Political Ties of Top Billers for Medicare
By FRANCES ROBLES and ERIC LIPTONApril 10, 2014 10:03 AM
Correction Appended
MIAMI — Two Florida doctors who received the nation’s highest Medicare reimbursements in 2012 are both major contributors to Democratic Party causes, and they have turned to the political system in recent years to defend themselves against suspicions that they may have submitted fraudulent or excessive charges to the federal government.
The pattern of large Medicare payments and six-figure political donations shows up among several of the doctors whose payment records were released for the first time this week by the Department of Health and Human Services. For years, the department refused to make the data public, and finally did so only after being sued by The Wall Street Journal.
Topping the list is Dr. Salomon E. Melgen, 59, an ophthalmologist from North Palm Beach, Fla., who received $21 million in Medicare reimbursements in 2012 alone. The doctor billed a bulk of his reimbursements for Lucentis, a medication used to treat macular degeneration made by a company that pays generous rebates to its doctors.
Dr. Melgen’s firm donated more than $700,000 to Majority PAC, a super PAC run by former aides to the Senate majority leader, Harry Reid, Democrat of Nevada. The super PAC then spent $600,000 to help re-elect Senator Robert Menendez, Democrat of New Jersey, who is a close friend of Dr. Melgen’s. Last year, Mr. Menendez himself became a target of investigation after the senator intervened on behalf of Dr. Melgen with federal officials and took flights on his private jet.
Another physician, Dr. Asad Qamar, an interventional cardiologist in Ocala, Fla., has sent at least $250,000 in donations over the last decade to the political campaigns of President Obama and other prominent Democrats; he has become the target of scrutiny related to cardiovascular treatment centers he runs in Central Florida.
Dr. Qamar was paid more than $18 million in 2012, making him and Dr. Melgen by far the largest payment recipients nationwide, according to the data. A pathologist from New Jersey received the third largest Medicare reimbursement, $12.6 million.
In an interview on Wednesday, Dr. Qamar said any questions about his Medicare bills were unjustified.
“Just looking at the sheer volume of work and billings from a single physician is not a sign of wrongdoing,” Dr. Qamar said, noting that his practice handles cardiac procedures in its outpatient clinics that would be done inside a hospital in many other states, which he said explained the large billable amounts.
The state of Florida was home to many of the physicians who received the largest payments, 28 out of the top 100. California, with a much larger population, was second, with 10 of the top 100.
Doctors in Florida have been frequent targets of Medicare fraud investigations, based on irregular patterns of bills or extremely high bills.
Just last month, two Florida medical clinic owners were sentenced on charges of Medicare fraud, both in cases involving more than $20 million in fraudulent payments. In addition, the Halifax Hospital Medical Center in Daytona Beach, Fla., agreed to pay the government $85 million to resolve allegations that it had billed Medicare for care based on referrals from doctors who had a financial relationship with the institution, a forbidden practice.
Dr. Melgen appeared on investigators’ radar when a Medicare contractor noticed that he, a single practitioner, was billing for Lucentis at a significantly higher rate than his peers, Justice Department lawyers wrote in response to a suit the doctor filed against the Health and Human Services Department.
Each vial of the medication comes with up to four times the amount that a patient requires. Investigators said the doctor was using one vial to treat three or four patients, and billing as if he had purchased a new vial each time. The doctor would be reimbursed $6,000 to $8,000 for a vial that cost him $2,000.
The investigation concluded that in 2007 and 2008 alone, he overbilled by $9 million, which he was forced to pay back.
The doctor, federal lawyers said, “seeks to game the system by seeking reimbursement of three to four times its actual costs.”
Dr. Melgen hired the former head of the Justice Department’s Medicare fraud task force, Kirk Ogrosky, to defend him. In a lawsuit that sought to recover the $9 million, Mr. Ogrosky argued that Dr. Melgen’s billing practice was not illegal and that even if the doctor had not spread the medication out, the government would not have saved any money.
