This spring, St. Louis chiropractor Dr. Donald Havey and his billing CA, Susan Reno, were brought up on serious healthcare fraud charges. Dr. Donald Havey was sentenced to 51 months in prison and ordered to pay restitution of $2,276,221 on charges involving a scheme to bill Medicare for expensive custom ankle-foot orthotics that were never actually provided to the patients. His billing CA, Susan Reno, was sentenced to five years of probation and ordered to pay restitution of $10,571.
Dr. Havey sold custom orthotic devices through several of his own DME companies. Reno and her company, Pinnacle Billings and Collections, provided billing services for him.
As far back as 2009 and continuing to 2014, Dr. Havey defrauded Medicare, Medicaid, other public and private health insurance companies, and patients by submitting false reimbursement claims for custom orthotic boots. The boots, it turned out, didn’t actually contain the custom features described in the reimbursement claims.
The irony is, it was a good idea and good marketing. Dr. Havey employed other chiropractors to market his “Fall Prevention Program” to nursing homes and to sell the orthotic boots in Missouri and other states, including Texas, Alabama, California, Georgia, Illinois, Kentucky, Massachusetts, Mississippi, Oklahoma, Rhode Island and Tennessee. Dr Havey and his subcontracted DCs told the nursing homes that the program would reduce falls by almost 20% and would improve the patients’ quality of life.
It sounds good and like a valuable service, right? But, sadly, the program wasn’t motivated by a genuine desire to reduce falls, but by greed: the sole intent of the program was to sell huge numbers of orthotic boots to nursing home patients. Dr. Havey also apparently told the nursing homes that there would be little or no cost to the patients, when all the while, he knew that a Medicare patient could be charged as much as $500 if they didn’t have supplemental insurance.
Now, there’s no way Medicare wouldn’t have closely scrutinized any company that submitted claims for a massive number of very expensive orthotic boots. So Dr. Havey cooked up a scheme to conceal the number of orthotic boots that he and his companies were selling by colluding with Reno to submit false claims under several of his companies.
In one example, a chiropractor assessed and ordered orthotics for five Medicare patients residing in the same facility on the same day. Dr. Havey and Susan Reno submitted two of the residents’ claims to Medicare using one of his companies, Advanced Custom Orthotics, as the supplier and the other three were billed to Medicare using another of his companies, Senior Care Orthotics, as the supplier.
Medicare paid Dr. Havey between $2,400 and $2,600 for each pair of orthotics boots. It’s a lot, but the grand total was even higher. The total loss to Medicare, Medicaid, and the private insurance companies was over $2.2 million.
Both Dr. Havey and Susan Reno pled guilty and were sentenced. This speaks to a question we sometimes receive from chiropractic assistants: if the doctor gets in trouble, will I get in trouble, too? The answer is yes, absolutely, if you knowingly participated in healthcare fraud. In other words, if your doctor is doing something that makes you uncomfortable or appears shady, get your concerns documented in writing, so that you can prove, if necessary, that you had no specific intent to defraud. Owning a separate DME company is allowed, and may be a good business move for you. Just be prepared to lead with integrity and do it right.
In today’s atmosphere of intense scrutiny of DME companies, chiropractors, and their documentation, it’s no longer a question of if you’ll be audited, but when. Don’t be caught flat-footed. Even and especially if you have no intent to defraud, you still need to clean up your documentation now. Self-audits are not only recommended, they’re indispensable. Trust me: you want to find any regularities and deficits in your documentation before an auditor—or, heaven forbid, a federal investigator—does.
This article was by Kathy Mills Chang. The author’s opinions are their own and DC Aligned does not take responsibility for content statements and opinions. You should seek expert counsel in evaluating opinions, treatments, products and services. For more info see our Editorial Policies.