Medicare Compliance & Reimbursement

Golden State lab operator snared in $1.3 million fraud. When it comes to health care fraud, the long arm of the law stretches extremely far. Case in point: Leaving the United States for his native Philippines didn't help Ernesto Penaflorida evade federal fraud fighters pursing him for submitting bogus bills for blood tests. According to U.S. Attorney Debra Yang's office, Penaflorida pleaded guilty to health care fraud Nov. 3 after being extradited from the Philippines. Penaflorida admitted that he and others associated with his company, Medstat Clinical Laboratory, billed Medicare and Medi-Cal for tests that Medstat not only didn't perform, but didn't even have the capacity to conduct. The tests included RBC Protoporphyrin, a test that detects iron deficiency and lead poisoning; thin layer chromatography, a test used to detect drug metabolites; chemiluminescent assay, which helps identify chlamydia and tuberculosis; and sedimentation rate, which is used to measure inflammation and infection in rheumatism patients. The feds maintain that Medstat submitted $2.2 million in fraudulent bills, and collected about $1.3 million from Medicare. Penaflorida faces up to 10 years in prison when he's sentenced Feb. 2, 2004. Lesson Learned: Fraud fighters aren't hesitant to look far and wide when it comes to prosecuting Medicare billing abuses.