were unproven. The declaration can’t be taken in lieu of testimony, the company argued.
February 25, 2019
February 25, 2019
Three women who say they were sexually assaulted by a qualified medical evaluator filed a class action lawsuit against the California Division of Workers’ Compensation, a carrier and two third-party administrators who the women say should have known about the doctor’s unsavory reputation.
The women, who are identified as Jane Doe 1, Jane Doe 2 and Jane Doe 3, say they were sexually harassed during exams with Dr. John D. Warbritton III, who was a QME and also a popular agreed medical evaluator. Warbritton pleaded guilty in May 2018 to transporting child pornography and was sentenced to 84 months in federal prison.
A grand jury indicted Warbritton in October 2016. The indictment was unsealed later that year. Warbritton surrendered his medical license in 2017 and was suspended from the California workers’ compensation system in January 2018.
According to the complaint, the DWC had a “special relationship” with Warbritton because it certified him as a QME. Travelers Indemnity Co., and TPAs JT2 Integrated Resources and York Risk Services Group, had a special relationship with the doctor because they required the women to be examined by him as part of their workers’ compensation claims, according to the complaint.
“The defendants either knew or should have known about Warbritton’s tendencies, as his behavior was well known to both the staff of the clinic and to the workman’s compensation attorneys who worked with him,” the complaint says. “Defendant Warbritton’s reputation was widely known to people in the industry.”
The complaint accuses the state, the carrier and the TPAs of negligence, misconduct, intentional and negligent inflection of emotional distress, and unfair business practices. It also accuses Warbritton of sexual harassment, assault, battery, sexual battery and gender violence.
The plaintiffs are seeking to represent a class of all women who were examined by Warbritton in his capacity as a QME.
February 6, 2019
Orange County prosecutors charged four more people with participating in the widespread capping scheme involving Providence Scheduling, including two qualified medical evaluators accused of operating a sham multidisciplinary clinic that paid more than $1.8 million for patient referrals over a five-year period.
February 6, 2019
Southern California prosecutors charged four more people with participating in the widespread capping scheme involving Providence Scheduling, including two qualified medical evaluators accused of operating a sham multidisciplinary clinic that paid more than $1.8 million for patient referrals over a five-year period.
The latest case in Orange County revolves around the Center for Better Health, a medical corporation that operated under the name Southland Spine and Rehabilitation Center Inc. The clinic operated in Costa Mesa from 2001 to 2017, while a second clinic in Riverside was running from 2011 until December 2015.
During that period, the clinic paid nearly $2 million in kickbacks for patient referrals from three companies that purport to operate as legal advertisers, according to a felony complaint filed with the Orange County Superior Court on Dec. 19. One of those companies, Providence Scheduling, has been convicted of a federal conspiracy and is implicated in additional criminal cases filed in Orange, Riverside and San Diego counties.
The Orange County District Attorney’s Office didn’t respond to questions about the alleged scheme, including how much workers’ compensation carriers were billed or actually paid for what prosecutors claim are kickback-tainted services.
According to the complaint, chiropractor Jeffrey Catanzarite incorporated the Center for Better Health, and held the positions of president and secretary. From 2011 to 2017, he employed Veronica Martin and Ronald Martin through their company, Priority One Health Resources, to run the marketing department for his clinic, according to the Orange County District Attorney’s Office.
Catanzarite in 2012 named Dr. Max Matos, a treating physician at the clinic, his vice president and medical director. Catanzarite and Matos are both listed as active qualified medical evaluators in the Division of Workers’ Compensation’s online database.
The Orange County criminal complaint alleges that Matos was identified as the majority owner, controlling 51% of the clinic.
“Despite Max Matos’ listed ownership interest, Jeffrey Catanzarite was the sole actual owner of Center for Better Health/Southland Spine, controlling its finances, and being responsible for making all substantive decisions,” according to the complaint.
The narrative in the complaint describes what’s commonly referred to as the MD-DC scheme, in which a physician is identified as the owner of a clinic that’s actually being run by a chiropractor, to evade a California law that prohibits chiropractors from owning more than 49% of a professional medical corporation. But Catanzarite and Matos are not facing charges for allegedly operating an illegal clinic.
The 38-count complaint alleges one count of conspiracy, one count of filing false and fraudulent claims, three kickback charges and 33 counts of insurance fraud.
Between January 2011 and October 2015, Catanzarite, Matos, Veronica Martin and Ronald Martin contracted to pay Grupo MedLegal LA, and later Medlegal Network Inc., $1,000 for each patient sent to the clinic for services that could be billed to workers’ compensation carriers, according to the complaint.
Catanzarite typically paid Grupo MedLegal LA and Medlegal Network Inc. $4,000 per week for four patient referrals, prosecutors allege. He also allegedly tracked referrals to ensure he was able to bill carriers for each patient.
“If Center for Better Health/Southland Spine could not provide services and bill insurers for a patient referred from Grupo MedLegal LA or Medlegal Network Inc., Center for Better Health/Southland Spine sought and obtained a replacement patient referral from Grupo Medlegal LA or Medlegal Network Inc.,” the complaint says.
