It started with a tip from inside the system.
A former employee noticed something wasn’t quite right with how procedures were being billed—and that tip has now led to an $847,394 settlement over false Medicare claims involving two Florida-based medical practices.
Dermatology Clinic and Surgery Center Accused of Overbilling Medicare
Forefront Dermatology S.C., operating in Florida as Henghold Dermatology, and Henghold Surgery Center LLC, which shut down in 2023, have agreed to pay the hefty settlement.
The U.S. government accused them of misrepresenting wound repair procedures following skin cancer surgeries, specifically Mohs micrographic surgeries, to Medicare.
These procedures, common in dermatology, involve the removal of skin cancer followed by wound repair.
The government claims the clinics inflated their bills by using inaccurate codes—making it seem like they performed more complex and expensive repairs than they actually did.
What Is “Upcoding” and Why It Matters
The alleged scheme centered around “upcoding”—a fraudulent billing tactic where providers submit codes for more expensive treatments than were performed.
In this case, linear wound repairs were falsely billed as flap repairs (which are more intricate and costlier), and small flap repairs were coded as if they were larger ones.
This led to Medicare paying out more money than necessary, drawing the attention of the Department of Justice (DOJ) and the Department of Health and Human Services Office of Inspector General (HHS-OIG).
Government Officials Speak Out on the Impact
Assistant Attorney General Brett A. Shumate of the DOJ’s Civil Division condemned the practice:
“Improperly billing Medicare depletes valuable government resources that provide necessary medical care to millions of Americans.”
U.S. Attorney John P. Heekin for the Northern District of Florida added:
“This office will continue to aggressively root out fraud, waste, and abuse… and hold those who defraud the federal government accountable.”
Christian J. Schrank of HHS-OIG emphasized how billing manipulation jeopardizes taxpayer funds and undermines trust in Medicare.
Whistleblower Doctor Receives Reward for Exposing Fraud
The case was originally brought forward by Dr. Christopher Wolfe, a former employee of Forefront, under the False Claims Act’s whistleblower provision (also known as “qui tam”).
This legal mechanism allows private individuals to sue on behalf of the government and share in any financial recovery.
Dr. Wolfe will receive $152,531 from the settlement for his role in uncovering the fraud.
A Coordinated Crackdown on Health Care Fraud
This settlement didn’t happen overnight. It was the result of a joint effort by the DOJ’s Civil Division, the U.S. Attorney’s Office for the Northern District of Florida, and HHS-OIG.
Legal professionals including Trial Attorney Colin Shannon and Assistant U.S. Attorneys John Spaccarotella, Mary Ann Couch, and Marie Moyle led the investigation.
The False Claims Act in Action
This case underscores the importance of the False Claims Act as a key tool in fighting healthcare fraud.
Officials encourage anyone with knowledge of similar misconduct to speak up.
Reports can be made to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
Final Note: No Admission of Guilt
It’s important to note that while Forefront Dermatology and Henghold Surgery Center agreed to pay the settlement, there has been no formal finding of liability.
The claims remain allegations.