Physician Partners of America LLC (PPOA), a Tampa, Florida-based healthcare company, its founder Rodolfo Gari, and former chief medical officer Dr. Abraham Rivera, have agreed to a significant settlement of $24.5 million. This settlement resolves allegations of False Claims Act violations, stemming from claims that they billed federal healthcare programs for medically unnecessary services and engaged in unlawful financial arrangements with physician employees. The case also involved a false statement related to a Paycheck Protection Program (PPP) loan obtained during the COVID-19 pandemic.
Several PPOA-affiliated entities are also liable under this settlement, including Florida Pain Relief Group, Texas Pain Relief Group, Physician Partners of America CRNA Holdings LLC, Medical Tox Labs LLC, and Medical DNA Labs LLC.
The core allegations against Physician Partners of America (PPOA) center around the submission of claims for unnecessary urine drug testing (UDT). According to the allegations, PPOA mandated its physician employees to order a panel of UDT tests without proper individual patient assessment. This meant that doctors were allegedly required to order both initial presumptive UDT and subsequent definitive UDT without first reviewing the results of the presumptive tests to determine if further, more detailed testing was actually medically warranted. Subsequently, PPOA’s associated toxicology lab allegedly billed federal healthcare programs for the highest, most expensive level of UDT, regardless of medical necessity.
Adding to these concerns, the government further alleged that Physician Partners of America (PPOA) incentivized its physicians to order presumptive UDT by offering them a percentage – specifically 40% – of the profits generated from these tests. This practice is a potential violation of the Stark Law, which is designed to prevent physicians from referring patients for “designated health services” that are paid for by Medicare or Medicaid to entities with whom they have a financial relationship. Exceptions to the Stark Law are in place, but the allegations suggest these were not applicable in PPOA’s case.
Alt text: Physician reviewing urine drug testing results in a lab, highlighting potential unnecessary medical testing practices.
Beyond urine drug testing, the allegations also extend to genetic and psychological testing. The United States claimed that Physician Partners of America (PPOA) required patients to undergo both genetic and psychological evaluations before even being seen by a physician. This protocol allegedly occurred without any prior determination of medical necessity for these tests. Following these pre-physician evaluations, PPOA then allegedly billed federal healthcare programs for these tests, regardless of whether they were actually needed for patient care.
In a further layer of alleged misconduct, the government detailed actions taken by Physician Partners of America (PPOA) during the COVID-19 pandemic. When Florida suspended non-emergency medical procedures in March 2020 to curb the spread of COVID-19, PPOA reportedly sought to mitigate revenue losses through questionable billing practices. The allegations state that PPOA directed its physician employees to schedule patient evaluation and management (E/M) appointments every 14 days, a significant increase from their previous practice of monthly appointments. Furthermore, PPOA allegedly instructed its physicians to bill these more frequent E/M visits using inappropriately high-level procedure codes, maximizing reimbursement.
Compounding these issues, the United States also alleged that concurrently with this alleged overbilling scheme, Physician Partners of America (PPOA) applied for and obtained a $5.9 million loan through the SBA’s Paycheck Protection Program (PPP). In its application, PPOA allegedly falsely certified that it was not engaged in unlawful activities. The settlement announced today addresses liability under both the False Claims Act and the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA), covering the false claims submitted to federal healthcare programs for the E/M visits, as well as the false statement made in connection with the PPP loan.
“Billing federal healthcare programs for services that providers know are unnecessary or unreasonable undermines the quality of care that patients receive and increases the costs of these taxpayer-funded programs,” stated Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. He emphasized the Department’s commitment to ensuring healthcare decisions are patient-centric, not driven by financial gain.
U.S. Attorney Roger B. Handberg for the Middle District of Florida added, “Holding healthcare providers accountable for inflated claims and false statements helps ensure the integrity of the healthcare system as a whole. Settlements like this one are an important step in that direction.”
Peggy Delinois Hamilton, General Counsel for the SBA, highlighted the agency’s focus on swift and equitable pandemic relief distribution, stating, “The SBA takes fraud seriously and will continue to make it our priority to work alongside the Office of the Inspector General to identify and address any potential fraud to ensure sound administration of relief programs.”
Alt text: Government officials from HHS-OIG and DOJ discussing healthcare fraud and settlements, emphasizing accountability and program integrity.
In conjunction with the financial settlement, Physician Partners of America (PPOA) has also entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). This CIA mandates significant compliance efforts, including establishing a compliance department, appointing a medical director and oversight board, retaining a compliance expert, providing management certifications, implementing written standards, and conducting regular training and education programs. Furthermore, PPOA is required to undergo multiple annual claims reviews by an Independent Review Organization, establish a risk assessment and internal review process, and implement monitoring of testing referrals.
Special Agent in Charge Omar Pérez Aybar of HHS-OIG commented, “When health care providers bill taxpayer-funded health care programs for medically unnecessary services, they divert government funds designed to assist business owners during this pandemic. Our agency will work with our law enforcement partners to thoroughly investigate health care fraud schemes.”
Christopher Godfrey, Director of the Department of Labor (DOL) Office of Workers’ Compensation Programs (OWCP), noted the settlement’s impact on recovering funds for the Federal Employees’ Compensation Act, stating, “This settlement demonstrates the commitment of the DOL and its OIG in helping to ensure that funds issued through the program are paid appropriately.”
Special Agent in Charge Cynthia A. Bruce of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Southeast Field Office, emphasized the importance of patient-centered care, stating, “When actors within our health care system are focused on profit rather than patient care, it undermines the integrity of the medical decision-making process.”
David Spilker, Special Agent in Charge of the Department of Veterans Affairs Office of Inspector General’s (VA OIG) Southeast Field Office, highlighted the protection of veteran healthcare programs, saying, “This civil settlement reinforces the VA OIG’s commitment to safeguarding the integrity of VA’s healthcare programs and operations and preserving taxpayer funds.”
Special Agent in Charge Amy K. Parker of the U.S. Office of Personnel Management, Office of the Inspector General (OPM OIG), addressed the Federal Employees Health Benefits Program (FEHBP), stating, “This settlement demonstrates the OPM OIG’s commitment to protecting patients from tests that are not medically reasonable or necessary and safeguarding the FEHBP from fraudulent claims.”
The civil settlement also resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act by current or former employees of Physician Partners of America (PPOA) and its affiliates: Donald Haight, Dawn Baker, Dr. Harold Cho, Dr. Venus Dookwah-Roberts, and Dr. Michael Lupi. Whistleblowers, under these provisions, can file actions on behalf of the United States and receive a portion of any recovered funds.
This resolution is the result of collaborative efforts from the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section; the U.S. Attorney’s Office for the Middle District of Florida; HHS-OIG; VA OIG; DCIS; DOL OIG; and OPM OIG.
This case underscores the government’s dedication to combating healthcare fraud. The False Claims Act remains a critical tool in these efforts. Individuals with information about potential fraud can report it to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
The Department of Justice established the COVID-19 Fraud Enforcement Task Force on May 17, 2021, to combat pandemic-related fraud, further demonstrating the commitment to protecting government relief programs. Tips and complaints about potential fraud affecting COVID-19 relief programs can be reported via the Civil Division’s Fraud Section website or by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721.
Senior Trial Counsel David W. Tyler of the Civil Division and Assistant U.S. Attorney Lindsay Saxe Griffin for the Middle District of Florida handled this case.
It is important to note that the claims resolved by this settlement are allegations, and there has been no formal determination of liability.
