Memphis Nephrologist to Pay $375,000 in Medicare Fraud Settlement

A Memphis nephrologist has been ordered to pay more than $375,000 to settle allegations of fraudulent Medicare billing practices, according to federal and state investigators.

Dr. Mark Shermer, a kidney specialist practicing in the Memphis area, was found to have submitted false claims to Medicare for end-stage renal disease (ESRD) treatments for dialysis patients. According to investigators, Shermer billed the federal healthcare program despite never actually performing the treatments in question.

The case was jointly investigated by the Department of Health and Human Services Office of Inspector General (HHS-OIG) and the Tennessee Bureau of Investigation (TBI), who determined Shermer was liable for the fraudulent billing practices. Following their investigation, Shermer was ordered to pay $375,296.90 to resolve the case under the False Claims Act, a federal law that imposes liability on individuals who defraud governmental programs.

Medicare fraud involving ESRD treatments is particularly concerning to healthcare regulators. End-stage renal disease represents the final stage of chronic kidney disease, where the kidneys can no longer function adequately to meet the body’s needs. Patients with ESRD typically require dialysis treatments multiple times per week or a kidney transplant to survive.

The Medicare program spends billions annually on ESRD treatments, making it a frequent target for fraudulent billing schemes. According to healthcare compliance experts, nephrologists are required to conduct regular in-person assessments of dialysis patients and document their evaluations properly to qualify for Medicare reimbursement.

This case highlights ongoing efforts by federal and state authorities to crack down on healthcare fraud, which costs American taxpayers billions of dollars each year. The HHS-OIG estimates that healthcare fraud schemes collectively cost Medicare and Medicaid programs approximately $60 billion annually.

Dr. Shermer’s case is part of a broader pattern of enforcement actions against individual physicians who submit false claims. In recent years, federal prosecutors have increasingly targeted individual healthcare providers rather than just focusing on large institutional fraud schemes.

“When physicians bill for services they never provided, they’re not just breaking the law – they’re violating the trust of their patients and undermining the integrity of essential healthcare programs,” said a healthcare fraud attorney not associated with the case, speaking on condition of anonymity due to professional obligations.

The False Claims Act, under which Shermer was ordered to pay, allows the government to recover up to three times the amount of the fraud, plus additional penalties. The law also includes whistleblower provisions that enable private individuals with knowledge of fraud to file lawsuits on behalf of the government and potentially receive a portion of any recovered funds.

While court documents don’t specify whether a whistleblower initiated this case, healthcare industry analysts note that many Medicare fraud investigations begin with tips from current or former employees, patients, or competing practices.

The settlement does not indicate whether Shermer admitted to any wrongdoing, which is common in such civil resolutions. The court documents also don’t specify whether the case will impact Shermer’s medical license or his ability to participate in federal healthcare programs in the future.

The Tennessee Department of Health, which oversees physician licensing in the state, maintains a separate process for evaluating whether alleged misconduct warrants professional discipline.

Medicare fraud enforcement remains a priority for the Department of Justice and HHS-OIG, with hundreds of healthcare providers facing similar allegations each year across the country.