A federal judge sentenced two physicians in the Novus Healthcare Services hospice fraud case to 23 years and prison and ordered them to pay more than $44 million in restitution. A nurse who was also part of the $40 million fraud case was sentenced to 33 months in federal prison.
The familiar scheme involved illegally admitting patients who were not appropriate for hospice while submitting false claims for services provided. Novus- a Frisco-based hospice provider, was one of the largest in the state before it closed in 2015. An increasing elderly population and an overburdened federal healthcare system make the industry vulnerable to fraud.
Estimates range that fraud accounts for somewhere between 3 to 10 percent of all healthcare spending. In 2020, the Centers for Medicare and Medicaid found that more than 6 percent, or upwards of $25 billion, were improper healthcare payments made by the federal government. In 2020, the Department of Justice prosecuted more healthcare fraud cases than ever. Of the 900 matters opened by the department, 580 were health fraud, most falling under the false claims act. The DOJ settled a record 256 False Claims Act studies in 2020, more than any other year.
Earlier this year, a jury found Novus Health Services Directors Dr. Mark Gibbs and Dr. Laila Hirjee and nurse Tammie Little guilty of conspiracy to commit healthcare fraud, among other charges. Gibbs received 13 years in prison and was ordered to pay $27,978,903 in restitution, while Hirjee got ten years in federal prison, will have to pay $16,253,281. Little will serve 33 months in federal prison.
According to evidence presented at trial, the defendants helped Novus CEO Bradley Harris defraud Medicare by, among other things, illegally admitting patients who were not appropriate for hospice and submitting materially false claims for hospice services.
Former Novus CEO Bradley J. Harris, who pleaded guilty to his role in the fraud in March, testified against his former employees. He said he worked with nurses to determine which patients would be admitted and discharged from hospice rather than rely on the expertise of licensed medical professionals. Gibbs and Hirjee would then certify that they had examined the patients in person when no appointment had occurred.
Other witnesses testified that Hirjee and Gibbs prescribed drugs like morphine, hydromorphone, and fentanyl by signing blank prescriptions and giving them to Harris and others at Novus to give to patients without physician oversight. “I was the doctor,” testified Director of Operations Melanie Murphey during the trial.
Even when Medicare was onto the scheme, Harris, Gibbs, and others didn’t give up. Medicare suspended payment to Novus over billing concerns, but leaders moved patients and employees to a new hospice company where they continued to fraudulently bill. Novus entities received $40 million from federal payers before the company was shut down.
“The defendants violated their Hippocratic Oath as doctors and instead focused on lining their pockets at the expense of patient safety. This case highlights the importance of thoroughly investigating any complaint of healthcare fraud,” said FBI Dallas Special Agent in Charge Matthew DeSarno via release.
Many of the codefendants pleaded guilty before the trial. From the release, they include.
Novus CEO Brad Harris, his wife, Novus Vice President of Patient Services Amy Harris, Novus Director of Operations Melanie Murphy, Novus Medical Director Charles Leach, Novus Medical Director Reziuddin Siddique (deceased), Novus Vice President of Marketing Samuel Anderson, Novus Director of Marketing Slade Brown, Novus RN Jessica Love, Novus triage RN Patricia Armstrong, Novus LVN Taryn Stewart, and Ali Rizvi, the owner of a separate physician home visit company – pleaded guilty to various offenses prior to trial. Love was sentenced 102 months, Stuart was sentenced to 96 months, Armstrong was sentenced to 84 months, Dr. Leach was sentenced to 57 months, and Anderson was sentenced to 33 months. The remaining defendants are facing statutory maximums of between two and 14 years in federal prison.