Lawyers for Independent Review Organization (IRO) believe the controversial $71 million dollar contract between Broward Health and Zimmerman Advertising may have violated the Federal Anti-Kickback Statute. The Baker Donelson law firm was hired by the US Department of Health and Human Services to operate the IRO as part of settlement agreement with Broward Health. The IRO report is the second fact finding body troubled by the multi-million dollar deal involving former Broward Health Chairman David Di Pietro, the late Broward Health CEO Nabil El-Sanadi and Broward County Commissioner Chip LaMarca.

According to the IRO, just one month after becoming the new Broward Health CEO, Dr. Nabil El-Sanadi met with Jordan Zimmerman. Three months later, Broward Health paid Zimmerman Advertising $2.1 million dollars for “marketing sevices.” The report states, “Nine days after the contract was entered into, Zimmerman hired Broward County Commissioner Chip LaMarca as its Vice President of Community Relations.”

Based upon interviews and other sources, the report states, “[I]t appears attorney and Chair of the [Broward Health] Board of Commissioners David Di Pietro desired to increase the $2.1 million contract.” One interviewee told investigators that LaMarca was a client of Di Pietro.

The report reveals investigators were troubled by the June 2015 fundraiser for Judge Nina Di Pietro held at Zimmerman Advertising offices. “The IRO is concerned that physicians, apparently while engaged in Focus Arrangement contract or renewal negotiations with [Broward Health], were apparently donors to her campaign.” Judge Nina Weatherly Di Pietro is the wife of David Di Pietro.

Two months later, LaMarca met with El-Sanadi and Broward Health CIO Doris Peek at a Fort Lauderdale Waffle House. The IRO reported the same information contained in the Berger Singerman review previously reported by REDBROWARD. According to both reports, Peek stated LaMarca pushed for an expansion of the Zimmerman contract. She told the IRO, “LaMarca advised them that his role was to develop new mutually-beneficial opportunities for [Broward Health] and Zimmerman.”

According to Peek, “LaMarca implicitly threatened Dr. El-Sanadi with termination if he did not agree to expanding the contract.” In The Berger Singerman report, Peek claimed LaMarca said, “I put you here, and I can take you out.”

By October 2015, the IRO report states the relationship between Jordan Zimmerman and El-Sanadi became “strained.” Numerous delays kept the new Zimmerman contract from coming before the Board. According to the report, two commissioners took issue when El-Sanadi pulled the contract from a board meeting agenda. When El-Sanadi pulled the item from the agenda, “Di Pietro and Board Commissioner Maureen Canada became ‘very upset.'”

Earlier this year, REDBROWARD revealed the close ties between Maureen Canada and Chip LaMarca. In 2006, the Florida Department of Law Enforcement (FDLE) investigated Chip LaMarca’s role at a local electrical construction firm. The FDLE report exposed close ties between Chip LaMarca and the family of Broward Health Commissioner Maureen Spieker Canada.

It appears Di Pietro and Canada were upset over El-Sanadi’s attempts to place performance measurements in the new Zimmerman Advertising contract. Interviewees told IRO investigators, “Di Pietro and Canada were opposed [to] anything that could delay the amendment and/or expansion of the contract or to the inclusion of the performance measurements.”

VIOLATIONS OF FEDERAL STATUTE

During a December 2015 meeting, Jordan Zimmerman gave a PowerPoint presentation detailing two separate deals. An “incremental growth option” would be just $10 million while the “accelerated growth option” would cost $15 million. Peek told investigators that Zimmerman stated that under the “accelerated growth option,” Broward Health would receive a 411 percent increase in return on investment (ROI). This would mean a $115 million increase for Broward Health.

Under the “incremental growth” plan, Broward Health would see a 290% ROI or $60 million. According to the IRO, then Broward Health CFO Bob Martin “expressed reservations about the Jordan Zimmerman ROI representations and assumptions.”

The IRO states El-Sanadi’s insistence on performance measurements would eventually doom the Zimmerman deal. The Board made one additional $1.5 million advertising buy in December 2015. The original contract would end and, “Shortly thereafter, LaMarca resigned his position with Zimmerman.”

El-Sanadi would commit suicide in January 2016.

The report states, “The assertions of specific ROI and ‘accelerated growth’ and ‘incremental growth’ in the Zimmerman proposal raise serious concerns regarding AKS (anti-kickback statute) prohibitions.” The AKS prohibits soliciting, receiving, offering or paying any remuneration (including any kickbacks, rebates or bribes) in return for referrals of individuals for federal healthcare program services. The reports states, “While the statute is an intent-based statute, the scope of the statute is so broad that financial arrangements, including compensation and ownership arrangements, which are normal and commercially reasonable in other contexts, may in fact be a federal crime when implemented in the context of persons or entities who are in a position to refer patients to a health care provider or entity which bills Medicare, Medicaid or any other Federal or state payor program with respect to such patients.”

Finally, the IRO states it, “Believes the attempted transaction may implicate the AKS because it could result in the referral of government-funded beneficiaries and because the payment options were based on ROI. As a result, we will leave the determination for the the appropriate federal and state officials to investigate, if they deem it necessary.”

Published reports claim Federal and state investigators continue to examine business practices at Broward Health.