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Insurance Fraud Charges Levied Against UCI Clinic Or “I’ll Have 2 Poached Eggs To Go”
By Susan E. Clarke
With the many allegations coming out of the University of California, Irvine, fertility clinic scandal that broke earlier this year, one issue that has received only a bare minimum of news coverage is the issue of insurance fraud. And who could argue with the point of view taken by the media. After all, it isn’t every day we hear of human eggs being taken from one patient and, without the donor’s consent, transferred as embryos to other infertile women. But if one can believe the newspapers and the television newscasters, that is exactly what was happening. Throw in a few allegations of research misconduct and the insurance fraud issues are quickly pushed to the back burner.
There is nothing new about the type of insurance fraud that was allegedly going on at the three Center for Reproductive Health clinics run by Dr. Ricardo Asch and his partners, Dr. Jose Balmaceda and Dr. Sergio Stone. It was strictly garden-variety provider fraud. Instead of a non-covered, elective procedure, the patient’s carrier would be billed for a covered procedure. All the doctors and the insurance billers had to do in these cases was include the words “pain” and “ovarian cyst.” When these magic words were used and the forms were properly completed, elective surgeries performed for the purpose of egg retrieval suddenly became “medically necessary,” hence, insured.
Although the clinic’s three doctors insist that any insurance improprieties were caused by the medical billers, former employees at the clinics have stated that false insurance claims were routinely submitted at the doctors’ request in order to financially assist the clinic’s patients. These patients might otherwise run up enormous bills as they continued to undergo fertility treatments. And it didn’t hurt the doctors’ pocket-books either when the patients were able to return again and again to undergo expensive procedures they wouldn’t have been able to afford if not for the insurance coverage.
Auditors looking into the situation found that the patient records routinely reflect a diagnosis of “ovarian cyst,” and egg retrievals are regularly billed as “aspiration of ovarian cyst.” Strictly speaking, these are not out-and-out lies. An egg-containing follicle is a type of cyst, and the aspiration procedure is pretty much the same: the doctor inserts a needle into the cyst and aspirates the contents. If there is an egg in the cyst, it is sucked out along with the fluid. It is only the intent of the procedure—and the medical necessity—that is different. And, of course, the slight difference between receiving a payment check or receiving a notice of no coverage.
Very often, the patient is aware of the deception and quietly goes along with it. In some cases the woman has been trying to conceive a child for many years and the pressure of the ticking time clock brings about a sense of desperation. Some of these women would gleefully rob a bank if that was the price they had to pay for a pregnancy.
With the slightly adjusted claims forms, both parties benefit: the doctor increases his business and the patient gets insurance coverage for an expensive procedure that otherwise would not be covered. Only the insurance company loses.
The outcome of the University of California fertility clinic case is still up in the air. The clinics are no longer affiliated with UCI; Dr. Asch has opened a new clinic in Santa Ana. Several employees have lost their jobs, either because of clinic closures or because they reported their suspicions of clinic wrongdoing to authorities. About 40 patients are alleged to have been unwitting egg donors or recipients. The insurance fraud allegations pale in comparison to the ethical and moral questions surrounding this case.
The investigation is continuing; just how far it will reach is not yet clear.
THE PARTNERS:
Ricardo Asch, M.D. Director of the Centers for Reproductive Health. Dr. Asch, a world-renowned fertility specialist, was the developer of a fertilization technique known as gamete intra-Fallopian transfer (GIFT). He was also known to be a fan of horse racing and the owner of at least five race horses.
Sergio Stone, M.D. A partner in the clinics. Although Dr. Stone did not perform fertility procedures, he did share in the profits as a partner. He is currently on leave from his position at UCI and has opened his own office in Fountain Valley.
Jose Balmaceda, M.D. Another partner in the clinics. Dr. Balmaceda helped develop the GIFT procedure. He continues as director of the Saddleback Memorial Medical Center fertility clinic.
THE PROCEDURE:
GIFT: Gamete intra-Fallopian transfer is the procedure which drew patients to the clinic. It consists of surgical removal of a woman’s eggs, which are then mixed with some of her partner’s sperm and returned to her Fallopian tube. If the procedure is successful, the eggs and sperm will unite in the Fallopian tube to create an embryo, which will travel down the tube to the uterus where, if all goes well, it will implant and develop normally.
THE SCANDALS:
Unauthorized egg transfers. A number of women who have received treatment through the fertility clinics have been informed that the eggs they thought had been stored as embryos for their own future use have actually been used for other infertile couples. In at least two cases, these unauthorized embryo transfers have resulted in live births, raising untold legal and moral issues for the donor couple and the birth parents.
Questionable medical practices. Employees and former employees allege that the clinics were run in a somewhat unethical manner. Illegal fertility drugs were allegedly given to some patients; unlicensed foreign trainees were allegedly allowed to perform procedures; patients were allegedly kept waiting while the doctor attended to personal business.
Questionable financial practices. Not all income received by the clinic was reported to the University according to auditors who are investigating the situation. A large part of the income received was derived from fraudulent insurance claims. The doctors’ and clinics’ tax records are under review by a federal grand jury, and the US Attorney’s office is investigating the possibility of mail fraud charges.
Cover-up attempts by the doctors and the University. According to some former employees, Asch asked one front office worker to surreptitiously pull a list of particular charts for him. Records reviewed show the donors consented to donate eggs, but these donors disagree. The records appear to have been tampered with because the consent to donate is merely a checked box on the form and the check mark is in a different ink than the patient’s signature. One patient even alleges she was approached recently to give a postdated consent to donate her unused eggs. The catch is that the egg donation has already taken place. This particular patient refused to consent. The University’s part in the cover-ups continues to be revealed. Letters found in University files indicate the University knew about the situation long before it admitted anything to the public. The University requested that the doctors resign in exchange for keeping quiet about the scandal.
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