Wednesday, November 30, 2011

Akinsunbo Akinbile The Owner of Houston Health Care Company Pleads Guilty to Defrauding Medicare


Source- http://www.fbi.gov/houston/press-releases/2011/owner-of-houston-health-care-company-pleads-guilty-to-defrauding-medicare-1

WASHINGTON—The owner of a Houston health care company pleaded guilty today in connection with a Medicare fraud scheme involving durable medical equipment (DME), announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

Akinsunbo Akinbile, 44, pleaded guilty before U.S. District Judge Keith P. Ellison in Houston to eight counts of health care fraud.

Akinbile admitted that he was the owner and operator of Hallco Medical Supply, a company that purported to provide DME to Medicare beneficiaries. According to court documents, Hallco submitted claims to Medicare for DME, including orthotic devices, that were medically unnecessary and/or never provided. Many of the orthotic devices were components of “arthritis kits,” and purported to be for the treatment of arthritis-related conditions. The arthritis kits generally contained a number of devices including braces for both sides of the body and related accessories such as heat pads. In total, from June 2007 through May 2009, Hallco submitted approximately $737,770 in fraudulent claims to Medicare.

At sentencing, scheduled for Feb. 15, 2012, Akinbile faces a maximum sentence of 10 years in prison.




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Tuesday, November 29, 2011

Doctor Gwendolyn Washington Sentenced to 120 Months for Public Corruption, Illegal Prescription Drug Trafficking, and Health Care Fraud


Source- http://www.fbi.gov/detroit/press-releases/2011/southfield-family-practice-doctor-gwendolyn-washington-sentenced-to-120-months-for-public-corruption-illegal-prescription-drug-trafficking-and-health-care-fraud

Gwendolyn Washington, M.D., age 67, was sentenced today to 120 months’ imprisonment for public corruption, health care fraud, and conspiring to illegally distribute prescription drugs, United States Attorney Barbara L. McQuade announced. McQuade was joined in the announcement by Andrew G. Arena, Special Agent in Charge, Federal Bureau of Investigation, Detroit Field Division, and Lamont Pugh, III, Special Agent in Charge, Department of Health and Human Services, Office of Inspector General. Dr. Washington was sentenced by the Honorable Paul D. Borman.

On March, 7, 2011, Dr. Washington pleaded guilty to conspiring to defraud and defrauding the Detroit Public School (“DPS”) system of over $3.3 million. Dr. Washington, along with her sister Sherry Washington, and others doing business as “Associates for Learning” paid kickbacks to Stephen Hill, former DPS Executive Director of Risk Management, who authorized their submission to DPS and payment by DPS of grossly inflated invoices for services allegedly rendered to DPS in the form of a wellness program.

On July 28, 2011, Dr. Washington pleaded guilty to four felony counts involving drug trafficking and health care fraud. At her plea, Washington admitted that between 2004 and 2010, she performed unnecessary ultrasounds, nuclear cardiac stress tests, balance tests, sleep tests, and nerve conduction tests on patients, who were urged to return to Washington’s office every few months for repeat tests, even though initial results were normal. Washington billed Medicare and Blue Cross and Blue Shield more than $5 million for these tests, some of which were potentially harmful to patients. Most significantly, Dr. Washington ordered unnecessary and actively harmful nuclear stress tests for her patients at a frequency beyond that of any other medical practice in the country. Because each of these tests is the radiation equivalent of at least 80 to120 chest x-rays and because excess radiation creates a greater risk of cancer, Dr. Washington exposed her patients to a substantial risk of cancer.

Dr. Washington also admitted that she solicited and received kickbacks from home health care agencies and diagnostic testing facilities in return for referring patients to them for medical services. Washington referred patients to home health agencies, falsely certifying them as being confined to the home, in return for payments from home health care agencies of $200 to $500 per patient. In return for ordering nuclear stress tests, Dr. Washington received $200 per test. In total, Washington received $350,000 in total kickback payments. Medicare paid approximately $2.8 million to agencies receiving the fraudulent referrals. Washington received another $250,000 directly from Medicare for false certifications of patients for home health services.

Dr. Washington also admitted to committing two counts of controlled substances offenses. In February 2010, when Medicare suspended payments to Washington, resulting in a drastic reduction in her income, she began writing prescriptions for tens of thousands of doses of OxyContin, Opana ER, and Roxicodone, highly addictive pain medications that have a significant “street value” on the illicit market. Washington sometimes wrote prescriptions for individuals who were not her patients, without an examination or determination of medical necessity, and without an appropriate diagnosis or entry in a patient chart. Washington then provided these illegal prescriptions to Virginia Dillard, her niece and codefendant. Dillard filled the prescriptions at various pharmacies in Highland Park, Warren, and Detroit. After filling the illegal prescriptions, Virginia Dillard delivered the controlled substances to prescription drug dealers in exchange for money. Dillard sold each filled prescription in amounts ranging from $1,000 to $2,200, and shared the proceeds with Washington. Dillard was sentenced, on October 20, 2011, to 112 months’ imprisonment.




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Monday, November 28, 2011

Former Maxim Healthcare Services Senior Manager Bryan Lee Shipman Sentenced to Prison for Health Care Fraud


Source- http://www.fbi.gov/newark/press-releases/2011/former-maxim-healthcare-services-senior-manager-sentenced-to-prison-for-health-care-fraud

TRENTON, NJ—A former senior manager and 13-year employee of Maxim Healthcare Services, Inc. (“Maxim”), was sentenced today to five months in prison and five months of home confinement with electronic monitoring for his involvement in the unlicensed operation of Maxim office that billed nearly a million dollars to government health care programs, J. Gilmore Childers, First Assistant U.S. Attorney announced.

Bryan Lee Shipman, 38, of Athens, Ga., pleaded guilty in Trenton federal court on June 17, 2010, to an Information charging him with one count of health care fraud. Shipman was charged in connection with his role as a regional account manager supervising Maxim’s decision to open and operate Maxim’s Gainesville, Ga., office without a license from 2008 through 2009, when he and others directed billings from that office to be submitted for reimbursement by the Medicaid program as if they were from another, licensed office. Shipman entered his guilty plea before U.S. District Judge Anne E. Thompson, who also imposed the sentence today in Trenton federal court.

