DRAIN THE SWAMP! Landmark MEDICARE FRAUD Lawsuit Filed Against Omega Imaging Inc.


The United States has partially intervened in a False Claims Act lawsuit against William M. Kelly, M.D. Inc. and Omega Imaging Inc. in the U.S. District Court for the Central District of California, the Department of Justice announced today.  The government intervened as to allegations that the defendants, which operate 11 radiology facilities in Southern California, violated the False Claims Act by submitting claims to Medicare for unsupervised radiology services and services provided at unaccredited facilities.     

“Today’s announcement demonstrates the department’s commitment to protect the public fisc and ensure the safety of Medicare beneficiaries,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “The department will aggressively pursue unscrupulous healthcare providers who cut corners for profits and jeopardize the health and safety of Medicare beneficiaries.” 

Medicare requires that certain procedures, such as CT and MRI scans that involve intravenous contrast materials, be performed under “direct physician supervision,” which means that a physician must be present within the office suite during the procedure.  The lawsuit alleges that that defendants performed and billed Medicare for contrast procedures without the proper physician supervision.  The suit further alleges that certain of the defendants’ facilities lacked accreditation, which is a material Medicare billing requirement. 

The case was filed under the qui tam or whistleblower provisions of the False Claims Act Act, which allow private parties to file suit on behalf of the United States for false claims and to receive a share of any recovery.  The Act also permits the United States to intervene and take over the lawsuit, as it has done here in part.  Those who violate the Act are subject to treble damages and applicable penalties.       

The government’s partial intervention in this matter illustrates the government’s emphasis on combating health care fraud.  One of the most powerful tools in this effort is the False Claims Act.  Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, can be reported to the Department of Health and Human Services (HHS), at 800-HHS-TIPS (800-447-8477).

This case is being handled by the Department of Justice’s Civil Division with assistance from the Office of Inspector General of the Department of Health and Human Services.  The case is captioned United States ex rel. Syd Ackerman v. William M. Kelly, M.D., Inc. and Omega Imaging, Inc., Civil Action No. ED CV 13-02195 JGB (C.D. Cal.).

The claims in which the United States has intervened are allegations only, and there has been no determination of liability.

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