Accusations: Acupuncture business owner allegedly defrauded Medicaid providers of over $1.75 million

Twin Cities acupuncture service owner faces more than a dozen felonies for her alleged role in a Medicaid billing scheme that, over the course of four years, raised more than $1.75 million in fraudulent payments.

A two-year investigation by Minnesota’s Medicaid Fraud Control Unit (MFCU) alleges that Xiaoyan Hu, the owner of the Chinese Acupuncture and Herb Center, ordered her employees to bill insurers for full-hour sessions while actual patient care typically lasted 30 minutes. , declares a criminal complaint.

From March 2016 to June 2020, the MCFU found 41,858 separate fraudulent claims at Hu’s sites in Burnsville, Edina, Minneapolis, St. Paul, and briefly Elk River. These alleged offenses took place in Hennepin, Ramsey, Scott and Sherburne counties, but prosecutors decided to consolidate them into one case filed in Hennepin County.

The 61-year-old Eden Prairie man is also accused of staging a scheme to bill providers for interpreting services that did not correspond to any appointment with a patient; investigators found 1,381 interpreter diaries that misrepresented services provided at the Chinese Acupuncture and Herb Center.

In total, Hu is charged with 17 counts of aiding and abetting theft by false representation, with varying levels of seriousness depending on the fraudulent payments received during the time period corresponding to each charge. Eight of the charges relate to thefts of $35,000 or more, each carrying a maximum sentence of 20 years and a fine of up to $100,000.

Process to be invoiced

Acupuncturists who spoke to MCFU investigators said the Chinese Acupuncture and Herb Center has a policy of charging one hour of acupuncture services for each appointment with a patient, regardless of the actual time spent in care. of the patient. A review of the Chinese Acupuncture and Herb Center’s internal schedule revealed 30,301 individual appointments. Of those, 29,736 – 98% – were listed as lasting 45 minutes or less, the criminal complaint states.

Additionally, the acupuncturists said Hu would ask them to tailor their care to how she wanted to charge, “not based on the needs of the client.”

When billing Medicaid, acupuncture services must use specific billing codes for each 15-minute treatment interval. Hu’s clinics typically bill using two codes: one for the initial one-on-one contact and insertion of one or more needles, and another for each additional 15 minutes of one-on-one contact with the patient and the reinsertion of needles.

The criminal complaint explains that the acupuncture service could not simply charge for the time a patient had a needle inserted and could not charge for individual contact when an acupuncturist is caring for multiple patients at once.

Hu told the acupuncturists to insert the needles as soon as the patients arrived, put them on the table and re-insert them later, the complaint states. One acupuncturist said she could handle two or three clients at a time and said seeing someone every 15 minutes was not uncommon.

This acupuncturist quit when she found out the company was charging an extra 30 minutes for all of her patients. She also told investigators that Hu told her to falsify medical records to make it look like patients were making progress to satisfy insurance companies. A second employee backed up that claim, saying Hu had asked him to modify patient records to accommodate requests from insurance companies.

Another acupuncturist said his patients would be there for about an hour, but only 20 minutes of that time was actually spent on acupuncture; the rest were cupping or Tui-Na, services not covered by Medicaid.

An acupuncturist said Hu’s motivation was for ‘the insurance to keep rolling’ and said Hu told staff to ‘only do light needlework so the patient feels a little better and wants to then come back.”

The Chinese Acupuncture and Herb Center also continued to bill patients after it stopped booking appointments. In one case, investigators found a patient who had received acupuncture for ‘no more than a month’, but the company continued to bill using her patient number for the next four years, ripping off $14,000. to insurers during this period.

“Do what the performers want”

The MCFU investigation also overturned a ploy distorting interpretation services for non-English speaking patients.

The complaint says that beginning in 2015, Hu attracted clients from Faribault who did not speak English. They would typically frequent Chinese Acupuncture and Herb Center sites in Edina and Burnsville.

Medicaid pays for interpreter services during medical appointments when the patient and practitioner do not speak the same language. Interpreters complete logs of services provided at medical appointments and the care provider verifies the logs.

However, the complaint says an analysis of interpretation logs and patient appointments showed that Hu’s company was charging for interpretation services when no acupuncture appointments were taking place.

Based on the acupuncturists’ accounts, Hu was fully aware of the fraud committed via interpreter logs, telling an employee to “just do what the interpreters want”.

The billing document says Hu would ask his employees to change appointment times in the calendar to match interpreter logs or sign interpreter logs for appointments that didn’t happen. In some cases, Hu or the interpreters asked the acupuncturists to sign blank registers. When an employee asked why she had to sign the document, Hu replied, “You don’t need to know.

Hu also signed the blank or falsified records herself, according to the complaint.

At one point during an interview with MCFU investigators, Hu blamed non-English speaking customers for her business’ problems, saying she had “a good reputation” before seeing them.

Accounts frozen

Investigators found that during the indictment period, more than $2 million had been transferred from the Chinese Acupuncture and Herb Center to Hu’s personal bank accounts, including proceeds from his company’s “fraudulent business” – a total of $1,750,798.31. Of these stolen funds, $62,337 came from fraudulent interpretation journals; the rest came from overcharging for acupuncture services.

A judge on Thursday granted Assistant Attorney General Nicholas Wanka’s request to freeze Hu’s personal checking and savings accounts, as well as four bank accounts associated with the Chinese Acupuncture and Herb Center, citing the “large amount of loss” and to prevent Hu from spending the stolen money while the case is pending.

Hu was charged by subpoena, and Hennepin County jail records show she was not arrested. His first court date has not been set.

Comments are closed.