Franey Medical Laboratories (FML) in Massachusetts and East Side Clinical Laboratory in Rhode Island have been charged by the state of Massachusetts with providing kickbacks involving both Medicaid and private insurance patients and for making a false Medicaid claim, according to CapeCodOnline. Kathleen Franey-Lopes, the vice president of FML (and also the daughter of the owner, Robert Franey), faces the same charges. Arraignment is scheduled for April 4.
Dr. Richard Ng, the director of a drug abuse clinic in Brighton, MA, allegedly provided the two labs with drug screening business. In return, the two labs paid the salaries of some of Ng’s office staff, reportedly including the daughter, nephew and boyfriend of Renee Andrews, Ng’s former office manager. Andrews has also been charged with multiple counts of Medicaid and private health insurance kickbacks and filing false Medicaid claims.
The state claims the labs netted $590,000 from the fraudulent scheme over a two year period.
Dr. Ng was charged with multiple counts of illegal prescribing, Medicaid false claims and Medicaid excess charges. The Boston Globe reported the following regarding this case:
According to Coakley’s [Massachusetts Attorney General Martha Coakley] office, Ng grew his practice until he was treating more patients than legally permitted and boosted his annual earnings to more than $575,000. To maintain the large practice, he allegedly knowingly prescribed Suboxone to nine of his patients who according to their urine drug screens were not taking the drug and continued to use illegal street drugs, including heroin, methadone, and other opiates.
Ng also allegedly wrote prescriptions for Suboxone, which is used to treat addiction, in false patient names and illegally charged MassHealth patients a $100 “new patient registration fee” that was paid by cash or check to him directly.
A total of 48 indictments were handed down by the grand jury in this case. There is no word yet on sentences the parties may face if the allegations are true.
There are a few things that occurred to me while reading about this case. One, the wheels of justice are turning slowly, as the alleged fraud took place in 2006-2008. Two, we are once again reading about illicit activity regarding urine drug screens. Three, there has been quite a bit of legal news coming out of Massachusetts regarding health care providers lately.
In just the last year, the state of Massachusetts was reported to be investigating Quest and LabCorp for possible Medicare fraud, settled with Calloway Labs for $20 million (again involving urine drug screen shenanigans), is dealing with the compounding pharmacy at the center of the fungal meningitis outbreak, is host to a federal grand jury investigating Millennium Laboratories, and settled with four pathology groups for $140,000 over allegations of improper medical record disposal.
And that’s just what’s been reported. Who knows how much more there is we don’t know about yet.