Dermatology Associates of Central New York: Absent Supervision and Medicaid Credentials

In the Dermatology Associates Central New York settlement, the practice agreed to pay $811,197 to resolve allegations that it billed non-physician practitioners’ work under physician names at higher rates than appropriate. The practice admitted causing physician-name claims while its doctors were traveling outside New York, and acknowledged billing uncredentialed Medicaid providers’ work in a physician’s name.

The Justice Department announced the settlement on December 4, 2018. Dermatology Associates of Central New York, PLLC was based in Fayetteville and owned and operated by a married couple, both medical doctors. The practice employed physician assistants and nurse practitioners who treated Medicare, Medicaid and TRICARE patients. A whistleblower’s qui tam lawsuit under the federal and New York False Claims Acts triggered the investigation.

The Practice Was Open, the Physicians Were Away

From March 2009 through February 2015, Dermatology Associates generally operated six days a week, but a physician was physically present in the office suite on a more limited basis. The government said the practice caused its billing company to submit thousands of claims identifying a physician owner as the rendering or supervising provider on days when no physician was there, while non-physician practitioners did the work.

The practice admitted that it caused those physician-name claims on more than 200 days when the doctors were traveling outside New York. We see the absurdity in what taxpayers were buying: the physician’s name kept doing work on the bill while the physician was elsewhere.

A similar allegation appeared in Complete Physician Services, where the government alleged that physician-assistant services were billed as physician-supervised services while the physician was abroad. That separate case shows why travel can matter to a billing inquiry: the location of the physician can contradict the supervision represented to the payer.

What Constitutes Fraud When Billing ‘Incident To’?

In this case, the incident-to billing problem was a claim that represented physician supervision when no physician was in the office. The Justice Department explained that Medicare and TRICARE permitted certain services performed by non-physician practitioners to be billed in a physician’s name when the required conditions were met. Direct supervision was one of those conditions.

In those years, a physician had to be in the office suite and ready to step in throughout the procedure. Medicare and TRICARE reimbursed certain services by non-physician practitioners without that direct supervision at a lower rate. That payment difference gave the physician’s name financial value on the claim.

The alleged overbilling therefore turned on who performed or supervised the service, with government money attached to that representation. For an insider, the revealing comparison is between the practitioner who treated the patient, the physician available that day and the provider identified to the payer.

Medicaid Required the Actual Practitioner’s Credentials

New York Medicaid presented a separate problem. As the Justice Department explained for this case, the program did not allow incident-to billing and required a non-physician practitioner to be enrolled as a Medicaid provider with the New York State Department of Health to receive reimbursement for services to Medicaid patients.

Dermatology Associates acknowledged that some practitioners treating Medicaid patients during the period lacked the required New York credentials. Their services were billed in a physician’s name. The issue reached beyond whether a doctor was available to supervise: it concerned the Medicaid status of the person who actually furnished the care.

That distinction gives someone handling enrollment or credentialing a different view from someone managing the physicians’ schedules. One may know which practitioners could bill Medicaid; the other may know when a physician was physically available. The claims bring those separate parts of the practice together, and the same physician name can conceal different problems for different payers.

The Billing Company Sent the Practice’s Claims

The government’s account placed the practice’s billing company between the work in the office and the claim submitted to the health care program. Dermatology Associates admitted causing that company to submit the physician-name claims during the doctors’ out-of-state travel. The practice’s decisions about provider identity are part of the case even though another business transmitted the bills.

That is why we connect the submitted claim with the treatment and supervision records. The person treating the patient, the person supervising the work and the person named on the bill are separate facts. An insider who understands how that name reached the billing company may explain something the claim itself cannot: where the clinical account of the visit became a billing instruction.

What the Records Need From Someone Who Was There

A 2017 Journal of AHIMA article, Busting Bad Medicine: A Call to Action Addressing Healthcare, Fraud, Waste, and Abuse, describes comparing the treatment date, type of treatment and nurse or physician signature in the patient’s record. Its next point explains why someone inside the practice can matter as much as the paperwork:

In an absent-supervision case, the schedule shows when the physician was expected, while a witness may explain who was actually available and how the office operated. We connect that knowledge to the claims and government payments it helps explain.

A Whistleblower Started the Investigation

The whistleblower’s lawsuit brought this billing pattern to the government’s attention. The settlement resolved allegations under both the federal and New York False Claims Acts. The announcement also said the whistleblower would receive a share of the settlement proceeds.

The Defense Criminal Investigative Service and the Health and Human Services Office of Inspector General took part in the coordinated investigation. TRICARE, the Defense Department’s healthcare system for military members, retirees and their dependents, was among the programs receiving the claims.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. For someone with direct knowledge of the billing decisions, the opportunity begins with explaining how the provider on the claim diverged from the work in the office. Our whistleblower experts work beside you to build the case for a whistleblower recovery.

You Know Who Was in the Office

If you know the practitioners, the physicians’ travel or the instructions behind physician-name claims, talk with our whistleblower experts about what happened in your practice. We work beside you to build the case around the care, credentials and billing decisions you understand, and bring in physician-practice fraud whistleblower lawyers who know supervision and provider-enrollment disputes. You bring the view from inside the office; we bring the judgment and partnership to pursue it with you.