Prosecutors allege Catanzarite paid $92,014 to Grupo MedLegal LA, and $1.32 million to Medlegal Network Inc., for unlawful patient referrals between January 2011 and October 2015.
Catanzarite allegedly had a similar arrangement to pay between $10,000 and $15,000 every 45 days to get patient referrals from Providence Scheduling Inc. Between 2011 and 2016, he reportedly paid the company $402,000 for referrals.
Grupo MedLegal LA and Medlegal Network Inc. are incorporated as separate companies in California but appear to operate together.
Grupo MedLegal LA was incorporated in May 2011, with Gershon Gabel identified as the chief executive officer, president, secretary and chief financial officer of the Santa Monica company. The California Secretary of State website notes the Franchise Tax Board has suspended the company for failure to meet certain tax requirements that aren’t detailed.
The company lists its address at 1158 26th St. in Santa Monica, which is the address for a company called Postal & More that offers services including post office boxes with what appear to be a real street address.
Medlegal Network Inc. was incorporated in 2008 and has an active status, according to the Secretary of State site. The company is located at the same address on 26th Street in Santa Monica as Grupo MedLegal LA, according to corporate filings. And Gabel is identified as president, CEO and CFO. Eilon Gabel is listed as the company’s secretary.
In addition to common names and addresses, Medlegal Network Inc. is identified as the “seller” of the Grupo MedLegal smartphone application in the iPhone App Store. Grupo MedLegal also has an app for Android devices that’s described as the best and most reliable “accident reporting mobile application” on the Google Play Store.
“We have won more than 1 million cases in the past 35 years that we have (been) operating in the United States,” the app description from the Google store reads. “We remind you that the consultation is free and we work on a no-win, no-fee basis.”
Providence Scheduling has been a recurring name in work comp fraud cases for five years and counting. A federal grand jury indicted the company in 2014, and it pleaded guilty to a single count of conspiracy to commit mail fraud in 2017. The company was fined $100,000.
Carlos Arguello and Fermin Iglesias, who were also indicted in 2014 and identified as controlling Providence, both pleaded guilty to federal conspiracy charges in 2016 and are awaiting sentencing.
Also in 2017, Orange County prosecutors charged 16 people, including Arguello and 10 applicants’ attorneys, with paying illegal referral fees to Providence Scheduling Inc. In 2018, the Orange County District Attorney’s Office accused four chiropractors of paying Providence for patients.
Prosecutors in Orange County also filed a five-count felony complaint against Iglesias in 2018 accusing him of conspiring with the four chiropractors in a scheme that cost carriers $3.4 million in payment on fraudulent bills.
The Riverside County District Attorney’s Office in May 2018 accused chiropractor Curtis W. Montgomery of paying illegal referral fees to Providence Scheduling as well.
The gist of the allegations involving Providence Scheduling is providers who paid for patient referrals were required to refer them for services provided by certain companies, including Medex Solutions and Prime Holdings. Arguello and Iglesias controlled Providence Scheduling, Medex and Prime, according to the federal indictment.
February 6, 2019
Cal/OSHA is reminding employers in California of the requirement to post their 2018 annual summaries of work-related injuries and illnesses. The summaries must be posted each year from February 1 through April 30.
February 6, 2019
Cal/OSHA is reminding employers in California of the requirement to post their 2018 annual summaries of work-related injuries and illnesses. The summaries must be posted each year from February 1 through April 30.
Instructions and form templates can be downloaded for free from Cal/OSHA’s Record Keeping Overview. The overview gives instructions on completing both the log (Form 300) and annual summary (Form 300A) of work-related injuries and illnesses. The annual summary must be placed in a visible and easily accessible area at each worksite. Current and former employees, as well as employee representatives, must be allowed to review the summary in its entirety.
The definitions and requirements for recordable work-related fatalities, injuries and illnesses are outlined in the California Code of Regulations, Title 8, sections 14300 through 14300.48. Employers are required to complete and post Form 300A even if no workplace injuries occurred.
Posting the summary may reveal patterns or potential hazards that need to be addressed and helps ensure workers are aware of work-related injuries and illnesses that occurred the previous year. More information on posting requirements or how to reduce workplace injuries and illnesses is available on the DIR’s Employer Information webpage.
The California Division of Occupational Safety and Health, or Cal/OSHA, is the division within the Department of Industrial Relations (DIR) that helps protect California’s workers from health and safety hazards on the job in almost every workplace. Cal/OSHA’s Consultation Services Branch provides free and voluntary assistance to employers to improve their safety and health programs. Employers should call (800) 963-9424 for assistance from Cal/OSHA Consultation Services.
Employees with work-related questions or complaints may contact DIR’s Call Center in English or Spanish at 844-LABOR-DIR (844-522-6734).
February 4, 2019
Janek Hunt, the brother-in-law of Dr. Munir Uwaydah, was arrested for workers’ compensation fraud and booked into custody on November 25th 2018 in Chicago, Cook County, Illinois.