On Sept. 12, 2011, Maxim—one of the nation’s leading providers of home healthcare services—entered into a settlement agreement to resolve criminal and civil charges relating to a nationwide scheme to defraud Medicaid programs and the Veterans Affairs program of more than $61 million. Maxim was charged in a criminal Complaint with conspiracy to commit health care fraud, and entered into a Deferred Prosecution Agreement (“DPA”) with the Department of Justice. The agreement allows Maxim to avoid a health care fraud conviction on the charges if it complies with the DPA’s requirements. As required by the DPA, Maxim agreed to pay approximately $150 million—a criminal penalty of $20 million and approximately $130 million in civil settlements in the matter, including to settle federal False Claims Act claims.

Shipman is one of nine individuals—eight former Maxim employees, including three senior managers, and the parent of a former Maxim patient—to have pleaded guilty to and been sentenced on felony charges arising out of the submission of fraudulent billings to government health care programs, the creation of fraudulent documentation associated with government program billings, or false statements to government health care program officials regarding Maxim’s activities.

According to documents filed in this and related cases and statements made in court:

Shipman had been employed by Maxim for 13 years, the last eight as a regional account manager. As a regional account manager, Shipman reported directly to one of two nationwide vice presidents, who in turn reported to Maxim’s president. He also managed 13 offices in 2008 with hundreds of employees and total annual sales of more than $42 million, much of which derived from government programs. In his last full year of employment, Shipman earned more than $325,000, and was among the top 25 individuals at Maxim in terms of compensation out of the more than 80,000 individuals employed by Maxim in that year.

Shipman’s annual compensation—which ranked him within the top .03 percent of the Company—was based to a significant degree on meeting sales goals. Shipman said his superiors demanded levels of growth based “not on any market analysis, but simply on a belief that dramatic growth was necessary regardless of market conditions.” It was in response to that pressure, Shipman said, that he authorized and supervised the unlicensed operation of the Gainesville office.

At one point, when Maxim employees believed a state regulator would be visiting the office, lower-level employees were directed by Shipman and others to provide false information to the state regulator in an effort to prevent the Medicaid program from learning about the unlicensed operation of the office.

In addition to the prison term, Judge Thompson sentenced Shipman to two years of supervised release and ordered him to pay a $10,000 fine.

The other eight individuals who pleaded guilty were sentenced by Judge Thompson as follows:

Gregory Munzel, 35, of Charleston, S.C., was employed as a regional account manager, reporting directly to a vice president, responsible for Maxim offices throughout the southeastern United States. He pleaded guilty on Dec. 4, 2009, to one count of making false statements relating to health care fraud matters. During his plea hearing, Munzel admitted that he was aware individuals he supervised were submitting time cards for work that had not actually been done—a practice Munzel said was in response to pressure from Maxim superiors to increase revenue. Munzel also acknowledged forging caregiver credentials such as CPR cards throughout his time at Maxim, in order to make it appear that the caregivers were properly credentialed, when they were not. Munzel indicated he learned the practice from his supervisors when he first joined Maxim, and that those under him engaged in the practice when he took on a leadership role with the company. Munzel was sentenced on Sept. 29, 2011, to three months of home confinement as part of a two-year term of probation. Munzel was also ordered to pay a $1,000 fine.

Matthew Skaggs, 39, was employed as a regional account manager, reporting directly to a vice president, responsible for Maxim’s offices in Texas. He pleaded guilty on Sept. 23, 2010, to making false statements relating to health care fraud matters. During his plea hearing, Skaggs acknowledged having knowingly made false statements to a surveyor from Texas’ Medicaid Program, who was investigating the operation of an unlicensed Maxim office in Houston. Skaggs was sentenced on June 10, 2011, to a three-year term of probation and ordered to pay a $4,000 fine.

Andrew Sabbaghzadeh, 30, of Clay, N.Y., was employed as an account manager; and Jason Bouche, 27, of Paradise Valley, Ariz., was employed as a recruiter at Maxim’s Tempe, Ariz. office. They pleaded guilty to health care fraud on Nov. 4, 2009, and April 23, 2010, respectively. During their plea hearings, Sabbaghzadeh and Bouche acknowledged creating fraudulent time cards in order to bill government programs. They acknowledged that in some instances, Maxim employees cut signatures from legitimate time cards and pasted them onto forged time cards in order to submit them for reimbursement. Sabbaghzadeh was sentenced on Sept. 26, 2011, to six months of home confinement as part of a three-year term of probation. Sabbaghzadeh was also ordered to pay a $2,000 fine. Bouche was sentenced on Nov. 17, 2011, to a two-year term of probation and ordered to pay a $500 fine.

Donna Ocansey, 49, of Medford, N.J., was employed as a director of clinical services (supervising nurse) in Maxim’s Cherry Hill, N.J., office. She pleaded guilty on May 28, 2010, to making false statements relating to health care fraud matters. Ocansey, a registered nurse (RN), had responsibility for, among other things, ensuring that Medicaid-required supervisory visits of patients were conducted periodically—meaning that an RN periodically visited each patient to check each patient’s condition and the care the patient was receiving from Maxim Home Health Aides, who lack the skills and training of RNs. During her plea hearing, Ocansey acknowledged that she fabricated documentation in order to make it appear that other nurses had conducted Medicaid-mandated supervisory visits, when in fact they had not. Ocansey stated that she fabricated documentation in response to pressure from her superiors at Maxim, who expected her to make sure that all supervisory visits were completed without providing adequate resources for her to do so. Ocansey was sentenced on Oct. 18, 2011, to four months of home confinement as part of a a three-year term of probation. Ocansey was also ordered to pay a $2,000 fine.

Mary Shelly Janvier-Pierre, 43, of Lake Worth, Fla., and Sandy Cave, 39, of West Palm Beach, Fla., pleaded guilty to health care fraud on Feb. 1, 2010, and June 21, 2010, respectively. During their plea hearings, Janvier-Pierre, who had been employed by Maxim’s West Palm Beach office as a licensed practical nurse; and Cave, the mother of a former pediatric patient of Maxim, admitted to their roles in a scheme to fraudulently bill Medicaid, through Maxim, for services that were not rendered. Janvier-Pierre and Cave acknowledged that they agreed to submit billings as if Janvier-Pierre was taking care of Cave’s child, when she was not. Janvier-Pierre and Cave then split the money Janvier-Pierre received for purportedly providing the care. As a result of the scheme, Maxim was paid more than $70,000 by Florida’s Medicaid program. Janvier-Pierre was sentenced on Sept. 21, 2011, to six months of home confinement as part of a three-year term of probation. Cave was sentenced on Nov. 17, 2011, to five months of home confinement as part of a three-year term of probation. Cave was also ordered to pay a $1,000 fine.

