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Chicago Home to Highest Number of Home Health Agencies Fraudulently Billing Medicaid

Home health agencies have become a valuable resource in helping care for aging spouses, parents, and loved ones. With a surging number of elderly Americans, many of whom choose to live in their own homes as long as possible, the demand for in-home healthcare is booming. The Chicago Tribune reports that Cook County, which includes downtown Chicago and neighboring areas, has more home health agencies than in the entire state of New York. Cook County is also home to the highest number of Medicare fraud cases involving home health and physician staffing agencies.  A Chicago Tribune Watchdog Report reveals that the home health industry is a loosely regulated area of medicine that has become extremely lucrative for unethical agencies and physicians looking to illegally profit from taxpayer-funded Medicare.

According to the report, 96 people have been charged in the last 7 years with home health care fraud in Chicagoland. At least 24 of these cases were against physician staffing agencies and home health agencies.

Regardless of the number of charges filed, the majority of home health agencies committing fraud have flown under the radar for a variety of reasons, but mostly due to a combination of bigger than anticipated growth, coupled with lax regulations in Illinois that allow nearly anyone, without even so much as a background check, to apply for a home healthcare license for a fee of $25.

The Illinois Department of Public Health told the Tribune that there are 759 businesses with licenses to provide home health care in the state. However, physician staffing agencies are not classified as home health agencies and therefore are not required to abide by the same regulations. Since 2012, at least 10 physician staffing agencies in Chicago have been convicted of Medicare-related fraud. In fact, the Tribune notes that there are more cases of physician staffing agencies that have been convicted than in any other metro area in the country.

What is Medicare Fraud?
The Tribune report details several companies and individuals charged with Medicare fraud schemes related to home health agencies and physician staffing agencies. The companies were found to be raking in profits by conducting unnecessary tests, procedures, and therapies, giving unnecessary medications, and ‘upcoding’ procedures. Upcoding refers to the practice of submitting procedure codes to Medicare (or other insurance companies) for services that were more involved than what was actually performed.

Most of us look down on Medicare fraud, but many do not understand exactly how a scam could personally affect them. If someone has received services that an agency, hospital, doctor’s office or other medical entity has upcoded or made up entirely, it could prevent them from receiving those services in the future when they’re actually needed. The Tribune listed several instances in which the deceit of these companies has interfered with an elderly patient getting the care or services they need. In one example, a patient was unable to be sent to a rehabilitation hospital because his home health agency had been billing Medicare for services that indicated his condition was improving.

Several Chicago & Illinois Health Agencies Brought Down
One of the largest prosecuted cases involves a company called Mobile Doctors. The company’s CEO, Dike Ariji, contracted with 300 home health agencies to provide physicians for their Medicare patients, as well as to certify patients for the Medicare program. According to FBI records, one of the company’s physicians, Dr. Banio Koroma, billed 4,176 home visits to Medicare in 2012 alone. If true, Dr. Koroma would have visited 11 homes a day every single day of that year. As a result of his participation in the company’s scheme, he was sentenced to 40 months in federal prison. The Tribune notes that Dr. Koroma never became a U.S. citizen and is expected to be deported at the end of his sentence. His boss, Dike Ariji, was sentenced to 15 months in prison and ordered to pay $1.8 million in restitution.

In addition to exaggerating the number of patients their physician’s actually visited, Mobile Doctors was also found to have upcoded nearly all visits as a higher level of complexity than they were, as well as billing for longer visits than actually occurred. From 2007-2008, the FBI found that Medicare was billed for each patient using a higher reimbursing procedure code, and between 2007-2012, 93% of Mobile Doctors patients were billed at a higher rate. The company also classified able-bodied patients as being home bound and requiring home healthcare, which raked in money for referral fees paid by the home health agencies.

Another Chicago-area physician staffing agency had the same fate as Mobile Doctors. In 2016, Diana Jocelyn Gumila, a nurse who ran Schaumburg-based Doctor at Home, was sentenced to 6 years in federal prison and ordered to pay $15.6 million to the government. The agency flourished by upcoding procedures and services and operated under a business model that pursued doctors who were little more than sheep who would blindly follow orders. Evidence used against Gumila in court included incriminating emails and audio recordings in which she encouraged her physicians to ‘paint a picture’ of patient’s immobility, regardless of the truth.

The most tragic case covered by the Tribune’s report involves a family medicine physician who practiced in Belvidere, IL but routinely visited patients in Rockford. He was found to be fraudulently billing Medicare for these calls, was sentenced in April to 9 years in prison, and ordered to pay $2.7 million. One of his patients, Debra “Bird” Lingelbach was a 48 year old mother and grandmother when Dr. Charles Dehaan began calling on her. She had severe chest pains and for nearly 3 years, Dr. Dehaan told her she was fine. It was only after he was arrested for Medicare fraud that she decided it would be wise to seek a second opinion. Her diagnosis was stage IV lung cancer and she was gone within months. Dehaan is also facing charges in circuit courts over sexual assaulting patients in both Winnebago County and Cook County.

An End To Medicare Fraud Won’t Happen Anytime Soon
Despite Chicago’s record number of cases of Medicare fraud by home health and physician staffing agencies, regulation is still severely lacking and little change seems to be on the horizon. In the past, staffing agency MDs mostly certified patients for Medicare. With these home health agencies now contracting with them to provide other services, the landscape of healthcare has evolved. The regulations, however, have not. Physician staffing agencies operate outside of traditional home health agency guidelines and are able to bypass inspections. It also used to be that home health agencies were contacted by the family member or loved one of someone who legitimately needed home health care. The Tribune reports that agencies are now sending people out targeting and recruiting the elderly for home health services.

In 2016, the Federal government required Illinois agencies to stop pre-billing Medicare for future services. Traditionally, home health agencies are permitted to bill in advance for anticipated services, but then square up on the back end. Many agencies were using this ‘honor system’ to take advantage, knowing that it would be years, if ever, by the time any fraud was discovered. Former Health & Human Services Secretary, Dr. Tom Price, did away with the prohibition on pre-billing this past March. It still has not been reinstated and it appears unlikely that it will.

Until physician staffing agencies are under home health agency jurisdiction and until the bar is higher for home health agencies to form, obtain a license, and bill Medicare, the problem is likely to only get worse. For now, the only deterrent to fraud is the knowledge that the Feds are cracking down and judges are handing down long prison sentences and ordering hefty fines as punishment.