News & Trends - MedTech & Diagnostics
Cancer services provider accused of wrongly claiming payments
MedTech & Diagnostics News: A provider of cutting-edge cancer treatments has found itself in hot water as it has been revealed that the company wrongly claimed Medicare payments due to issues with its internal buy now, pay later system for radiation oncology treatments. This startling revelation comes as GenesisCare recently filed for Chapter 11 bankruptcy protection in the United States on June 1, sending shockwaves through the healthcare industry.
The company informed its doctors on April 28 that it would no longer be utilising its proprietary payment system called EasyPay. This decision was made after identifying issues related to the “reliability” of the system’s methodology for calculating out-of-pocket costs for patients.
Health Department officials, confirming the concerns raised by GenesisCare, stated that the company had notified them about the issues with EasyPay, which are currently under consideration. GenesisCare, previously owned by KKR, China Resources, and its employees, has been grappling with financial challenges, but a recent injection of funding from Oaktree Capital Management and other sources has provided a lifeline to keep its global operations afloat.
It is important to note that the overcharging problem did not affect patients directly, but it was uncovered during a comprehensive review of the company’s organisational structures and practices by its new CEO, David Young, who took charge almost two months ago. The extent of how far back these issues with EasyPay go remains unclear.
GenesisCare’s EasyPay system is primarily used for deferred payments in radiation oncology. However, it is crucial to highlight that the billing systems for medical oncology and theranostics are separate and have not been impacted by these concerns.
Acknowledging the overcharging voluntarily may help mitigate potential penalties, according to Medicare. Nevertheless, GenesisCare will be required to repay the incorrect payments. In a statement, a GenesisCare spokesman addressed the issue, stating that the company has identified the problems with EasyPay and has ceased its usage. They have also informed the Department of Health and Aged Care regarding the matter.
The significance of Medicare non-compliance and fraud has been magnified recently after a review commissioned by the government revealed that the current payments system is wasting a staggering $3 billion each year due to its complexity. The report, conducted by Pradeep Philip of Deloitte Access Economics, former head of the Victorian Health Department, highlighted that only a small fraction of the 500 million transactions through Medicare are scrutinised annually.
GenesisCare, founded in 2005 by Dan Collins in Brisbane, has rapidly expanded its operations worldwide. In 2019, it made a notable acquisition by purchasing Florida-based 21st Century Oncology in a deal worth $1.5 billion. With the support of Macquarie, KKR, and China Resources, GenesisCare now operates 440 clinics across the globe, with its Australian division considered one of the company’s strongest performers. The company also operates in the United States, the United Kingdom, and Europe.
Moving forward, one of the critical factors affecting GenesisCare’s future earnings potential will be the number of doctors who choose to remain with the company under its new management. In light of recent events, Australian doctors associated with GenesisCare are in the process of appointing their own adviser to navigate the challenges ahead.
Despite the turmoil, GenesisCare’s Chief Medical Officer, Dr Marie Burke, expressed confidence in the cohesion and commitment of the company’s doctor group. With many of them having worked together for nearly two decades, their core mission remains focused on providing exceptional patient care. Dr Burke stressed that this commitment to their patients has not wavered and will continue to guide them moving forward.
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