$3.5 Million to Settle Allegations of Uniformed Service Member Overbilling

Radiation oncology providers in Pensacola, Florida, will pay $3.5 million to the U.S. government and the state of Florida to resolve allegations that they billed Medicare, Medicaid, and TRICARE – the health care program for uniformed service members, retirees and their families worldwide – for radiation oncology services that were not eligible for payment. The defendants include Gulf Region Radiation Oncology Centers Inc. (GRROC), Gulf Region Radiation Oncology MSO LLC, Sacred Heart Health System Inc., West Florida Medical Center Clinic P.A., Emerald Coast Radiation Oncology Center LLC (ECROC), and two individual radiation oncology doctors.


The government alleged that between 2007 and 2011, the defendants regularly billed for radiation oncology services that were not supervised by a physician, as required by Medicare, Medicaid, and TRICARE, and that, in fact, these services were often performed while the defendant doctors were on vacation or were working at another radiation oncology clinic. The government also alleged that the defendants billed for other treatment services even when patients’ medical records provided no evidence that the services were rendered. The defendants also allegedly billed twice for the same services and misrepresented the level of a service provided to increase their reimbursement from the federal health care programs.


Since December 2007, Sacred Heart Health System Inc. and West Florida Medical Center Clinic P.A. have been the sole shareholders of Gulf Region Radiation Oncology MSO LLC and GRROC. GRROC provides radiation oncology services at two locations in Pensacola, Fla. Sacred Heart was also a shareholder in ECROC, a radiation oncology center located in Destin, Florida, approximately 60 miles from Pensacola. Beginning in December 2007, the two radiation oncologists began providing physician services at the GRROC clinics, and in June 2008, they began providing services at ECROC.


The allegations resolved by the settlement were first raised in a lawsuit filed against the defendants under the qui tam, or whistleblower, provisions of the False Claims Act. The act allows private citizens with knowledge of fraud to bring civil actions on behalf of the government and to share in any recovery. As part of the settlement, the whistleblower, who previously worked at GRROC, will receive approximately $609,796 from the federal share of the settlement amount.


In addition to the $3.5 million payment, defendants GRROC and the physicians entered into Integrity Agreements with the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG) intended to deter wrongful conduct in the future. The agreements require enhanced accountability and monitoring activities to be conducted by both internal and independent external reviewers.


The case is captioned United States ex rel. Koch v. Gulf Region Radiation Oncology Centers Inc., et al., No. 3:12-cv-00504 (N.D. Fla.). The claims settled by this agreement are allegations only, and there has been no determination of liability.


See the DOJ Announcement


See also Medical Law Perspectives, June 2012 Report: Too Much, Too Little, Too Late: Injuries from Delays and Failures to Perform CT Scans or Overexposure to Radiation