Marion Morton, 45, of North Charleston, S.C., was employed as a home health aide and personal care assistant by Maxim’s Charleston, S.C., office. He pleaded guilty on May 3, 2010, to one count of making false statements relating to health care fraud matters. During his plea hearing, Morton acknowledged that, at the instruction of Maxim employees, he fabricated timecards reflecting work he had not done. On multiple occasions, Maxim submitted bills to Medicaid based on timecards which showed he worked more than 24 hours on certain days. Morton was sentenced on May 24, 2011, to a three-year term of probation and ordered to pay a $5,000 fine.




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Sunday, November 27, 2011

Dr. Richard Alan Behnan Pleads Guilty to Health Care Fraud


Source- http://www.fbi.gov/detroit/press-releases/2011/clarkston-podiatrist-pleads-guilty-to-health-care-fraud

Dr. Richard Alan Behnan, D.P.M., 55, of Clarkston, Michigan, pleaded guilty to a federal indictment charging him with Conspiracy to Commit Health Care Fraud, United States Attorney Barbara L. McQuade announced today.

McQuade was joined in the announcement by Andrew G. Arena, Special Agent in Charge, Federal Bureau of Investigation, Detroit Field Division and Lamont Pugh, III, Special Agent in Charge, Department of Health and Human Services, Office of Inspector General.

Behnan was a traveling podiatrist who provided services at various senior centers and assisted living facilities in Bay City, Flint, Detroit, and Lansing, Michigan. Behnan and his co-defendant, Kelly Morel, provided routine foot care to patients consisting primarily of toenail trimming. The two routinely billed these services to health insurance companies, including Medicare and Blue Cross Blue Shield of Michigan (BCBSM ), as a surgical procedure. Specifically, Behnan and Morel trimmed toenails and billed the service as a nail avulsion. A nail avulsion is a surgical procedure used to treat ingrown toenails wherein the nail, or portion of the nail, is removed or torn from the nail bed below.

The investigation revealed that patients never received nail avulsion procedures from Behnan or Morel as they claimed. Further, investigators determined that Behnan and Morel billed Medicare for surgical procedures performed while Behnan traveled outside the United States. As a result of all nail avulsion claims submitted from September 2000 to December 2010, Behnan and Morel received $1,624,089.66 from Medicare and BCBSM.

Previously, on May 26, 2011, following four days of trial, Kelly Morel, 49, of Davison, Michigan, pleaded guilty to conspiring to commit health care fraud along with Behnan and eleven substantive counts of health care fraud.




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Saturday, November 26, 2011

Gary Winner Pleads Guilty to Health Care Fraud, Money Laundering and Selling Adulterated and Misbranded Medical Devices


Source- http://www.fbi.gov/boston/press-releases/2011/nationwide-supplier-of-medical-equipment-pleads-guilty-to-health-care-fraud-money-laundering-and-selling-adulterated-and-misbranded-medical-devices?utm_campaign=email-Immediate&utm_medium=email&utm_source=boston-press-releases&utm_content=49960

PROVIDENCE, RI—The owner of Planned Eldercare, a nationwide supplier of durable medical equipment located in Buffalo Grove, Ill., pled guilty today in U.S. District Court in Providence, R.I., to defrauding the Medicare program by targeting arthritic and/or diabetic Medicare beneficiaries, and ensuring that his company ordered and shipped medical equipment and supplies to Medicare beneficiaries that they did not order and/or were not medically necessary.

U.S. Attorney Peter F. Neronha announced the guilty plea of Gary Winner, 49, of Northbrook, Ill., to two counts of health care fraud, and one count each of money laundering and the introduction of an adulterated and misbranded medical device into interstate commerce. Winner faces a maximum sentence of 33 years’ imprisonment, a fine of $760,000, and a term of supervised release of four years when he is sentenced on February 10, 2012. Winner has agreed to forfeit approximately $2 million in proceeds derived by defrauding the Medicare program.

Winner admitted to the court that from 2005 through early 2009 he instructed Planned Eldercare employees, upon successfully reaching individuals as a result of unsolicited telemarketing calls, to inquire if they suffered from diabetes or arthritis. Once call recipients identified themselves as suffering from either ailment, as an inducement for recipients to provide their Medicare and physician information, employees were instructed to inform recipients that Planned Eldercare could provide them with products to help with their ailments “at no cost to you.” Once employees obtained Medicare beneficiaries’ agreement to receive certain products, Winner instructed employees to order as many products as possible whether or not the beneficiaries requested them or had a medical need for the equipment. Winner admitted that Medicare was billed for thousands of products that beneficiaries did not order.

Winner also admitted that he instructed his employees to falsely inform male diabetic beneficiaries that an “erectile pump” was good for prostate problems, and was designed to help blood circulation exclusively in the urinary tract and prostate region. Winner admitted that as part of the scheme, he ordered penis enlargers from an x-rated website for $26.00 each, repackaged them with an information sheet stating that regular use of the enclosed “erectile pump” helps with bladder control, urinary flow and prostate comfort, and then shipped them to recipients. Winner received in reimbursement from Medicare an average of $284 per item.

Winner also admitted that he waived copayments for all Medicare patients, a practice which is prohibited by Medicare. By waiving copayments they otherwise would be responsible for, Winner induced beneficiaries to accept products they had not ordered and not report the alleged fraudulent billing to Medicare.




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Friday, November 25, 2011

Ramchand Ramrup, aka Ramy Ramrup Pleads Guilty to Medicare Fraud and Kickback Scheme


Source- http://www.fbi.gov/miami/press-releases/2011/fort-lauderdale-area-assisted-living-facility-manager-pleads-guilty-to-fraud-and-kickback-scheme

WASHINGTON—The manager of a Fort Lauderdale, Fla.-area assisted living facility and owner of a purported community mental health center pleaded guilty yesterday for his role in a Medicare fraud kickback scheme that funneled patients through a fraudulent mental health company, American Therapeutic Corporation (ATC), announced the Department of Justice, FBI and Department of Health and Human Services (HHS).

Ramchand Ramrup, aka Ramy Ramrup, 35, pleaded guilty before U.S. District Judge Marcia G. Cooke in Miami to one count of conspiracy to commit health care fraud. Ramrup was the manager and operator of Boynton Beach Assisted Living Facility (BBALF) and the owner of a purported community mental health center called Florida Behavioral Specialists Inc.

