NHCAA Presents 2008 Fraud 'Investigation of the Year' Award to U.S. Departments of Defense & Justice, U.S. Postal Inspection Service, Wisconsin Physicians Service

Tuesday, November 18, 2008 General News
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Five Year Investigation Uncovered Largest Overseas TRICARE Fraud in History

Health Visions Corporation Handed 75-Count Indictment, Ordered to Pay Over $100,000,000

PHOENIX, Nov. 18 /PRNewswire-USNewswire/ -- The National Health Care Anti-Fraud Association (NHCAA) today is presenting the U.S. Departments of Defense and Justice, the U.S. Postal Inspection Service and the Wisconsin Physicians Service Program the 2008 Health Care Fraud "Investigation of the Year" Award for their five-year, complex, international investigation of fraudulent claims by the Health Visions Corporation who ultimately pleaded guilty and was ordered to pay over $100,000,000 and banned from future participation in TRICARE. The award is being presented Tuesday, November 18, 2008, at NHCAA's Annual Training Conference in Phoenix, Arizona, the association's premiere annual event, recognized industry-wide as the nation's leading health care anti-fraud forum.

"NHCAA would like to congratulate the U.S. Departments of Defense and Justice, the U.S. Postal Inspection Service and Wisconsin Physicians Service on the success of their multi-year, international investigation and resulting conviction," said NHCAA Executive Director Louis Saccoccio. "Not only did these organizations work together in close concert to achieve this important result, but they were able to engage Philippine government and law enforcement officials to support their effort - something that is often difficult in the best of circumstances."

The investigation began when the Department of Justice Defense Criminal Investigation Services (DCIS) and U.S. Attorney's Office investigators received complaints of apparent excessive billings while in the Philippines investigating other matters. The abnormal data was uncovered by TRICARE contractor Wisconsin Physicians Service Program Integrity staff who, through data mining, identified increased claims from the Republic of the Philippines through Health Visions Corporation, an entity that functioned as a health care provider, third-party biller and supplemental insurer. After reviewing the results, DCIS assembled a team comprised of investigators from several agencies and auditors from the Department of Defense, Office of Inspector General.

The extensive investigation and audit that followed determined that Health Visions Corporation President and CEO Thomas Lutz entered into a kickback agreement with a medical services provider in the Philippines that paid 50 percent of the claim amount submitted to TRICARE for patients referred by the Health Visions Corporation. In addition, the audit showed that the defendant consistently increased the dollar amount on claims from seven hospitals by over 200 percent before submitting them for payment and that, in fact, there was a specific formula used to inflate these claims. The investigation also determined that the defendants created a sham insurance program to circumvent TRICARE's requirement that beneficiaries pay a deductible and submitted fraudulent documents indicating that beneficiaries had been hospitalized and received services when they had not.

Ultimately, through coordination with the Philippine National Police, Lutz was arrested in Manila and removed to the United States. After pleading guilty, he was sentenced on June 17, 2008, to 5 years' imprisonment. Based on his guilty plea, the Health Visions Corporation was sentenced on April 24, 2008, to pay $99,680,302 in restitution, a $500,000 fine and to forfeit $910,000. The company was ordered to liquidate its assets to cover the costs, and all of its officers, directors and employees were permanently banned from TRICARE and other government programs.

Key participants:

Office of Assistant Secretary of Defense, Health Affairs, TRICARE Program Integrity Department of Defense, Office of Inspector General, Defense Criminal Investigative Service Department of Defense, Office of Inspector General, Audit, Military Health System Division Department of Justice, United States Attorney's Office, Western District of Wisconsin United States Postal Inspection Service Wisconsin Physicians Service, TRICARE Program Integrity

Founded in 1985 by several private health insurers and federal and state government officials, the National Health Care Anti-Fraud Association is the leading national organization focused exclusively on the fight against health care fraud. We are a private-public partnership -- our members comprise more than 100 private health insurers and those public-sector law enforcement and regulatory agencies having jurisdiction over health care fraud committed against both private payers and public programs. Established in 2000, The NHCAA Institute for Health Care Fraud Prevention is a separately incorporated, tax-exempt educational foundation that provides education and training to private- and public-sector health care anti-fraud personnel.

SOURCE National Health Care Anti-Fraud Association

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