Allergy and Asthma Associates in Roanoke pleads guilty in healthcare fraud case

Acting U.S. Attorney Daniel Bubar and Virginia Attorney General Mark Herring announced today the finalization of a $2.1 million civil resolution with Roanoke-based Allergy and Asthma Associates Inc.

AAA had pleaded guilty in U.S. District Court in Roanoke this past June to one count of criminal healthcare fraud.

“When a medical practice fraudulently bills our Medicare and Medicaid programs, it diverts funds from the most vulnerable in our communities and must be held accountable,” Bubar said.  “Today’s civil resolution coupled with AAA’s criminal conviction in June marks the end of a lengthy investigation and demonstrates that we will work closely with our federal and state partners to hold providers responsible for healthcare fraud.”

“Individuals and health care providers who defraud our health care system are not only stealing from Medicare and Medicaid, but they are also stealing from taxpayers and they must be held accountable,” Herring said. “I want to thank both our state and federal partners, as well as my hardworking Medicaid Fraud Control Unit, for their dedication and partnership on this case.”

According to court documents, between 2010 and 2017, AAA submitted improper billings to Medicare and Medicaid for Xolair, an expensive asthma treatment sold in single-use vials. Due to the nature of the drug, many patients receive doses of the drug that require healthcare providers to administer a partial vial of the drug. This results in leftover amounts of Xolair that are not administered to the patient.

At relevant times, Medicare and Medicaid allowed providers to bill Medicare Part B and Medicaid one time for an entire single vial of Xolair, which includes both the administered quantity, as well as the discarded quantity of the drug from a single-use vial, up to the amount listed on the vial’s label.

In situations where a patient’s dose resulted in a leftover partial vial of Xolair, AAA administered the leftover amount to another patient and the billed Medicare and Medicaid for administering this amount as if it were the entire single-use vial.

From 2010 to 2017, AAA billed Medicare $627,540 for Xolair that AAA did not purchase. In addition, AAA received 129 vials of Xolair from Medicaid which is not documented as being used for a Medicaid patient. These 129 vials represent an approximate loss to Medicaid of $88,878.

Under the terms of the civil resolution finalized last week, AAA will pay a total of $2,149,607 to settle claims they violated the false claims act. Broken down, $1,994,607 will be paid to United States government and $154,648 will be paid to the Commonwealth of Virginia.