New details emerge about clinic forced to pay $2 million judgment
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IDAHO FALLS — New details explain how Alban and Ryan Hatch, the father and son owners of Amerihealth, violated the False Claims Act (FCA) and ended up being ordered to pay a $2 million judgment.
Through multiple settlement discussions, both parties agreed to resolve the case through a consent judgment.
According to Cassandra Fulghum, spokeswoman for the United States Attorney’s Office, a consent judgment is similar to a settlement, but unlike a private settlement, a consent judgment happens inside the court.
“The defendants (the Hatches) admitted to violating the False Claims Act as alleged in claim 1 in the complaint. The court thereafter approved and entered that judgment and ordered the $2 million fine,” said Fulghum in an email to EastIdahoNews.com. “A consent judgment is similar to a settlement, but it is ultimately imposed and approved by the court unlike many settlement agreements.”
The Hatches also resolved, without admitting guilt, to violating the Controlled Substances Act, the Anti-Kickback Statute (AKS), and fraudulently obtaining Paycheck Protection Program (PPP) loans during the COVID-19 pandemic.
RELATED | East Idaho health clinics consent to $2 million judgment to resolve fraud allegation
In a statement to EastIdahoNews.com, Jeremy Ward, Amerihealth’s Chief Management Officer, said Amerihealth will continue to provide medical care to eastern Idaho.
“Ryan and Alban Hatch are pleased to have resolved this matter with the government regarding their failure to properly supervise two of the company’s employees. We cooperated fully with the investigation,” says Ward. “There was no finding of an intent to mislead or underpay the government. With the matter resolved, we look forward to continuing to provide outstanding healthcare to our patients and meeting the urgent drug treatment and mental health needs of our communities.”
Background
According to the official criminal complaint, the Hatches formed AmeriHealth in 2012 “for the purpose of purchasing and/or operating health care clinics for profit.”
Between 2012 and 2022, the Hatches also formed other businesses including Stat Diagnostics, Inc., AmeriHealth, Inc., and America Healthcare, Inc. By 2018, the Hatches operated multiple health clinics under AmeriHealth, employing doctors, nurse practitioners, and medical assistants.
The clinics treated many patients insured by Medicare and Medicaid, so the Hatches billed the federal insurance programs for services provided to their patients by their medical providers.
Pandemic PPP Loans
During the COVID-19 pandemic, the U.S. Government offered the Paycheck Protection Program (PPP) to keep businesses running and employees paid.
Under the program, businesses could apply for the loans if they met certain conditions. After receiving a PPP loan, the companies could “seek forgiveness of those loans so long as the businesses used the PPP funds properly.”
According to court documents, the Hatches applied for and received PPP loans on “at least two occasions” and certified they were “(a) they were not engaged in illegal activity, (b) PPP funds would be used for eligible expenses, and (c) AAA American Healthcare, LLC suffered certain year over year (or quarter over quarter) losses that entitled the entity to PPP funds.”
Court documents say the Hatches falsely certified information to receive the loans, and then illegally obtained forgiveness. During this, they were able to have $783,802.50 in loans forgiven illegally.
The Hatch’s resolved these allegations without admitting guilt.
Hungover Nurse Practitioner
According to the complaint, the Hatches “recklessly hired and failed to properly supervise such inexperienced or compromised practitioners who then wrote more, and sometimes unnecessary or unsafe, prescriptions for controlled substances to AmeriHealth patients.”
In one instance, the criminal complaint states the Hatches hired a nurse practitioner in 2018, even though they knew the employee had “problems with alcohol and substance abuse at the time they hired (the nurse).”
The Hatches reportedly hired the nurse to manage medications for psych patients, but within six months, the Hatches directed the nurse to treat pain management patients, even though the nurse did not have a pain management certification.
Because the nurse had a known problem with alcohol and substance abuse, the nurse reportedly did not want to treat or prescribe controlled substances to pain management patients.
The complaint alleges the Hatches still told the nurse to treat pain management patients in order to keep getting paid. The Hatches also reportedly continued to pressure the nurse to prescribe controlled substances to the patients.
In 2019, court documents say the Hatches became concerned about the nurse’s alcohol abuse, so they “bought a breathalyzer for the sole purpose of testing (the nurse’s) alcohol level before (the nurse) started every shift.”
On Nov. 4, the nurse called AmeriHealth to inform the clinic they could not work because they were “sick, hungover, and otherwise impaired.” The nurse also stated they “were sufficiently impaired” to the point they were unable to drive to the clinic safely.
The Hatches were reportedly angry the nurse couldn’t work because it meant the clinic would have to cancel appointments, resulting in lost revenue. The Hatches instead told a medical assistant to “fetch” the nurse from their home and bring them to work, according to court documents.
The documents say the medical assistant drove to the nurses’ home and told the nurse that they “had to work” before driving the nurse to the clinic.
“Even though (the nurse) was sick, hungover and impaired, (the Hatches) pressured and required (the nurse) to see and treat patients on Nov. 4, 2019,” states the official complaint.
The nurse reportedly treated and prescribed controlled substances to patients on that day, for which the Hatches billed insurance, including Medicare and Medicaid.
The complaint states that in doing so, the Hatches, “billed Medicare and Medicaid for worthless services.”
In this instance, Medicare was billed $190.16, and Medicaid was billed $246.59.
Inexperienced Nurse Practitioner
In 2018, the Hatches hired a second nurse practitioner. According to court documents, the Hatches “knew or should have known (the nurse) had never before prescribed controlled substances or treated pain management patients.”
Even so, the Hatches assigned the nurse to work as a pain management provider and expected them to prescribe controlled substances to patients.
The complaint states the nurse asked to be trained to provide pain management services, but received “almost no training.”
The nurse continued to treat Medicare and Medicaid patients, after which the Hatches would refer and submit claims for reimbursement for services.
Between 2018 and 2019, the nurse saw one specific patient, identified as “patient B” in court documents, for chronic pain. The Hatches reportedly wrote patient B “prescriptions for controlled substances to treat that condition, including prescriptions for opioids like oxycodone.”
The complaint states the nurse knew other providers had also prescribed controlled substances to patient B, such as benzodiazepines and sleeping medication, that could react dangerously with opioids.
The Hatches reportedly told the nurse to continue prescribing controlled substances to pain management patients even after the nurse expressed concern about their lack of experience and after the Hatches medical director informed them the nurse’s “lack of experience was causing (the nurse) to issue unsafe and unlawful prescriptions that lacked a legitimate medical purpose.”
In this case, Medicaid paid $69.74.
Alleged kickback from drug testing lab
According to the official complaint, in 2015, the Hatches entered into a contract with “Lab 1,” which provides “urine drug testing services to health clinics and other medical practitioners.”
The Hatches agreed to “solicit and refer orders” for drug testing to the lab in the contract. In return, the lab decided to bill insurance for the orders referred to them by the Hatches, and then pay the Hatches “standard and accelerated commissions.”
Between 2016 and 2022, the lab processed orders for the Hatches and billed and collected money from insurance providers.
Court documents state that “Lab 1’s payment of these commissions and (the Hatches) receipt of these commissions violated the AKS and the FCA.”
The Hatch’s resolved these allegations without admitting guilt.