HIPAA Journal is the leading provider of news, updates, and independent advice for HIPAA compliance

Hospice CEO Pleads Guilty to Falsifying Healthcare Claims and Inappropriate Medical Record Access

The former CEO of Novus and Optimum Health Services, which operates two hospices in Texas, has pleaded guilty in a fraud case that saw Medicare and Medicaid defrauded out of tens of millions of dollars through the submission of falsified health care claims.

Prerak Shah, Acting U.S. Attorney for the Northern District of Texas, recently announced that Bradley Harris, 39, pleaded guilty to conspiracy to commit healthcare fraud and healthcare fraud and is now awaiting sentencing.

In addition to defrauding federal healthcare programs out of tens of millions of dollars, the actions of Harris resulted in vulnerable patients being denied the medical oversight they deserved, saw prescriptions for pain medication written without physician input for his financial benefit, and allowed terminally ill patients to go unexamined.

Harris admitted billing Medicare and Medicaid for hospice services between 2012 and 2016 that were not provided, not directed by medical professional, or were provided to individuals who were not eligible for hospice services. Harris also admitted to using blank, pre-signed prescriptions for controlled substances and providing the drugs without any involvement from physicians.

Get The Checklist

Free and Immediate Download
HIPAA Compliance Checklist

Delivered via email so verify your email address is correct.

Your Privacy Respected

HIPAA Journal Privacy Policy

Two coconspirators – Dr. Mark Gibbs and Dr. Laila Hirjee – were paid $150 for each false order they signed and would regularly certify that hospice patients had terminal illnesses with a life expectancy of 6 months or less, without having conducted any examinations. Dr. Gibbs, Dr. Hirjee, and a third physician, Dr. Charles Leach, provided blank prescriptions for controlled substances which allowed Harris to prescribe schedule II-controlled substances to Medicare and Medicaid beneficiaries in the hospice without guidance from a medical professional.

Harris also violated the Health Insurance Portability and Accountability Act (HIPAA) Rules when he accessed the medical records of patients to identify individuals who could be contacted and offered Novus hospice services. In the summer of 2014, Harris negotiated an agreement with Express Medical which allowed him to access the medical records of potential patients in return for using the company for lab services and home health visits. Previous patients of Express Medical were then contacted by Harris’s wife and other hospice staff to recruit them, regardless of whether they were actually eligible for hospice services. This allowed Harris to recruit new hospice patients to avoid exceeding Medicare’s aggregate hospice cap.

The HHS’ Centers for Medicare and Medicaid Services received multiple reports of potential fraud and suspended Novus; however, Harris then transferred patients from Novus to a new hospice company, which then transferred reimbursements for hospice services back to Novus. Dr. Gibbs was registered as the medical director of the new hospice company.

Harris is scheduled to be sentenced on August 3, 2021 and faces up to 14 years in jail. The trial of Dr. Gibbs, Dr. Hirjee and two other coconspirators is scheduled for April 5, 2021. 10 codefendants have already pleaded guilty and are awaiting sentencing for their roles in the scam. Dr. Charles Leach previously pleaded guilty to one count of conspiracy to commit healthcare fraud in 2018, for his role in the $60 million fraud case. According to court documents, the blank prescriptions Dr. Leach signed were used to obtain controlled substances, high doses of which were then administered to patients by nurses to hasten their deaths.

“The Justice Department cannot allow unscrupulous business people to interfere with the practice of medicine. We are determined to root out healthcare fraud,” said Acting U.S. Attorney Prerak Shah. “We will continue to work tirelessly with our state and federal partners to hold those who commit health care fraud accountable and seek justice for patients that are harmed in furtherance of fraud schemes,” said FBI Dallas Special Agent in Charge Matthew DeSarno.

Author: Steve Alder is the editor-in-chief of HIPAA Journal. Steve is responsible for editorial policy regarding the topics covered on HIPAA Journal. He is a specialist on healthcare industry legal and regulatory affairs, and has several years of experience writing about HIPAA and other related legal topics. Steve has developed a deep understanding of regulatory issues surrounding the use of information technology in the healthcare industry and has written hundreds of articles on HIPAA-related topics.