On December 10, 2025, the U.S. Attorney’s Office for the District of New Hampshire announced that telehealth company LifeWorks Counseling Associates and its owner Dr. David Ferruolo had agreed to pay $300,000 to resolve allegations that they violated the False Claims Act (FCA) by submitting claims for services provided by an excluded individual.
According to the government’s press release, LifeWorks submitted claims to Medicaid for services provided by Erik Alonso, who had previously been excluded from participating in federal healthcare programs in 2017 after pleading guilty to a Medicare fraud conspiracy. In addition to the FCA settlement, Alonso was again indicted for, and plead guilty to, healthcare fraud. The FCA press release noted that the FCA defendants fully cooperated in that criminal investigation.
In announcing the FCA settlement, Roberto Coviello, Special Agent in Charge for the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), stated that “the exclusion authority is a cornerstone of our efforts to protect federal health care programs from fraud and abuse. When providers submit claims to the Medicaid program for services rendered by excluded individuals, they violate a fundamental safeguard designed to ensure program integrity. This settlement sends a clear message: we will hold providers accountable when they fail to comply with exclusion rules.”
HHS-OIG has both mandatory and permissive exclusion authority. Mandatory exclusion applies where an individual or entity has been convicted of a healthcare-related criminal offense or certain other criminal offenses. The permissive exclusion authority is significantly broader, permitting HHS-OIG to exclude an individual or entity who engages in a wide range of conduct, including but not limited to submitting false or improper claims and engaging in fraud or kickback schemes. An individual or entity to knows — or should know — that another person is excluded but nevertheless submits claims for services provided by that excluded person, is also subject to their own significant civil and administrative liability, as this case shows.
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The attorneys at Chilivis Grubman represent health care companies of all types sizes in connection with government investigations, False Claims Act litigation, and other related matters. If you need assistance with such a matter, please contact us today.