I google around WSJ's paywall.
Sounds like double-billing for physics QA.
By
John Carreyrou
Updated Nov. 13, 2014 6:48 p.m. ET
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The Justice Department is investigating whether a cancer-care giant improperly billed Medicare for a procedure when it administered radiation therapy to patients—the second time the company has faced federal scrutiny this year.
Federal prosecutors have requested an array of documents from 21st Century Oncology Holdings Inc. “concerning allegations” that it “knowingly billed for services that were not medically necessary and for services not rendered,” the company disclosed in a regulatory filing.
A spokesman for 21st Century Oncology said it “is providing the requested documents and information.” Constantine Mantz, its chief medical officer, said the procedure at issue helps improve patient care, and the company uses it for “purely” medical reasons, not financial ones.
The new probe follows a disclosure by the cancer-care company in May that the Justice Department and the Department of Health and Human Services’ inspector general are examining its use of an expensive bladder-cancer test. Both are civil investigations.
The company’s unusually large Medicare billings for the bladder-cancer test were the subject of a
Wall Street Journal page-one article last month. 21st Century Oncology has denied misusing the test and said its actions “were proper and in accordance with applicable Medicare guidelines.” It has said it is cooperating with the investigation.
The Fort Myers, Fla., company owns a network of cancer centers in 16 states. Its U.S. revenue totaled $646 million last year—55% of that from Medicare. The company’s main business is radiation therapy, a treatment that commands Medicare reimbursements of up to $30,000 a case.
At issue in the new investigation is a program called “Gamma” that 21st Century Oncology introduced at South Florida Radiation Oncology, a company it acquired majority-ownership of in February, according to people familiar with the matter.
The Gamma program, which the company already used at its own cancer centers before the SFRO acquisition, involves measuring the radiation patients are receiving while they are being treated to ensure it conforms with the original treatment plan.
Dr. Mantz said the practice is a quality-assurance measure that enables doctors to adjust the radiation beam optimally throughout the course of a patient’s treatment. But several current and former employees say it is unnecessary because ample other checks and simulations are already performed before treatment begins.
Joseph Ting, a former SFRO physicist who left the company this summer after 21st Century Oncology began using Gamma there, contends that the program has no real clinical utility; he believes its only real purpose is to bill more to Medicare. He says the program’s rollout contributed to his decision to leave.
Dr. Ting called the practice redundant. “It’s like when you look out the window and you see your car parked outside,” he said. “What they’re doing is they’re also walking over to the car, looking at it from the front and from the back and touching it and saying, ‘We now know the car is there.’ But they already knew the car was there when they looked out the window.”
Dr. Mantz said Dr. Ting’s analogy is flawed because “a tumor is not a static entity like a car parked outside.” It can change size and shape during the course of treatment, he said, requiring the radiation beam to be adjusted.
David Beyer, a radiation oncologist and president-elect of the American Society for Radiation Oncology, said that 21st Century Oncology’s Gamma program is “an atypical practice,” adding: “This is not something that’s routinely done and billed for” in other cancer centers.
In a regulatory filing the company made earlier this year in anticipation of an initial public offering of stock it has since canceled, 21st Century Oncology predicted that deploying Gamma in SFRO’s cancer centers would contribute to “over $7 million of annual synergies.”
A Wall Street Journal analysis of Medicare payment data released by the U.S. in April after a legal effort by the Journal shows that 21st Century Oncology collected nearly $10 million for the Gamma procedure in 2012—16% of what Medicare paid out nationwide to non-hospital providers.
Eighteen of the 20 doctors who billed Medicare the most for the procedure in 2012 were 21st Century Oncology employees.
New York private-equity firm Vestar Capital Partners is 21st Century Oncology’s main shareholder. After canceling its IPO this summer, 21st Century also received a $325 million preferred-equity investment from Canada Pension Plan Investment Board, Canada’s largest pension fund manager. The fund declined to comment.
