The United States Attorney for the Western District of Michigan announced on November 18, 2024 two criminal convictions and three civil settlements against a second wave of doctors who participated in nationwide telemedicine fraud schemes by ordering medically unnecessary orthotic braces and genetic testing, allegedly wasting Medicare dollars to line their own pockets. These resolutions were achieved through Operation “Happy Clickers,” a joint initiative between the U.S. Attorney’s Office, the U.S. Department of Health & Human Services’ Office of the Inspector General (HHS-OIG), and the Federal Bureau of Investigation (FBI).
Theresa Kordish, D.O., of Kalamazoo, MI, and Utibe Effiong, M.D., formerly of Mt. Pleasant, MI, each pleaded guilty to one count of making a false statement relating to health care matters. Both doctors admitted using a telemedicine program to authorize medical orders for patients they never met or examined, approving most orders in mere seconds. In addition to their criminal convictions, each doctor also agreed to pay civil settlements for their conduct based on the scope of the fraudulent orders each signed and on ability-to-pay considerations. Dr. Kordish agreed to pay $50,000, and Dr. Effiong agreed to pay $150,000. Dr. Kordish is scheduled to be sentenced on February 10, 2025. Dr. Effiong is scheduled to be sentenced on February 18, 2025.
The United States also reached civil settlements with three other physicians. Derek Grossman, D.O., of Traverse City, MI, agreed to pay $295,192.93 to resolve allegations that he used a telemedicine program to order over 1,300 medically unnecessary orthotic braces. Pedro Toweh, M.D., of Battle Creek, MI, agreed to pay $85,822 to resolve allegations that he likewise ordered over 800 medically unnecessary braces. Aaron Willen, D.O., formerly of Kalamazoo, MI, agreed to pay $80,000 to resolve similar allegations regarding several hundred orthotics claims based on ability to pay.
These actions follow nationwide takedowns of so-called “marketers” and owners of medical supply companies and genetic testing laboratories, who worked together to conduct large-scale schemes to defraud Medicare. The marketers placed phone calls to Medicare beneficiaries, often through overseas call centers, to obtain enough information that they could fill out fraudulent medical orders for orthotic braces and genetic testing. The marketers then paid doctors to approve these orders through telemedicine programs for patients they never met in violation of federal healthcare laws. The marketers then sold the signed orders to medical supply companies and laboratories in violation of federal anti-kickback laws.
Federal investigators initiated these investigations based on a detailed review of Medicare data relating to these expensive braces and genetic tests, which sometimes exceed $8,000 per test. Including the criminal pleas and civil settlements, prosecutors handling Operation “Happy Clickers” have resolved cases against a total of nine separate doctors and nurse practitioners who were responsible for ordering over $10.5 million in alleged loss to the Medicare Program.
Through both rounds of enforcement actions, the United States has recovered over $1,000,000 for the Medicare Program in civil settlements, in addition to restitution that has and is expected to be ordered in the criminal cases. Almost all of these civil settlements were reached based on the inability of the defendants to pay higher amounts.
If you have information regarding false claims having been submitted to Medicare, Medicaid, TRICARE, other federal health care programs, or to other federal agencies/programs, and the information is not publicly known and no actions have been taken by the government with regard to recovering the false claims, you should promptly consult with a False Claims Act attorney (also known as qui tam attorneys) in your U.S. state who may investigate the basis of your False Claims Act allegations and who may also assist you in bringing a qui tam lawsuit on behalf of the United States, if appropriate, for which you may be entitled to receive a portion of the recovery received by the U.S. government.
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