Ramrup admitted that in exchange for illegal health care kickbacks, he agreed to provide Medicare beneficiaries who resided at BBALF to ATC for intensive mental health treatment called partial hospitalization program (PHP) services. ATC purported to operate PHPs in seven different locations throughout south Florida and Orlando. According to court documents, Ramrup was paid approximately $40 per Medicare beneficiary per day the beneficiary attended ATC for purported PHP treatment. ATC paid the kickbacks by check made out to Florida Behavioral Specialists Inc.

According to court documents, Ramrup knew that ATC would fraudulently bill Medicare for the PHP treatment that his referrals would purportedly receive at ATC. Ramrup admitted that he did not refer beneficiaries to ATC because a physician had ordered PHP treatment. He referred beneficiaries to ATC because, among other things, he would receive kickbacks, his referrals were covered by Medicare and they were willing to attend ATC.

According to court filings, ATC’s owners and operators paid kickbacks to owners and operators of assisted living facilities and halfway houses and to patient brokers in exchange for delivering ineligible patients to ATC and its related company, the American Sleep Institute (ASI). In some cases, the patients received a portion of those kickbacks. Throughout the course of the ATC conspiracy, millions of dollars in kickbacks were paid in exchange for Medicare beneficiaries who did not qualify for PHP services. The ineligible beneficiaries attended treatment programs that were not legitimate so that ATC and ASI could bill Medicare more than $200 million in medically unnecessary services.

According to the plea agreement, Ramrup’s participation in the fraud resulted in more than $873,200 in fraudulent billing to the Medicare program. At sentencing, scheduled for Feb. 8, 2012, Ramrup faces a maximum of 10 years in prison and a $250,000 fine.

ATC, its management company Medlink Professional Management Group Inc., and various owners, managers, doctors, therapists, patient brokers and marketers of ATC, Medlink and ASI, were charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed on Feb. 15, 2011. ATC, Medlink and nine of the individual defendants have pleaded guilty or have been convicted at trial. Other defendants are scheduled for trial April 9, 2012, before U.S. District Judge Patricia A. Seitz.




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Thursday, November 24, 2011

Robert Spano Charged with False Statements Regarding Health Care Matters


Source- http://www.fbi.gov/philadelphia/press-releases/2011/former-middle-smithfield-township-supervisor-charged-with-false-statements-regarding-health-care-matters

The United States Attorney’s Office for the Middle District of Pennsylvania announced that a former supervisor in Middle Smithfield Township, Monroe County, was indicted yesterday by a federal grand jury in Scranton for making false statements in connection with health care benefits.

According to United States Attorney Peter J. Smith, Robert Spano, age 62, was charged with two counts of violating a federal statute prohibiting the making of false statements in connection with a health care matter.

The indictment alleges that Spano, while he was a Superviser as well as an employee of Middle Smithfield Township, participated in the township’s group health benefits plan administered by Blue Cross of Northeastern PA and in the township’s dental care benefits plan administered plan by United Concordia.

Spano allegedly completed health insurance and dental insurance enrollment forms in November of 2007, in which he listed his girlfriend, referred to in the indictment as “C.B., “ as his spouse, and as having the last name “Spano,” when, in fact, her last name was not “ Spano” and she was not his spouse. The indictment alleges that Robert Spano was still legally married to another person, and filed for divorce from his wife in January of 2011.

Allegedly, as a result of Spano’s misrepresentations, Middle Smithfield Township, Blue Cross of Northeastern Pennsylvania, and United Concordia incurred expenses totaling approximately $24,488 for medical and dental services provided to C.B. and for higher health insurance premiums between 2007 and 2010.

If convicted, the defendant faces a maximum penalty of five years in prison, followed by a three year term of supervised release and a $250,000 fine.




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Wednesday, November 23, 2011

Foot Doctor Errol Sherman Pleads Guilty to Medicare Fraud Scheme


Source- http://www.justice.gov/opa/pr/2011/November/11-crm-1530.html

WASHINGTON – A Detroit-area foot doctor pleaded guilty today for his participation in a Medicare fraud scheme, announced the Department of Justice, FBI and the Department of Health and Human Services (HHS).

Errol Sherman pleaded guilty before U.S. District Judge Gerald E. Rosen in the Eastern District of Michigan to one count of health care fraud. At sentencing, Sherman faces a maximum penalty of 10 years in prison and a $250,000 fine.

According to the plea documents, Sherman is a Doctor of Podiatric Medicine licensed in the State of Michigan. Between January 2003 and December 2006, Sherman billed Medicare and Blue Cross Blue Shield of Michigan for a procedure known as an “avulsion of the nail plate” or “nail avulsion” procedure. Sherman billed for this procedure thousands of times with respect to hundreds of beneficiaries during that time period. According to court documents, Medicare was billed by Sherman for nail avulsion procedures that were never rendered.

Today’s guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.




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Tuesday, November 22, 2011

United States Files Complaint Against BestCare Laboratories, Inc, Alleging False Claims for Medicare Funds


Source- http://www.justice.gov/opa/pr/2011/November/11-civ-1523.html

WASHINGTON – The United States filed a complaint against BestCare Laboratories, Inc. and its founder and principal, Karim A. Maghareh, in the U.S. District Court for the Southern District of Texas, the Justice Department announced today. The suit alleges that the defendants knowingly misrepresented the distances traveled by its lab technicians to artificially increase reimbursement from Medicare for mileage-based technician travel allowance fees.

According to the complaint, BestCare transported laboratory test specimens as air cargo from nursing home customers located in the Austin, Dallas/Ft. Worth, El Paso, San Antonio and Waco areas to BestCare’s laboratory close to Houston, but claimed mileage for ground travel as though its technicians personally drove the specimens one-way or round-trip between those cities and its lab in Houston. The complaint also alleges that Mr. Maghareh supervised BestCare’s day-to-day operations and directed or authorized the false billing. BestCare is a clinical laboratory founded in 2002.”

“There’s no question that health care providers are entitled to recover their reasonable costs for services they actually deliver, but we have zero patience for those who invent or inflate Medicare reimbursement claims,” said Assistant Attorney General for the Civil Division Tony West. “As today demonstrates, the Justice Department will vigorously enforce the False Claims Act to protect our seniors and safeguard the Medicare trust fund.”

“Our office is dedicated to recovering tax payer dollars misappropriated from Medicare,” said Kenneth Magidson, U.S. Attorney for the Southern District of Texas. “We are committed to aggressively litigating civil suits against dishonest providers to protect the seniors who depend on Medicare.”

