Norman medical billing company’s financial failure prompts lawsuit

April 06--NORMAN -- A medical billing company utilized and partially owned and managed by the Norman Regional Hospital Authority has financially failed amid allegations of billing irregularities -- putting some 42 employees temporarily out of a job.

Employees of Axis Practice Solutions LLC and related company Axis Practice Management Inc. were fired March 9 and told to immediately leave their Norman office, taking only personal items with them.

Action was taken to secure patient billing records and company financial records as allegations of possible fraud, double-billing and attempted blackmail surfaced in litigation initiated by local doctor Brian Yeaman, who is also part owner.

The Norman Regional Hospital Authority has shifted its billing business to Legacy Medical Management LLC, which has hired many, but not all of Axis' former employees, said Patrick Rich, who served as chief operating officer of the failed Axis Practice Solutions.

Rich is among those who remain unemployed.

Roy Orr, president and chief executive officer of Axis Practice Solutions prior to the collapse, was indicted by a New Mexico grand jury in May 2012 on allegations of embezzlement, credit card theft, and fraudulent use of an illegally obtained credit card.

Judy Hamilton Morse, attorney for the Norman Regional Hospital Authority, said she believes hospital officials were unaware of Orr's New Mexico legal problems until Dr. Yeaman referred to them recently in his Cleveland County lawsuit.

Orr was accused in New Mexico of embezzling thousands of dollars from a victim with whom he had contracted to perform billing services, court documents reveal.

Two of the alleged criminal acts occurred in September 2009, just weeks before Axis Practice Solutions and Axis Practice Management commenced operations in Norman. Orr continued to operate those new companies while dealing with his legal problems in New Mexico.

Orr entered into a deferred prosecution agreement in 2012 and the three-count charge against him was ultimately dismissed by New Mexico prosecutors in May 2014.

Orr's predecessor company in New Mexico, Axis Healthcare Financial Group Inc., had more than $634,000 in federal tax liens filed against it for unpaid employer taxes and employee tax withholdings from 2004 through 2011, court records indicate.

Orr's attorney, Jayne Jarnigan Robertson, declined comment.

Billing issues

The Norman Regional Hospital Authority served notice on Axis in February that it believes it was overcharged by more than $1.37 million from November 2009 through December 2014.

"Obviously it's unfortunate, but it doesn't threaten the financial viability of the hospital," Morse said.

Rich, Axis' former chief operating officer, acknowledged that the hospital authority was overcharged, but said his projections based on an examination of two or three years worth of records would estimate the overcharges to be in the range of $600,000 to $700,000 rather than $1.37 million.

Rich said the duplicate billings were "unintentional."

The hospital uses an electronic medical records system and the over billings occurred after Axis converted from a monthly to a weekly invoicing system. Certain types of payments were not accounted for properly after the change, he said.

The problem went undiscovered for years while the over payments continued to accumulate. Rich said Axis relied on that income, added employees and began providing additional services to the Norman Regional Hospital Authority at no extra cost. When the error was discovered, the company found itself in a financial bind from which it was unable to recover, he said.

Whether patients and their insurance companies should be concerned about the accuracy of their billings is unclear.

"I'm not aware that any patients have received any billings that were not proper," Morse said. "The only thing I'm aware of is that the hospital got over billed."

However, Dr. Yeaman sent an email to hospital officials Oct. 5 expressing concerns about billing issues and alterations in his reports.

"I'm not accusing anyone of going back and fixing charges, but it is concerning," Dr. Yeaman</person> wrote. "I am very concerned about some of this activity and I'm concerned that no one has discussed this with me, including Roy Orr. I do not know what all this means, but I do not approve of my billing being apparently re-worked and calculated without discussing this with me and a full review of what is proceeding and why."

"Again, I don't know what all this means, but I want to put everyone on notice, there is something strange and somewhat suspicious without my consent occurring with my billing account inside Axis," he wrote.

Morse said the hospital plans to do an audit that should uncover any billing problems that may have occurred.

Extremely personal

Dr. Yeaman initially pursued court action against Axis last October after the company, wallowing in financial troubles, failed to make payment on a $25,456 debt on an American Express card used by Axis employees and guaranteed by Dr. Yeaman.

Rich said Dr. Yeaman encouraged others to incur charges against his credit card so he could get credit for the points.

Since then, the conflict between Dr. Yeaman, the hospital authority and Axis officials has gotten extremely personal.

Other Axis officers joined forces to oust Dr. Yeaman as an officer and director of Axis Practice Management after the doctor retained forensic computer and accounting experts to begin examining company financial records.

And Rich has written a series of angry emails to Dr. Yeaman and his attorney accusing the doctor of accepting $23,000 from him for the purchase of shares in Xenith Health LLC, Axis Practice Management LLC and Yeaman and Associates LLC, and then failing to transfer the shares.

Violation of policy

Rich has repeatedly demanded the shares or the return of his money. He has threatened to pursue criminal charges against the doctor and "engage in a strategic communication campaign" against Dr. Yeaman using "the press, social media, and word of mouth."

Dr. Yeaman's attorney, Christopher Keim, wrote an email to Norman Regional Hospital Authority's attorney raising concerns that Rich's actions were a potential violation of Axis policy and could be interpreted as "extortion and blackmail" under Oklahoma law.

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