DOJ Targets Medicare Fraud Involving Ambulance and Ambulette Transportation Services

The U.S. Department of Justice (DOJ) has recently pursued multiple cases involving allegations of Medicare fraud against the owners of ambulance and ambulette companies. The U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) has pursued similar cases in recent years as well.

As a result, it appears that these companies may be under the microscope. When we see multiple enforcement actions targeting similar types of healthcare entities (or their owners), this is typically a sign of an ongoing enforcement priority at the DOJ or HHS-OIG. With this in mind, owners of ambulance and ambulette companies should be aware of what is going on, and they should take steps to mitigate their risk of facing scrutiny.

DOJ Targets Ambulette Company Owners in New York for Paying Illegal Healthcare Kickbacks and Defrauding Medicare

Last year, the DOJ announced charges against eight individuals accused of using their ambulette company in New York to fraudulently bill Medicare for more than $16 million. As alleged in the DOJ’s indictment, the defendants paid kickbacks to Medicare beneficiaries who the defendants either transported to non-existent healthcare appointments or artificially inflated the cost of their transportation by driving beneficiaries to addiction treatment centers in New York City when they lived on Long Island.

The DOJ also alleges that, “[a]t least two claims were submitted to Medicaid for individuals who were deceased, and some claims were submitted for individuals who were hospitalized or incarcerated,” raising serious concerns of Medicaid fraud.

Based on these allegations, the ambulette company owners are facing charges for conspiracy to commit health care fraud, conspiracy to defraud the United States, health care fraud, paying health care kickbacks, and money laundering. If convicted, they could face millions of dollars in fines and recoupment liability along with decades of federal imprisonment.

DOJ Targets Ambulance Company in Illinois that Billed for Unnecessary and Non-Emergency Transportation

A few years ago, the DOJ entered into a civil settlement with an ambulance company in Illinois to resolve allegations that the company had illegally billed Medicare for “scheduled, non-emergency ambulance transportation.” In that case, the DOJ alleged that the ambulance company, “routinely billed Medicare for non-emergency ambulance transports to regularly scheduled dialysis treatments when the services did not meet Medicare requirements.” The DOJ also alleged that the company’s ambulance services failed to meet the standard of medical necessity, “particularly when the patients safely rode in other forms of transportation – such as personal vehicles, medical transport cars, and wheelchair vans – to medical appointments and social outings.”

DOJ Targets Ambulance and Ambulette Company Owner in Texas Who Billed $3 Million in False Medicare Claims

In another case, a United States Attorney’s Office charged the owner of an ambulance and ambulette company with submitting more than $3 million in improper claims for Medicare reimbursement. According to the DOJ, the owner admitted to “submit[ing] . . . ambulance claims for Medicare beneficiaries transported by vans, not ambulances, to routine psychotherapy appointments and for at least one other beneficiary who did not require ambulance transportation.” The owner also admitted to instructing EMTs to create fake ambulance transport records and to creating fake ambulance transport records for an EMT who never worked for the company. After pleading guilty to conspiring to commit healthcare fraud, the owners faced up to a $250,000 fine and 10 years in prison.

DOJ Targets Ambulance Company Owners and General Manager in California for Medicare Fraud

In yet another case, the DOJ filed multiple charges against the owners and general manager of an ambulance company in California who were accused of, “bill[ing] Medicare for ambulance transportation services for individuals that [they] knew did not need to be transported by ambulance.” The general manager was also accused of making false statements to federal agents during the federal government’s claims investigation. In total, the DOJ alleged that the company submitted claims totaling more than $5.5 million to Medicare and received more than $1.3 million in fraudulent Medicare reimbursements. Several of the defendants pled guilty in the case, and they received federal prison sentences ranging from two-and-a-half to nine years.

What Can (and Should) Ambulance and Ambulette Company Owners Do to Protect Themselves?

With an enforcement track record spanning more than a decade, and with tens of billions lost to Medicare fraud annually, it is clear that violations of the False Claims Act involving health care providers such as ambulance and ambulette service providers are an ongoing priority for the DOJ (and HHS-OIG). In light of this, owners of ambulance and ambulette companies need to prioritize compliance. With civil and criminal penalties both being on the table, company owners need to ensure that they do everything they can to protect both their companies and themselves.

So, what does this entail?

