A Little Birdie Told Me
Independence Blue Cross
Routine data mining conducted at Independence Blue Cross (IBC) Corporate and Financial Investigations Department (CFIC) revealed that hundreds of fraudulent claims were received from an "unwitting" psychiatrist allegedly employed by New Start, Inc., a behavioral healthcare provider, which proved to document many "impossible days." The resulting fraudulent claims billed IBC in excess of 60 hours in one day relating to more than 50 patients. An investigation revealed healthcare fraud that took advantage of patients appropriately seeking care and totaled over $1 million
Program Elements
- The investigation faced a unique challenge. Pennsylvania law provides special protection for mental health records, but the court allowed an independent federal investigator, unrelated to the investigation, to summarize the records for federal investigators working with IBC . Highly sensitive and skilled interviews with patients receiving care at New Start, Inc. helped unravel the scheme, as did a judicious use of undercover operations.
- Interviews confirmed that New Start, Inc. grossly misrepresented the number of visits and diagnosis codes for billing purposes. In an egregious example, interviews confirmed that a couple received six sessions of marriage counseling while New Start, Inc. billed for 80 visits with false diagnoses.
- An undercover federal investigator posed as a patient in order to determine billing policies and practices. The agent attended yoga classes located in the same building as New Start, which were later billed to IBC as Acute Stress Disorder. New Start verified through IBC that the undercover agent's healthcare coverage included alcohol and substance abuse treatment.
Program Results
- The CEO of New Start, Inc. chose to use the name of a well-respected "unwitting" psychiatrist for many of the fraudulent claims. This particular psychiatrist was a noted ornithologist; many of the fraudulent claims were for dates when she was visiting South Africa, South America, Finland and elsewhere. Investigators were able to track some of these trips using logs posted on bird-watchers' Web sites, and cross-match the trip schedules with the services billed.
- Through the collaboration between CFID and federal investigators, the CEO of New Start, Inc., Raymond Newstadt, was sentenced to 30 months incarceration, 30 months probation and was ordered to pay over $1 million to IBC.
Contact
Ed Litchko, 215-241-2514, ed.litchko@ibx.com
