East Central Family Health Center: Alleged Behavioral Claims Through a Higher Rate

In the East Central Family Health Center fraud case, the center agreed to pay $825,000 to settle allegations that it billed Oklahoma Medicaid at higher federally qualified health center rates for behavioral health services furnished to other providers’ patients. The United States and Oklahoma alleged that East Central kept a share of each improperly billed encounter. If you worked with patient records, claims or payments, you may recognize the connection: whose patients generated the claims, whose rate Medicaid paid, and who kept the money.

Why the Federally Qualified Health Center Rate Mattered

East Central’s payment status made the alleged routing valuable. In its announcement, the Justice Department described East Central as a federally qualified health center in Wetumka, Oklahoma, certified to participate in the state’s Medicaid program. It received federal health grants and provided primary care to a medically underserved population, along with behavioral health and dental services.

For each office encounter, East Central received a flat payment under a prospective payment system. The announcement contrasted that payment with a fee for service determined by the condition being treated. It explained that the health center encounter rate was generally higher than the rate paid to non-FQHC providers.

That puts the billing organization’s identity at the center of the case. The government alleged that services which should have been billed as non-FQHC claims instead drew the center’s higher reimbursement. The alleged financial advantage lay in the payment category used for those patients’ care.

We see a pointed contradiction here: a center serving a medically underserved population allegedly used its payment status to collect a share of claims for patients who were not its own. Someone else’s patients. The center’s higher rate. Taxpayers allegedly paid the difference.

Patients of Other Providers, Claims Through East Central

The United States and Oklahoma alleged that East Central submitted, or caused others to submit, false Medicaid claims for behavioral health services from January 1, 2010, through April 30, 2012. Their account identified the Medicaid beneficiaries as patients of non-FQHC health care providers. They were not East Central patients, the government alleged.

For a billing employee, that allegation points to a specific mismatch: the provider shown in the patient records against the provider whose payment category appeared on the claim. We would look at that relationship alongside the service billed. The behavioral health service description alone would not explain why a claim drew the center’s encounter payment.

East Central’s Alleged Share of Each Encounter

The government alleged that East Central received a share of the rate for each improperly billed encounter, money to which it was not entitled. That retained share gives the allegation its business logic. On the government’s account, East Central benefited financially from having other providers’ patient claims pass through it.

To examine an arrangement like the one alleged here, we would want to understand who chose the billing route, how staff were told to use it, and how any retained share was recorded. Billing instructions could explain the decision. Payment records could show who benefited. Those are the connections we would assess with an insider.

The allegation also reached claims East Central caused to be submitted. For us, that puts attention on who set the billing arrangement as well as who processed the claims. An insider’s account of the instructions behind that arrangement could connect a decision inside the organization to the payments it received.

The Settlement and the Integrity Agreement

The U.S. Attorney’s Office for the Western District of Oklahoma and the Oklahoma Attorney General jointly announced the civil settlement on August 14, 2015. East Central agreed to resolve the federal and state allegations that it had violated the False Claims Act through false Medicaid billing.

The settlement also included a Corporate Integrity Agreement with the U.S. Department of Health and Human Services Office of Inspector General. According to the announcement, it required additional record-keeping, reporting and compliance measures.

The FBI, HHS Office of Inspector General, Oklahoma Attorney General’s Medicaid Fraud Control Unit and Oklahoma Healthcare Authority investigated the case.

When the Billing Provider Was Not the Provider Doing the Work

Acadia Healthcare faced a separate Medicaid case over clinics billing for laboratory work performed elsewhere. In its West Virginia settlement announcement, the Justice Department described allegations that seven outpatient drug treatment centers billed as though they had performed moderate or high complexity urine and blood tests. San Diego Reference Laboratory had performed the work instead, according to the government’s account.

Acadia operated the centers through CRC Health. The centers held certificates for waived tests only, the announcement said. The government alleged that their claims represented testing they had not themselves performed. Acadia’s $17 million settlement resolved those billing allegations. The announcement identified $8.5 million in underlying Medicaid payments.

The connection to East Central is the identity behind the bill. In East Central’s case, the government alleged that another provider’s patients generated claims under the health center’s higher payment category. In the Acadia case, the allegation concerned clinics claiming laboratory work done by an outside laboratory. For an insider, knowing where the work happened and which organization billed for it can explain a payment that looks routine on a claim. We follow that connection because a service description can leave the business arrangement out of view.

What an Insider Can Explain About the Billing

If you handled patient records, your knowledge may explain which provider was responsible for the people whose care appeared on the claims. If you handled billing, you may understand why claims followed a particular route. If you handled payments, you may understand the share the billing organization retained. We work with you to connect what you know to the transaction that drew government money.

How Much of a Settlement Does a Whistleblower Get?

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. If you recognize this kind of claims arrangement, we bring whistleblower expertise to the decisions that follow, from understanding the billing to finding whistleblower counsel who know the payment system.

You Know Whose Patients They Were

If you saw another provider’s patients billed through a health center for its higher encounter rate, speak to one of our Whistleblower Experts about how those claims were billed. We work alongside you to build your strongest Medicaid whistleblower case and bring in behavioral health whistleblower lawyers who understand provider billing and encounter reimbursement. Your knowledge of how the clinic actually operated is where that work begins, and we stay with you through the case.