The original lawsuit was filed by Richard Drummond under the qui tam, or whistleblower,provisions of the False Claims Act. The qui tam provisions allow private parties, called “relators,” to sue on behalf of the United States persons or companies they believe have knowingly submitted false claims for government funds. Relators are entitled to receive 15 to 25 percent of any recovery if the United States intervenes in the suit, as it has here, or 25 to 30 percent if the United States declines intervention. Defendants who violate the False Claims Act are liable for three times the government’s damages plus civil penalties.




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Monday, November 21, 2011

Sara Elicia Garza and Valerie Jean Flores Indicted on Federal Health Care Fraud and Conspiracy Charges


Source- http://www.fbi.gov/houston/press-releases/2011/pharmacy-owner-and-technician-indicted-on-federal-health-care-fraud-and-conspiracy-charges

MCALLEN, TX—Sara Elicia Garza, 55, and Valerie Jean Flores 38, both of Mission, Texas, have been arrested on charges of health care fraud and conspiracy to commit health care fraud, United States Attorney Kenneth Magidson announced today along with Texas Attorney General Greg Abbott.

A federal grand jury in McAllen returned the 15-count sealed indictment on Nov. 15, 2011. In it, Garza is charged with one count of conspiracy to defraud the Texas Medicaid/Vendor Drug program, one count of conspiracy a defraud Humana Insurance, seven counts of submitting false and fraudulent claims to the Texas Medicaid/Vendor Drug program and five counts of submitting false and fraudulent claims to Humana Insurance. The indictment also charges Flores with one count of conspiracy a defraud the Texas Medicaid/Vendor Drug program and seven counts of submitting false and fraudulent claims to the Texas Medicaid/Vendor Drug program. The indictment was unsealed today after the pair was taken into custody by federal and state authorities this morning. Both appeared before United States Magistrate Judge Dorina Ramos today for an initial appearance on the charges and a detention hearing. Judge Ramos ordered that Garza be released on a $100,000 bond with a 10 percent cash deposit and that Flores be released on a $50,000 unsecured bond. Garza and Flores are scheduled to be arraigned on Nov. 23, 2011, at 11:00 a.m.

Garza is a pharmacist and the owner and operator of Sara’s Pharmacy and Gift Corner located in Mission, Texas, while Flores was formerly employed by Garza as the senior pharmacist technician at Sara’s Pharmacy. In July 2011, agents from the FBI and the Medicaid Fraud Control Unit of the Texas Attorney General’s Office executed a federal search warrant and seized documents and computers at Sarah’s Pharmacy and Gift Store. The pharmacy closed on or about Oct. 28, 2011, while the gift store remains operational.

The indictment alleges that Garza and Flores conspired to send false and fraudulent bills to the Texas Medicaid/Vendor Drug program and to Humana Insurance and that they submitted false and fraudulent claims to Medicaid/Vendor Drug and to Humana for prescription medications that were never dispensed or provided to the Medicaid beneficiaries or the persons insured by Humana. The indictment alleges that false and fraudulent claims for prescription medication were also submitted to other health care benefit programs such as Blue Cross/Blue Shield and Caremark. Not only were the false and fraudulent claims submitted for prescription medications that were never dispensed but some of the claims were for prescription medications used to treat medical conditions that the “patients” never had, according to the indictment. In some cases, the doctors whose names were used on the prescriptions had never seen the “patients.” To cover up their fraudulent scheme and billings, the pair forged prescriptions, forged doctors’ signatures on prescriptions, forged patients’ signatures on logs that purportedly indicated that the patient had received medications and altered pharmacy records.

According to the indictment, Garza and Flores caused the Medicaid/Vendor Drug program to pay more than $461,951 for fraudulent claims for medications that never dispensed to patients. Humana is alleged to have paid Garza an excess of $78,711 for similar fraudulent claims. As a result of this fraudulent scheme, an excess of $540,663 was to paid to Sara’s Pharmacy from on or about Nov. 15, 2006, through on or about June 17, 2011.




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Saturday, November 19, 2011

Marion Beverly Metoyer Sentenced to 21 Months in Prison for Medicare Fraud Scheme Involving Claims of Hurricane Damage to Power Wheelchairs


Source- http://www.fbi.gov/houston/press-releases/2011/houston-patient-recruiter-sentenced-to-21-months-in-prison-for-medicare-fraud-scheme-involving-claims-of-hurricane-damage-to-power-wheelchairs

WASHINGTON—A patient recruiter for a Houston durable medical equipment (DME) company was sentenced today to 21 months in prison for her role in a health care fraud scheme involving power wheelchairs, announced the Department of Justice, FBI and the Department of Health and Human Services (HHS).

Marion Beverly Metoyer, 57, of Dayton, Texas, was sentenced by U.S. District Judge Gray Miller in the Southern District of Texas. Metoyer was convicted by a jury on May 26, 2011, of one count of conspiracy to commit health care fraud, three counts of health care fraud, one count of conspiracy to defraud the United States and to receive health care kickbacks and two counts of receiving kickbacks.

Three co-conspirators were also sentenced today: Johnny Lee Andrews, 59, of Houston; Monica Renee Perry, 44, of Abbeville, La.; and Melvin Barnes, 61, of Humble, Texas. Andrews and Perry were each sentenced to 15 months in prison and Barnes was sentenced to one year of probation. Andrews, Perry and Barnes pleaded guilty on Sept. 23, 2010, to one count of conspiracy to commit health care fraud.

According to court documents, Helen Etinfoh was the owner and operator of Luant & Odera Inc., a Houston-area DME company doing business as Tonni Medical Equipment & Supplies. Metoyer, Andrews, Perry and Barnes were patient recruiters for Luant and were paid kickbacks in exchange for providing the company with beneficiaries in whose names bills could be submitted to Medicare. In addition to recruiting patients, Barnes and Andrews were also delivery drivers for Luant. Etinfoh and other co-conspirators submitted false and fraudulent claims to Medicare for medically unnecessary DME, including power wheelchairs, wheelchair accessories and motorized scooters.

According to court documents, Luant billed Medicare under a special code that designated the power wheelchairs as replacements for wheelchairs lost during hurricanes that hit the Houston area in fall 2008, based on representations from Metoyer, Andrews, Perry and Barnes. In fact, the hurricanes did not damage the wheelchairs. Certain beneficiaries did not even have a power wheelchair before receiving the ones provided to them by Luant. Luant used the hurricane code because it allowed the company to submit claims to Medicare without a doctor’s order.

Metoyer, Andrews, Perry and Barnes visited the homes of beneficiaries in whose names claims were submitted to Medicare, and offered the beneficiaries free power wheelchairs in exchange for their Medicare information. The power wheelchairs were often billed to Medicare at more than $6,000 per chair. In total, Luant fraudulently billed Medicare approximately $3 million.

