Florida oncology network that bilked cancer patients gets $67 million in COVID-19 aid

Florida Cancer Specialists said that coronavirus relief dollars from taxpayers will not be used to pay back their fines.
Florida Cancer Specialists opened a cancer treatment facility at Lakewood Ranch in December of 2019.
Florida Cancer Specialists opened a cancer treatment facility at Lakewood Ranch in December of 2019. [ Florida Cancer Specialists ]
Published May 10, 2020

A Fort Myers-based oncology network that was Florida’s largest recipient of federal coronavirus relief dollars for healthcare facilities admitted last week to participating in a criminal conspiracy that limited treatment options available to cancer patients in order to maximize profits.

Florida Cancer Specialists, which employs 250 doctors in 100 facilities across Florida, admitted in federal court on April 30 that it worked with unnamed co-conspirators to limit cancer treatment options for patients, agreeing to pay a $100 million federal fine — the largest amount allowed by law — along with a $20 million state fine.

At nearly the same time, Florida Cancer Specialists was awarded $67 million in federal funds from the CARES Act, the $2 trillion coronavirus relief bill passed by Congress in March. The $67 million made Florida Cancer Specialists the largest recipient of funds in Florida from a $30 billion pot of money distributed by the Department of Health and Human Services to help healthcare facilities affected by the pandemic.

Florida Cancer Specialists’ $67 million in funding was more money than the total given by HHS to any of Miami-Dade County’s five congressional districts, even though Miami-Dade has the state’s highest COVID-19 infection and death rates of any large county.

In a statement, Florida Cancer Specialists said Friday that coronavirus relief dollars from taxpayers will not be used to pay back their fines.

“Like hundreds of community-based oncology centers across the United States, we received this grant to offset costs associated with the impact of the COVID-19 pandemic,” Florida Cancer Specialists Chief Legal Officer Tom Clark said in the statement. “During this health crisis, we have continued to keep the doors of our more than 80 Florida facilities open to ensure that cancer patients have access to care and treatment. We plan to use these funds, if needed, in accordance with government guidelines, to continue providing affordable, safe and high-quality cancer care.”

Florida Cancer Specialists received more money from the first round of CARES Act funding than any other cancer-specific hospital, clinic or related provider around the country, according to a Miami Herald analysis of healthcare provider data compiled by HHS.

More than 600 cancer-specific hospitals, clinics and related providers around the country got a total of more than $560 million from the CARES Act. Florida Cancer Specialists’ $67 million in funding was $3 million more than New York City’s Memorial Sloan Kettering Cancer Center was awarded and $15 million more than what was given to Texas Oncology, the largest community oncology network in the country.

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Florida Cancer Specialists received the eighth most funds of any provider who has been awarded funding so far.

Former Florida hospital executive and Pennsylvania congressman Jason Altmire said the massive federal grant shouldn’t have been awarded to a healthcare business that was simultaneously paying a huge fine for conspiring against patients.

“This is not something that should’ve happened, but given that we’re dealing with emergency circumstances that led to some people getting more money than they should,” said Altmire, now a public affairs consultant working in Florida.

Altmire said he wasn’t aware that Florida Cancer Specialists had received $67 million from the CARES Act, but called their antitrust practices “an egregious and textbook example of collusion.”

According to a deferred prosecution agreement filed in the U.S. District Court in Fort Myers, Florida Cancer Specialists and their unnamed co-conspirators agreed not to compete to provide chemotherapy and radiation treatments to cancer patients in Southwest Florida. Instead of one provider offering multiple services, Florida Cancer Specialists made an illegal agreement to provide chemotherapy services exclusively while competitors exclusively provided radiation treatments.

The Department of Justice said the scheme ran from 1999 to 2016 in Collier, Lee and Charlotte Counties.

“Today’s resolution, with one of the largest independent oncology groups in the United States, is a significant step toward ensuring that cancer patients in Southwest Florida are afforded the benefits of competition for life-saving treatments,” said Assistant Attorney General Makan Delrahim in an April 30 statement. “For almost two decades, FCS and its co-conspirators agreed to cheat by limiting treatment options available to cancer patients in order to line their pockets. The Antitrust Division is continuing its investigation to ensure that all responsible participants are held accountable to the maximum extent possible.”

The Justice Department’s deferred prosecution agreement also refers to four unnamed companies that worked with Florida Cancer Specialists to limit competition. In addition to paying the fine and admitting wrongdoing, Florida Cancer Specialists also agreed to cooperate with the Justice Department’s investigation, which is ongoing.

The Justice Department did not return a request for comment.

Florida Attorney General Ashley Moody’s office, which announced a $20 million fine on the same day as the Justice Department’s fine, said the state office will ensure that coronavirus funds from Congress are not used to pay the fine, which will be paid to the state in installments for four years beginning this fall.

“We will not tolerate funds federally distributed to address serious COVID-19 concerns to go towards resolving outstanding obligations by this company to the State of Florida,” Florida Attorney General spokesperson Lauren Cassedy said in an email in response to questions from the Herald. “The company must use distributed funds for COVID-19 purposes and we have obtained that assurance from them.”

Additionally, Florida Cancer Specialists signed a document with HHS certifying that CARES Act funds “will only be used to prevent, prepare for, and respond to coronavirus” or for lost revenues attributed to coronavirus.

Employees of Florida Cancer Specialists, which employs doctors across the state, have donated more than $320,000 to federal lawmakers and political committees in the last five years. Florida Cancer Specialists operates clinics across the state, though their only locations in South Florida are in Palm Beach County.

Florida Cancer Specialists CEO Brad Prechtl in 2016 donated $5,400 to the Trump Make America Great Again committee, a joint fundraising committee that supported the Trump campaign and the Republican National Committee.

A spokesperson for Miami-based Jackson Memorial Health System, Florida’s largest hospital, said the public health system is confident that future rounds of funding from HHS will prioritize hard-hit areas. Jackson received $24 million in the first round of funding, about a third of Florida Cancer Specialists’ $67 million.

“Our focus right now is continuing to work with HHS to make sure they understand the magnitude of the need in South Florida and specifically at Jackson, and giving them the data they need to help out,” Jackson Vice President & Chief Marketing Officer Matthew Pinzur said in an email. “They are moving more quickly and more decisively than anyone would have expected, and I think we’re confident that they’re trying in good faith to get a huge amount of money out the door without a slow or overly complicated methodology.”

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