For Whom the Whistle Blows #2: More Debris From the Fate of Fata

The scalpel of surgeon Farid Fata, M.D. continues to cut from beyond the metaphorical grave, i.e., from behind the walls, gates, and concertina wire of the United States Penitentiary in Atlanta, Georgia.

In mid-2015, Dr. Fata traded in his scrubs for a prison uniform when he was sentenced to 45 years in jail for a healthcare fraud scheme. He raked in approximately $34 million by providing medically unnecessary chemotherapy to over 500 patients.

In a whistleblower action related to Fata, Rita Dubois, a former employee of Vitas Health Corporation Midwest, a large player in hospice care, alleged that Vitas and related entities violated the False Claims Act and the federal Anti-Kickback Statute by paying Fata for patient referrals.

The complaint alleged that the defendants contributed approximately $16,000 to a Fata-formed charity, the Swan For Life Cancer Foundation, and that, in return, Fata referred 23 patients to Vitas for hospice care.

Vitas denied the allegations but settled earlier this month with the U. S. Department of Justice. Vitas paid $200,000, without acknowledging any wrongdoing.

The Takeaways for You

Violations of the federal Anti-Kickback Statute don’t require cash in an envelope or even direct payments at all. Even the solicitation, receipt, offer, or payment of indirect remuneration in return for the referral of a federal health care program patient is a crime.  Setting aside Vitas and its intent, I’ve seen many other instances in which medical groups and hospitals have attempted to obtain kickbacks via “requests” for “contributions” to charitable entities.

Once again, the Vitas case demonstrates that whistleblowers are almost always home-grown. The answer to the ever-popular question, “But, who will ever find out?” is one of your own staff.

Let’s take Vitas at their word and assume that they had no intention of any wrongdoing. I’d guess that the $200,000 they paid the government to put this behind them pales in comparison to what they paid in defense fees. Even if you have deep pockets, very deep pockets, is this what you’d want to spend your cash on?

In carpentry, they say “measure twice, cut once.”

In constructing deals and other arrangements with anyone to whom you refer or who refers to you, measure at least thrice (i.e., get expert advice) so you don’t get cut.

Comment or contact me if you’d like to discuss this post.

Mark F. Weiss

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