Appellate Court Sends Patient Brokering Case Back to Judge

A Florida lower court judge was wrong to dismiss four counts in a multicount case against the owner of a drug testing lab who was charged in connection with Florida’s Patient Brokering Act, according to a ruling by the Fourth District Court of Appeals.

The Details

The case involved Mark Desimone who was charged with 13 counts of violating the Patient Brokering Act. The act makes it illegal to pay or accept “any commission, bonus, rebate, kickback, or bribe, directly or indirectly, in cash or in kind,” for the referral of patients.

Desimone was associated with Impact Q Laboratory which tested patient urine samples and then received payment for the tests from the patient’s insurance company. According to court documents, John Rizzo, received payments from Impact Q/Desimone for bringing patients from Safe Harbour Recovery Treatment Center, a substance abuse treatment facility, to Impact Q for testing.

Rizzo put Safe Harbour operators in touch with Desimone to make a deal for payments for the urine analysis business. Safe Harbour operatives set up an entity called United Recovery Consultants, LLC to receive payments. Impact Q made several payments to United as well as to Rizzo’s companies. These arrangements led to the charges against Desimone.

The Charges

The state charged one count of patient brokering for a Rizzo company, and another count on the same date for the same patient for a payment to United. Desimone moved to dismiss the counts for multiplicity.

Although the payments were for the same group of patient samples tested by Impact Q, the state claimed that its payments to different corporations for the same referrals should constitute separate patient brokering violations. Thus, the state argued it could charge Desimone for each payment to United, a separate entity, from the Rizzo corporations.

The Lower Court Ruling

The trial court held an evidentiary hearing and ultimately disagreed, granting Desimone’s motion to dismiss the charges that were duplicative. In doing so, the lower court described the payments as “payments that are issued on the same date, for the same patients or patronage, but are allocated to different corporations, or are in essence, ‘installment payments[.]’”

The lower court then dismissed the four counts alleging payments to United Recovery, leaving five counts against Desimone for payments to Rizzo’s corporations.

The case, which was appealed to Fourth District Court, addressed the question as to whether payments paid to different entities for referrals of the same patients on the same days can be charged as different violations of the Patient Brokering Act, or whether such payments constitute only one violation for each day.

The Appellate Court Ruling

The appellate court determined that the state properly charged Desimone for the separate payments to Rizzo and to United, as each payment was used to induce the referral.

The court sent the case back to the lower court for reinstatement of charges.

Florida has been a hotbed of illegal sober home activity including many instances of patient brokering. In 2016, a Palm Beach County sober homes task force was created to address the growing problem of unscrupulous addiction recovery and treatment/drug rehab home operators.

As we wrote about in 2017, Governor Rick Scott signed into law HB 807, commonly referred to as the “Practices of Substance Abuse Service Providers Act.” The law gave state regulators broader powers as it pertains to treatment and recovery residence communities.

How We Can Help

In addition to providing many other healthcare law defense and compliance services, The Health Law Offices of Anthony C. Vitale represents individuals and entities such as drug treatment facilities and laboratories accused of fraud by federal and/or state authorities for violations of the Patient Brokering Act, the federal Anti-kickback statute, the state Anti-kickback statute and state civil false claims.