Etinfoh was convicted by a federal jury of health care fraud in April 2010, and was sentenced to 41 months in prison. Paula Whitfield, a patient recruiter for Luant, was also convicted by a federal jury in April 2010, and was sentenced to 21 months in prison.




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Thursday, November 17, 2011

Isabel Roque The President of Isa & Yami Inc., Pleads Guilty to Medicare Fraud and Kickback Scheme


Source- http://www.fbi.gov/miami/press-releases/2011/miami-area-patient-recruiter-pleads-guilty-to-fraud-and-kickback-scheme

WASHINGTON—The owner and president of a Miami-area transportation company pleaded guilty today for her role in a Medicare fraud kickback scheme that funneled patients through a fraudulent mental health company, American Therapeutic Corporation (ATC), announced the Department of Justice, FBI and Department of Health and Human Services (HHS).

Isabel Roque, 55, pleaded guilty before U.S. District Judge K. Michael Moore in Miami to one count of conspiracy to commit health care fraud. Roque was the president of Isa & Yami Inc., which purported to provide patient transportation services in Miami.

According to court documents, Roque agreed to provide Medicare beneficiaries to ATC for partial hospitalization program (PHP) services in exchange for kickbacks. A PHP is a form of intensive treatment for severe mental illness. ATC purported to operate PHPs in seven different locations throughout South Florida and Orlando. According to court documents, Roque provided Medicare beneficiaries to four of ATC’s locations, including facilities in Boca Raton, Broward, Homestead and Miami.

Roque admitted that she knew the beneficiaries whom she referred to ATC did not need PHP treatment. Roque also knew that ATC fraudulently billed the Medicare program for the PHP services provided to the beneficiaries she referred. Roque often coached her referrals on what to say to doctors and therapists at ATC so that they could receive purported PHP services. According to court documents, Roque also paid kickbacks to the beneficiaries whom she referred to ATC in exchange for those beneficiaries agreeing to attend ATC.

According to court filings, ATC’s owners and operators paid kickbacks to owners and operators of assisted living facilities and halfway houses and to patient brokers in exchange for delivering ineligible patients to ATC and its related company, the American Sleep Institute (ASI). In some cases, the patients received a portion of those kickbacks. Throughout the course of the ATC conspiracy, millions of dollars in kickbacks were paid in exchange for Medicare beneficiaries who did not qualify for PHP services. The ineligible beneficiaries attended treatment programs that were not legitimate so that ATC and ASI could bill Medicare more than $200 million in medically unnecessary services.

According to the plea agreement, Roque’s participation in the fraud resulted in more than $3.8 million in fraudulent billing to the Medicare program. At sentencing, Roque faces a maximum of 10 years in prison and a $250,000 fine.

ATC, its management company Medlink Professional Management Group Inc., and various owners, managers, doctors, therapists, patient brokers and marketers of ATC, Medlink and ASI, were charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed on Feb. 15, 2011. ATC, Medlink and nine of the individual defendants have pleaded guilty or have been convicted at trial. Other defendants are scheduled to begin trial on April 9, 2012, before U.S. District Judge Patricia A. Seitz.




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Tuesday, November 15, 2011

Former Houston Doctor Armando Chavez Sentenced to Federal Prison for Conspiracy to Commit Medicare Fraud and Mail Fraud


Source- http://www.fbi.gov/houston/press-releases/2011/former-houston-doctor-sentenced-to-federal-prison

HOUSTON—A former Houston physician has been sentenced to 70 months in prison following his convictions for conspiracy to commit mail fraud and mail fraud, United States Attorney Kenneth Magidson announced today.

Armando Chavez, 42, a former physician and owner of the Chavez Medical Group in East Houston, was sentenced this morning by U.S. District Judge David Hittner to 60 months for the conspiracy charge and to 70 months for each of the three mail fraud charges, all to run concurrently. Chavez was also ordered to pay $3,821,082 in restitution.

Chavez was charged by criminal information in April 2011 and later waived indictment and entered a plea of guilty to one count of conspiracy and three counts of mail fraud.

The charges stem from improper billing at the Chavez Medical Group between 2005 and 2007. Chavez billed for services he did not perform through a process of “unbundling” medical codes used on claims he filed to increase the amount he was paid by insurance companies. Following the initiation of the investigation, Chavez voluntarily surrendered his medical license to the Texas Board of Medicine.

According to the documents filed of record in the case, Chavez was board certified in internal medicine, licensed by the Texas Board of Medicine in 1997. He started his medical practice in family medicine and in 2005, began to perform endovenous laser ablation, a procedure used to repair varicose veins in the legs.

For purposes of billing, the medical insurance industry provides certain billing codes for the laser ablation procedure, which include a group of procedures billed under one code for the entire procedure. Chavez instructed his staff to “unbundle” or separate the codes for this procedure and to bill for individual steps in the procedure, resulting in greater reimbursement and payment for each patient. Additionally, Chavez submitted claims alleging he repaired all six veins for each patient, when in fact—in most cases—he repaired fewer than six veins. By alleging he repaired all six veins, Chavez alleged he performed six procedures over a period of six days, another aspect of the fraudulent billing which he used to justify the unbundling of codes and allowed him to be reimbursed at the highest possible rate.




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Sunday, November 13, 2011

Xpress Flex Inc. Owner Michael Wayne Davis, Indicted for Wire Fraud and Theft from a Health Care Benefit Plan


Source- http://www.fbi.gov/saltlakecity/press-releases/2011/xpress-flex-owner-indicted-for-wire-fraud-and-theft-from-a-health-care-benefit-plan

BOISE—Michael Wayne Davis, II, 45, of Raleigh, North Carolina, formerly of Eagle, Idaho, was indicted yesterday by a federal grand jury in Boise on eight counts of wire fraud and three counts of theft from a health care benefit plan, U.S. Attorney Wendy J. Olson announced.

According to the indictment, from 2002 until 2010, Davis owned and operated Xpress Flex, Inc. Xpress Flex was located in Boise, Idaho, and administered flexible benefits plans that allowed employees of Xpress Flex’s clients to pay for health care, dependent care, group insurance premiums, parking, and public transportation expenses with pre-tax withholdings from their paychecks. Through their employers, employees contributed funds to Xpress Flex and submitted claims to Xpress Flex for reimbursement after they incurred expenses. Xpress Flex was responsible for processing, adjudicating, and paying employees’ claims for reimbursement from these funds. In return for this service, the employers paid Xpress Flex an administrative fee.