Like all healthcare entities, ambulance and ambulette companies face a host of compliance obligations under the Medicare and Medicaid programs. Effectively managing Medicare billing compliance requires a committed, systematic approach that starts with a top-down commitment doing what is required. Ambulance and ambulette companies must also be careful to avoid practices (both intentional and unintentional) that are likely to trigger scrutiny from the DOJ or HHS-OIG. Based on the cases discussed above, these include practices such as:

• Paying kickbacks to Medicare beneficiaries who request ambulance or ambulette transportation 
• Transporting Medicare patients to healthcare facilities that are farther away than necessary 
• Transporting Medicare patients when ambulance or ambulette services are unnecessary 
• Providing ambulance or ambulette transportation services to appointments that are not medically necessary 
• Creating false transport records or altering transport records in order to justify Medicare billings 

Even these are just examples. Numerous other acts and omissions can expose ambulance and ambulette companies’ Medicare billings to scrutiny—and this scrutiny can expose company owners (and other individuals) to substantial penalties. With this in mind, to effectively mitigate their risk, ambulance and ambulette company owners should take steps including:

1. Conduct a Risk Assessment Focused on the Company’s Past and Present Business Practices

When conducting investigations into suspected Medicare billing fraud, the DOJ and HHS-OIG can examine several years’ worth of ambulance and ambulette companies’ program billings. With this in mind, these companies should conduct risk assessments focused on their past and present business practices. Even if a company is currently in compliance, a Medicare audit or whistleblower complaint could lead to scrutiny of its Medicare billings from a different era.

These risk assessments must be comprehensive, and they must be unbiased and uncompromised. They must also be conducted under the protection of the attorney-client privilege. With a team that includes career healthcare compliance and defense lawyers as well as former DOJ prosecutors and HHS-OIG investigators, we have the capabilities required to help our clients conduct these risk assessments effectively.

2. Re-Evaluate the Company’s Medicare Billing Compliance Policies and Procedures

Along with assessing the company’s past and present business practices, it will also be important to re-evaluate the company’s Medicare billing compliance policies and procedures. If these have become outdated, or if they were not custom-drafted with a good-faith commitment to compliance in mind, they may not be serving their intended purpose.

The DOJ and HHS-OIG expect ambulance and ambulette companies to have up-to-date and effective compliance programs in place. If a company’s policies and procedures are not in line with industry standards, this alone can raise red flags that will lead to intensive and high-risk scrutiny.

3. Update the Company’s Compliance Policies, Procedures, and Protocols as Necessary

If this re-evaluation of the company’s compliance program reveals any deficiencies, remedying these deficiencies should be a priority. Continuing to improperly bill for Medicare payments can expose ambulance and ambulette companies to even greater penalties. It can also increase the owners’ risk of facing criminal charges for intentional Medicare fraud.

4. Address Any Outstanding Medicare Fraud Risks Related to Ambulance or Ambulette Services

Along with remedying any compliance program deficiencies, companies should also address any outstanding Medicare fraud risks, including the submission of fraudulent claims, related to their ambulance or ambulette services. In particular, if they have improperly billed Medicare in the past, they should work with their counsel to develop a strategy to proactively come into compliance without triggering a federal investigation.

5. Monitor and Enforce Ambulance and Ambulette Transportation Services-Related Medicare Compliance Going Forward

Once ambulance and ambulette companies have Medicare billing compliance programs in place, they need to internally monitor and enforce compliance on an ongoing basis. With the DOJ and HHS-OIG both prioritizing enforcement in this area, companies cannot afford to overlook or ignore billings that prosecutors may classify as “fraudulent” under the False Claims Act or federal healthcare fraud statute.

Billing federal health care programs, including Medicare, for private ambulance and ambulette transportation services is a high-risk area that demands a proactive and good-faith commitment to compliance. At Oberheiden P.C., we help ambulance and ambulette companies effectively manage Medicare billing compliance, and we represent them in fraud investigations involving the Medicare program when necessary.

Schedule a Call with a Medicare Compliance and Defense Lawyer at Oberheiden P.C.

If you would like more information about our Medicare compliance or Medicare fraud defense services for private ambulance and ambulette transportation providers, we invite you to get in touch. To schedule a call with one of our senior attorneys as soon as possible, call us at 888-680-1745 or tell us how we can get in touch online today.