Deeper Than the Headlines: Houston Doctor Convicted in 1.5 Million Dollar Scheme

Most healthcare fraud and abuse cases settle before ever going to trial. However, when they occasionally do go to trial, the outcomes can be as varied as the facts and circumstances of a specific case. A recent trial in Houston didn’t turn out so well for Dr. Ronald Kahn, a Houston physician.

On July 21, 2017, a federal jury convicted him for his involvement in approximately $1.5 million in fraudulent Medicare claims which involved medically unnecessary facet injections, home health services and kickbacks associated with referrals from a home health agency to perform facet injections.

Specifically, the jury convicted Kahn of one count of conspiracy to commit healthcare fraud and one count of conspiracy to pay and receive illegal kickbacks.

According to court records, Kahn falsely certified home health plans of care and then submitted claims to Medicare for services that weren’t medically necessary or were never performed.

Additionally, Kahn allegedly paid the home health agency for referrals and billed for medically unnecessary facet injections and injections that didn’t take place. It’s surprising to some that the amounts of such payments can be small but that the small payments have such large repercussions. In this case, the indictment shared several examples of payments.

Here is an example of one of them: “In furtherance of the conspiracy, and to accomplish its object and purpose, the conspirators committed and caused to be committed…the following overt acts: On or about November 11, 2008 defendant Ronald F. Kahn, M.D., paid and caused the payment of $168.17 to Charles Harris in exchange for Charles Harris referring Medicare beneficiaries to Defendant Ronald F. Kahn, M.D. to receive facet joint injections and other pain management procedures.”

The jury instructions in such cases can also be an interesting read for someone not familiar with them. The jury instructions in this trial are not that different from most of these healthcare fraud trials. Many times, compliance officers internally hear of clinicians “sticking their heads in the sand” as it relates to these fraud and abuse laws and regulations. With that possibly in mind, one phrase that is explained to a jury is the meaning of “deliberate ignorance.” In this case, the judge instructed as follows:

“Deliberate Ignorance”

“You may find that the defendant had knowledge of a fact if you find that the defendant deliberately closed his eyes to what would otherwise have been obvious to him. While knowledge on the part of the defendant cannot be established merely be demonstrating that the defendant was negligent, careless, or foolish, knowledge can be inferred if the defendant deliberately blinded himself to the existence of a fact.”

Oftentimes, the prosecution will then lay out how the provider turned a blind eye, because when they enrolled in Medicare they signed an application that clearly outlined the fraud and abuse laws as well as medical necessity requirements. Sentencing has been scheduled for September 25, 2017.

Effective compliance programs should be designed to prevent, detect, and correct missteps in these areas of healthcare fraud and abuse. Make sure your program is up-to-date on these kinds of issues.