According to the indictment, from 2009 to 2010, Davis devised a scheme to misappropriate the funds contributed by employers to Xpress Flex on behalf of their employees. Despite representations in Xpress Flex plan documents and agreements with employers that these funds belonged to the employers, and that Xpress Flex had no authority to dispose or invest them, Davis used these funds without authorization to pay for personal expenditures and the business expenses of another company he owned, Payroll America, Inc. The indictment alleges that these personal expenditures included concert tickets, meals at restaurants, gasoline, and merchandise from Amazon.com. The indictment also alleges that when Xpress Flex was late in paying reimbursement claims to Xpress Flex’s clients, or bounced reimbursement checks, employees of Xpress Flex made false statements to the clients, at Davis’ direction, about the causes of the delayed payments or bounced checks. The indictment alleges that after Xpress Flex’s operations ceased in March 2010, Davis continued to misappropriate client funds for his personal use and Payroll America’s purposes.

The indictment alleges thefts from the Independent School District of Boise City and Skagit County, Washington, flexible benefits plans and contains a forfeiture allegation seeking approximately $1,036,706, or substitute assets, including property, valued at this amount.

Each count of wire fraud is punishable by up to 20 years in prison, a maximum fine of $250,000 or twice the gain or loss from the offense, and up to three years of supervised release. Each count of theft from a health care benefit plan is punishable by up to 10 years in prison, a maximum fine of $250,000 or twice the gain or loss from the offense, and up to three years of supervised release.




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Wednesday, November 9, 2011

Miami-Area Patient Recruiter Beatriz Torres-Cruz Pleads Guilty in $25 Million Health Care Fraud Scheme


Source- http://www.fbi.gov/miami/press-releases/2011/miami-area-patient-recruiter-pleads-guilty-in-25-million-health-care-fraud-scheme?utm_campaign=email-Immediate&utm_medium=email&utm_source=miami-press-releases&utm_content=45323

WASHINGTON—A patient recruiter of a Miami health care agency pleaded guilty yesterday for her participation in a $25 million home health Medicare fraud scheme, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

Beatriz Torres-Cruz, 50, pleaded guilty before U.S. District Judge Joan A. Lenard in Miami to one count of conspiracy to commit health care fraud and one count of solicitation of health care kickbacks. Torres-Cruz was charged in a February 2011 indictment. According to plea documents, Torres-Cruz was a patient recruiter for Florida Home Health Providers Inc., a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries. According to court documents, Florida Home Health billed the Medicare program for expensive physical therapy and home health care services that were medically unnecessary and/or never provided. Court documents allege that the medically unnecessary services were prescribed by doctors, including Jose Nunez, M.D. Nunez was also charged in the February 2011 indictment along with Torres-Cruz and 19 other co-conspirators.

Torres-Cruz admitted that, beginning in approximately January 2006 and continuing until approximately March 2009, she, along with co-defendants, offered and paid kickbacks and bribes to Medicare beneficiaries in return for those beneficiaries allowing Florida Home Health to bill Medicare for services that were medically unnecessary and/or never provided. Torres-Cruz solicited and received kickbacks and bribes from the owners and operators of Florida Home Health in return for her patient recruiting. Torres-Cruz knew that the patients she recruited for Florida Home Health did not qualify for the services billed to Medicare.

As a result of Torres-Cruz’s participation in the illegal scheme, Medicare was billed approximately $195,000 for purported home health care services that were not medically necessary and/or were not rendered.

Seventeen other co-conspirators have pleaded guilty for their roles in the fraud scheme, including Dr. Nunez.

Sentencing has been scheduled for Jan. 30, 2012.

The charge of conspiracy to commit health care fraud carries a maximum prison sentence of 10 years and the charge of solicitation of health care kickbacks carries a maximum prison sentence of five years. The defendant also face fines and terms of supervised release, as well as forfeiture of any property or proceeds derived from her criminal activities.




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Monday, November 7, 2011

Rochester Chiropractor Christopher Fronczak Sentenced for Health Care Fraud


Source- http://www.fbi.gov/buffalo/press-releases/2011/rochester-chiropractor-sentenced-for-health-care-fraud

ROCHESTER, NY—U.S. Attorney William J. Hochul, Jr. announced today that Christopher Fronczak, 37, of Victor, N.Y., who was convicted of health care fraud, was sentenced to five years’ probation by U.S. District Court Judge Charles J. Siragusa. Judge Siragusa also ordered Fronczak to pay $199,999 in restitution to Excellus BlueCross BlueShield (“Excellus”).

Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated that during the years 2005 and 2010, the defendant, while a Doctor of Chiropractic Medicine, executed a scheme to defraud Excellus BlueCross BlueShield (“Excellus”), a health care benefit program, by submitting reimbursement claims for services he did not perform.

Part of the scheme to defraud involved chiropractic services the defendant provided to college football players and other athletes at St. John Fisher College. While the defendant provided treatments known as adjustments to the athletes at the college after practices, which took appropriately five minutes for each, Fronczak submitted insurance claims to Excellus for more expensive treatments which were not provided, including spinal manipulation, electrical stimulation, mechanical traction, manual therapy techniques, and an office visit. The fraudulent insurance claims submitted to Excellus for the football players were virtually identical for each player.

In another case, a 45-year-old patient was treated for shoulder pain once or twice a month. This patient never received mechanical traction and most visits would lasted approximately 10 minutes. Despite this, Fronczak submitted claims for numerous visits which never took place and for services which were never rendered, including application of hot and cold packs, mechanical traction, electrical stimulation, manual therapy techniques, and spinal manipulation.

During the years 2005 through 2009, the defendant was also hired by the Crossman Corporation as an independent contractor to provide Chiropractic services to their employees. The Crossman Corporation paid the defendant approximately $67,000 for the chiropractic services provided by the defendant to the employees. The defendant billed the employees’ insurance companies as well.




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Saturday, November 5, 2011

Zafar Mehmood Arrested in Connection with $30 Million Medicare Home Health Scheme


Source- http://www.fbi.gov/detroit/press-releases/2011/detroit-area-man-arrested-in-connection-with-30-million-medicare-home-health-scheme?utm_campaign=email-Immediate&utm_medium=email&utm_source=detroit-press-releases&utm_content=43737

WASHINGTON—A Detroit-area resident was charged and arrested today in the Eastern District of Michigan for his alleged leading role in a $30 million Medicare fraud scheme involving home health services, announced the Department of Justice, the Department of Health and Human Services (HHS), the FBI and the HHS-Office of Inspector General (OIG). In addition to the arrest, law enforcement agents executed search warrants at five locations, seizure warrants for 31 bank accounts related to the scheme and suspended Medicare payments to 16 health care companies associated with the scheme.

