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PRESS RELEASE: Former Owner, Mark T. Conklin, Of Florida Home Health Care Companies Agrees To Pay $1.75 Million To Resolve Kickback And False Claims Act Allegations

Department of Justice
U.S. Attorney’s Office
Middle District of Florida
FOR IMMEDIATE RELEASE
Wednesday, March 2, 2016

Former Owner Of Florida Home Health Care Companies Agrees To Pay $1.75 Million To Resolve Kickback And False Claims Act Allegations

Tampa, FL – Mark T. Conklin, the former owner, operator and sole shareholder of Recovery Home Care Inc. and Recovery Home Care Services Inc. (collectively RHC) has agreed to pay $1.75 million to resolve a lawsuit alleging that he violated the False Claims Act by causing RHC to pay illegal kickbacks to doctors who agreed to refer Medicare patients to RHC for home health care services, the Department of Justice announced today. Conklin sold the RHC companies to National Home Care Holdings LLC, on Oct. 9, 2012.

“Inducements of the type at issue in this case are designed to improperly influence a physician’s independent medical judgment,” said U.S. Attorney A. Lee Bentley, III for the Middle District of Florida. “This lawsuit and today’s settlement evidence our office’s ongoing efforts to safeguard federal health care program beneficiaries from the effects of such illegal conduct.”

From 2009 through 2012, Conklin spearheaded a scheme whereby RHC, headquartered in West Palm Beach, allegedly paid dozens of physicians thousands of dollars per month to serve as sham medical directors who supposedly conducted quality reviews of RHC patient charts. According to the government’s lawsuit, the physicians in many instances performed little or no work, but nevertheless received thousands of dollars from RHC. The government’s complaint contended that these payments were, in fact, kickbacks intended to induce the physicians to refer their patients to RHC, in violation of the Anti-Kickback Statute and the Stark Law.

These laws are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives. The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by federal health care programs, including Medicare. The Stark Law forbids a home health care provider from billing Medicare for certain services referred by physicians who have a financial relationship with the entity. A person who knowingly submits, or causes the submission, to Medicare of claims that violate either the Anti-Kickback Statute or the Stark Law is also liable for treble damages and penalties under the False Claims Act.

“Individuals who seek to increase their profits by providing physicians with illegal inducements will be held personally accountable,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “We will continue to identify, investigate and, where appropriate, sue individuals and corporations that misuse funds meant to provide critical medical services for beneficiaries of federal health care programs.”

“Home health agency owners who seek to boost profits by paying kickbacks to physicians in exchange for patient referrals will instead pay for their improper conduct at the settlement table,” said Special Agent in Charge Shimon R. Richmond of U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “We will continue to crack down on such illegal, wasteful kickback schemes, which can undermine impartial medical judgment and corrode the public’s trust in the health care system.”

The United States previously reached a settlement with RHC’s purchaser, National Home Care Holdings, on March 9, 2015, for $1.1 million.

The settlement with Conklin, which is subject to approval by the Bankruptcy Court for the Southern District of Florida, concludes a lawsuit originally filed by Gregory Simony, a former RHC employee, under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The act also allows the government to intervene and take over the action, as it did in part in this case. Simony will receive up to $315,000 of the proceeds of the Conklin settlement.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $27.4 billion through False Claims Act cases, with more than $17.4 billion of that amount recovered in cases involving fraud against federal health care programs.

The settlement was the result of a coordinated effort by the Civil Division’s Commercial Litigation Branch, the U.S. Attorneys’ Offices for the Middle District of Florida and the Southern District of Florida and the HHS-OIG.

The case is captioned United States ex rel. Simony v. Recovery Home Care, et al., Case No. 8-12-cv-2495-T-36TBM (M.D. Fla.). The claims resolved by the settlement are allegations only and there has been no determination of liability.

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