As the dispute dragged on, the doctor reached out to his longtime friend, Mr. Menendez, for help. Mr. Menendez’s aides acknowledged that the senator called the Medicare director at the Center for Medicare and Medicaid Services in 2009 and brought it up at a meeting with the acting administrator in 2012. Now both Dr. Melgen and Mr. Menendez find themselves under federal scrutiny. F.B.I. agents have raided Dr. Melgen’s clinics twice.
“At all times, Dr. Melgen billed in conformity with Medicare rules,” Mr. Ogrosky said in a statement. “While the amounts in the CMS data release appear large, the vast majority reflect the cost of drugs. The facts are that doctors receive 6 percent above what they pay for drugs, the amount billed by physicians is set by law, and drug companies set the price of drugs, not doctors.”
He declined to discuss the doctor’s relationship with the senator or his campaign contributions.
Dr. Qamar and his Institute of Cardiovascular Excellence in Ocala, Fla., have for at least the last 16 months been subject to what is known as a “prepayment review,” he said on Wednesday. Medicare officials typically take this step, which requires a detailed examination of all Medicare bills before they authorize payment, after they have detected patterns that lead them to suspect there may have been inappropriate or excessive bills.
The money paid to Dr. Qamar in 2012 — $18.2 million — is much more than to any other cardiologist in the United States. The second-highest total is listed as $4.5 million, paid to Dr. Ashish Pal of Davenport, Fla.
Dr. Pal said in an interview on Wednesday that his billing was entirely appropriate and fair, although he acknowledged it was high because he has multiple cardiology-related specialties, and because he works in an outpatient setting and bills the government for facility fees.
Dr. Qamar said his payments were high because his practice, which has 150 employees and a caseload of 23,000 patients, routinely handles complicated procedures like opening blocked arteries in the legs of older patients, which normally would be billed by a hospital.
Dr. Qamar has sent more than $100,000 to the Democratic National Committee and other state-based branches of the Democratic Party around the United States, and has donated to President Obama’s presidential campaigns and groups with ties to Mr. Obama, federal records show. He has also made donations to congressional candidates — almost all of them Democrats — from Nevada, Pennsylvania, Indiana, Iowa and Florida, among other states, the records show.
At the same time some of those donations were being made, the prominent law and lobbying firm Greenberg Traurig — and a former Justice Department official and Capitol Hill aide from the firm named Gregory W. Kehoe — helped Mr. Qamar contact more than a dozen members of Congress asking them to help him address why he was subject to such intense scrutiny from Medicare auditors.
The political donations, Dr. Qamar said, are unrelated to the Medicare scrutiny, but he acknowledged he had reached out to lawmakers in Congress to persuade the federal government to back down.
“The auditors put an astronomical burden on us, in terms of manpower,” he said. “I would just hope there is some end to it.”
Both Dr. Qamar and Dr. Melgen are still certified to receive Medicare payments, although Dr. Melgen at one point was suspended from the Medicare program, which accounts for 70 percent of his practice. He has been reinstated. And an official at the Department of Health and Human Services declined to comment on either physician or to confirm that they were a subject of special scrutiny.
The New Jersey pathologist ranked third among doctors nationwide in terms of Medicare billing, Dr. Michael C. McGinnis, is the medical director of the Pathology Corporation of America in Wrightstown, N.J., which performs analytical work on medical specimens for other doctors, perhaps explaining his high ranking on the list. Dr. McGinnis could not be reached for comment.
Frances Robles reported from Miami, and Eric Lipton from Washington. Michael Strickland contributed research.
Correction: April 9, 2014, Wednesday
This article has been revised to reflect the following correction: An earlier version of this article misidentified a political action committee to which Dr. Salomon E. Melgen contributed more than $700,000. It was Majority PAC, a super PAC run by former aides to the Senate majority leader Harry Reid, not the political action committee of Senator Robert Menendez, a New Jersey Democrat.
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