February 4, 2019
Janek Hunt, the brother-in-law of Dr. Munir Uwaydah, was arrested for workers’ compensation fraud and booked into custody on November 25th 2018 in Chicago, Cook County, Illinois.
Nine counts were filed against him of insurance billing fraud under Penal Code Section 550 (a) (6) with an aggravated white collar crime enhancement on November 16th 2018 in the county of Riverside, California by the Riverside County District Attorney’s office. Janek Hunt is operating Blue Oak Medical Group with Dr. Uwaydah.
The fraudulent billings occurred out of the multiple Blue Oak clinics in San Bernardino, Riverside, San Diego, Orange, and Los Angeles counties. Janek Hunt is Estonian, lives in Estonia where he runs the Blue Oak Medical Group billing system, and travels to the United States which includes California, as needed.
The case against Janek Hunt came as a combined effort from workers’ compensation insurance payer investigators, including but not limited to: Gordon Oard, of Berkshire Hathaway; Noelani Mars, from Argus West; and Vic Beyer of ICW Group.
As Riverside County DA investigator, David Jones, concluded at the end of his report, Matthew Rifat, Shannon Devane (aka Shannon Moore), Janek Hunt, and Munir Uwaydah are engaged in a conspiracy to defraud ICW Group, Berkshire Hathaway, Zenith, Farmers, and other workers’ compensation insurance companies by billing for services and drugs not rendered. They also inflate the drug prices by having Blue Oak Medical Group buy drugs from a pharmaceutical company, like Talca Pharmaceuticals, in which Blue Oak has a financial interest.
By Michael Lents – September 18, 2017
“Education is the best way to fight against fraud” – read this important letter…
By Michael Lents – September 18, 2017
“Education is the best way to fight against fraud”
By Michael Lents – May 1, 2017
On April 20, 2017 Insurance commissioner Dave Jones and Orange County DA Tony Rackauckas announced a shut down on a $40 million workers’ compensation…
By Michael Lents – May 1, 2017
On April 20, 2017 Insurance commissioner Dave Jones and Orange County DA Tony Rackauckas announced a shut down on a $40 million workers’ compensation fraudulent medical billing and kickback operation. The charges are against 26 providers that involve around three key scams: a “snake oil” scam, a medication kickback scam and urine test scam. These scams stem from two poisonous trees which bore 24 poisonous fruits, if not more that may not have fully grown yet. As more on the case develops be sure CostFirst Corp. will be right there to identify and fight against these fraudulent fruits.
By Michael Lents – April 10, 2017
The recent enactment of AB 1244 and SB 1160 have identified individual(s) and providers that have been indicted or convicted. The problem many claim…
By Michael Lents – April 10, 2017
The recent enactment of AB 1244 and SB 1160 have identified individual(s) and providers that have been indicted or convicted. The problem many claims personnel face is identifying how many of these convicted and indicted individuals have affected their claims. Most are lacking in information to further identify the poisonous fruits of these poisoned trees.
If such information exists, is it scalable? Can you find the poisoned fruit? CostFirst can. Let us show you how!
By Dan Henley – October 31, 2016
AB 1244 and SB 1160 support anti-fraud efforts of Prosecutors, the Department of Insurance and District Attorneys but the Governor did not abolish fraud with a pen.
By Dan Henley – October 31, 2016
AB 1244 and SB 1160 support anti-fraud efforts of Prosecutors, the Department of Insurance and District Attorneys but the Governor did not abolish fraud with a pen.
Under AB 1244, the Administrative Director may suspend any provider if: proper licensure has been surrendered or revoked, the provider has been suspended by Medicare or Medi-Cal or when convicted of a crime involving the practice of medicine. And SB 1160 stays proceedings and accrual of interest upon the filing of criminal charges involving medical fraud. Assignment of receivables will be once again be restricted. A new Lien Affidavit required as of July 1, 2016 will create prerequisites to define legitimate lien disputes.
Liens have not stalled. A Compound Pharmacy that may meet these criteria filed over $1 million in new liens this year alone. While new regulations and court protocol are developed, lien volume and current WCAB procedures pressure payers for settlement or protracted litigation. The WCIRB estimates $12.2 million annual savings from these new anti-fraud statutes. We cannot rely on the AD or DWC alone. Providers change physical location, TIN, name, corporate structure or join different entities, yet continue business as usual. Tracking changes is daunting. Remember, you heard in here first.
Late model anti-fraud and abuse vehicles require a driver, a route and a destination. Fortunately, CostFirst has cleared the way to discern between liens to be negotiated or resisted. Our work in the past 11 years with employers, insurance carriers and law enforcement produced CUBETM powered by HEATTM, the high performance engine for the race against fraud and abuse. Arrange for a demonstration of innovative CUBETM powered by HEATTM a vital part of CostFirst’s deluxe brand and streamlined lien defense that aligns technology, provider analysis and expert bill review to determine reasonable charges for necessary treatment by qualified providers.
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