For Immediate Release:
Wednesday, September 9, 2020
Laura Brewer (919) 716-6484
(RALEIGH) Attorney General Josh Stein today reached a $900,000 settlement with two former managers, Michael Smith and Codey Brown, and the former owner, Dr. Harrison Frank, of the now-defunct Carolina Comprehensive Health Network PA (CCHN) to resolve allegations that they violated the False Claims Act and billed the Medicare and Medicaid programs for medically unnecessary diagnostic tests and procedures.
“When health care programs and providers cheat the Medicaid program, they’re cheating taxpayers,” said Attorney General Josh Stein. “My office will hold accountable any business and individual that commits fraud and wastes health care resources.”
“When health care professionals engage in deceptive schemes for the sake of their bottom line, their patients’ health is no longer their first priority,” said U.S. Attorney Andrew Murray. “Billing Medicare and Medicaid for unnecessary testing wastes taxpayer dollars and diverts funds intended for needed medical care. Working with our state partners, we will use all resources and tools at our disposal to pursue and hold accountable individuals who perpetrate fraud on federal health care programs.”
Before it ceased operations, CCHN consisted of a group of health care practices, including multiple locations in the Western District of North Carolina that provided family medicine, immediate care, and pain management services. The settlement resolves allegations that from May 1, 2015, through November 30, 2015, CCHN billed the Medicare and Medicaid programs for unnecessary diagnostic procedures including positional nystagmus testing, rotational axis testing, nerve conduction testing, and autonomous nervous system testing.
The allegations stem from a whistleblower lawsuit filed under the federal False Claims Act. The settlement is a result of the coordinated effort between the Department of Health and Human Services Office of the Inspector General, the North Carolina Attorney General’s Medicaid Investigations Division, and the United States Attorney’s Office for the Western District of North Carolina.
The claims resolved in this settlement are allegations only and there has been no determination of liability.
About the Medicaid Investigations Division (MID)
The Attorney General’s MID investigates fraud and abuse by health care companies and providers, as well as patient abuse and neglect in facilities that are funded by Medicaid. Medicaid is a joint federal-state program that helps provide medical care for people with limited income. To date, the MID has recovered more than $900 million in restitution and penalties for North Carolina.
The Medicaid Investigations Division receives 75 percent of its funding from the U.S. Department of Health and Human Services under a grant award totaling $6,160,252 for Federal fiscal year (FY) 2020. The remaining 25 percent, totaling $2,053,414 for FY 2020, is funded by the State of North Carolina.
To report Medicaid fraud in North Carolina, call the North Carolina Medicaid Investigations Division at 919-881-2320.