According to a criminal complaint unsealed today in U.S. District Court in Detroit, Zafar Mehmood, 45, allegedly masterminded a $30 million scheme involving the submission of fraudulent claims submitted to Medicare for services that were medically unnecessary and/or never provided through at least four home health agencies. The four home health agencies named in the complaint are Access Care Home Care Inc. and Patient Care Home Care Inc., in Ypsilanti, Mich., and Hands On Healing Home Care Inc. and All State Home Care Inc., in Detroit.

Mehmood is alleged to have paid kickbacks to patient recruiters and billed Medicare for services that were not medically necessary and/or not performed through Access, Patient Care, Hands On Healing and All State. Mehmood is also accused of laundering the proceeds of the scheme through sham companies and intermediaries.

Mehmood is scheduled to make his initial appearance today before U.S. Magistrate Judge Mona K. Majzoub.




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Friday, November 4, 2011

Former “Most Wanted” Health Care Fraud Fugitives Sentenced to 14 Years in Prison for $9.1 Million Detroit Medicare Fraud Scheme


Source- http://www.justice.gov/opa/pr/2011/November/11-crm-1450.html

WASHINGTON – Two sisters who owned a fraudulent Detroit-area medical clinic and who are former “Most Wanted” health care fraud fugitives were each sentenced in Miami today to 14 years in prison for their leading roles in a $9.1 million Medicare fraud scheme, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

Caridad Guilarte, 54, and Clara Guilarte, 57, were sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. The Guilartes were also sentenced to three years of supervised release and were ordered to pay approximately $6 million in restitution, jointly with co-defendants.

The Guilartes pleaded guilty on Aug. 24, 2011, to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering. The sisters were charged in an indictment unsealed in June 2009 in the Eastern District of Michigan. After fleeing the United States to Panama and then Venezuela to avoid arrest, they were placed on the HHS-Office of Inspector General (HHS-OIG) Most Wanted Fugitives list. They were arrested on March 13, 2011, by law enforcement authorities in Colombia and were returned to the United States on March 14, 2011. The Guilartes consented to have their cases transferred to the Southern District of Florida for plea and sentencing. As part of her plea, Caridad Guilarte agreed to forfeit approximately $465,000, which was seized by the FBI as part of its investigation.

According to court documents, the Guilartes opened Dearborn Medical Rehabilitation Center (DMRC) in November 2005 solely for the purpose of defrauding Medicare. DMRC purported to be an infusion clinic that administered infusions of exotic and expensive medications to patients suffering serious illnesses, such as HIV and Hepatitis-C. Between November 2005 and March 2007, DMRC submitted more than $9 million in claims to Medicare for infusion treatments and related services.

The Guilartes admitted that they purchased only a small fraction of the medications billed to Medicare. The Medicare beneficiaries who visited DMRC did not need infusion treatments, but instead came to DMRC because they were bribed to do so with the payment of cash kickbacks. The Guilartes recruited a number of individuals to assist them in defrauding Medicare, including beneficiary recruiters, who paid cash kickbacks, and a doctor, to give the clinic an appearance of legitimacy.

Medicare paid in excess of $6 million to DMRC. The Guilartes laundered the proceeds of the fraud through various co-conspirators and a series of shell corporations, which had no legitimate business function. More than 10 individuals have pleaded guilty to health care fraud and/or money laundering in connection with the DMRC scheme.




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Thursday, November 3, 2011

Brooklyn, N.Y., Medicare Fraud Strike Force Charges 12 Individuals for Participating in Health Care Fraud Schemes Totaling More Than $95 Million


Source- http://www.justice.gov/opa/pr/2011/November/11-crm-1440.html

WASHINGTON – Twelve individuals, including three medical doctors, a doctor of osteopathy and a chiropractor, were charged today in the Eastern District of New York for their roles in separate health care fraud schemes that resulted in the submission of more than $95 million in false claims to the Medicare program, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

The defendants are charged with a variety of health care fraud-related and money laundering offenses in two indictments and a superseding indictment filed in federal court in Brooklyn, N.Y. Eleven defendants were arrested or surrendered to authorities today. The last defendant is expected to surrender at a later time.

“Today 12 individuals – including three medical doctors and other licensed health professionals – were charged with participating in sophisticated Medicare fraud and money laundering schemes throughout Brooklyn and Queens ,” said Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division. “According to court documents, these defendants sought to profit by stealing millions of taxpayer dollars from the Medicare program and laundering the proceeds of this illegal activity. The Medicare Fraud Strike Force, which operates in nine cities across the country, will continue to aggressively pursue those intent on cheating American taxpayers and stealing from the Medicare program.”

“These defendants allegedly invested significant time and energy in subterfuge to conceal their ill gotten government funds. Money laundering is a critical part of large scale health care fraud schemes and often the most difficult piece to unravel. Law enforcement will not be deterred by the schemes and evasions used to hide these proceeds of fraud. We will ‘follow the money’ and bring to justice all who would engage in financial transactions designed to disguise the proceeds of Medicare fraud,” stated Loretta E. Lynch, U.S. Attorney for the Eastern District of New York. Ms. Lynch expressed her grateful appreciation to the FBI and HHS-OIG, the agencies responsible for leading the government’s investigation, and thanked the New York State Attorney General’s Office for its assistance.

“What all these criminal schemes have in common is the exploitation of Medicare,” said FBI Assistant Director in Charge Janice K. Fedarcyk. “A program to help seniors manage the costs of health care was here abused to line the pockets of unscrupulous doctors and others. Medicare and Medicaid are taxpayer funded, so the outrageous conduct of these defendants victimized everyone. The FBI is committed to policing health care fraud, to catch the crooks and to rein in costs.”

“Physical therapy fraud and illegal financial kickbacks remain a problem in the Brooklyn area,” said Thomas O’Donnell, Special Agent in Charge of the HHS-Office of Inspector General’s (OIG) New York Region. “So, along with federal and state law enforcement partners, we will target these and similar schemes that divert valuable, scarce Medicare funds.”

According to a superseding indictment, five defendants are charged for their roles in a scheme to launder the proceeds of Medicare fraud at three Brooklyn-area medical clinics: Bay Medical Care PC, SVS Wellcare Medical PLLC and SZS Medical Care PLLC. These clinics allegedly paid kickbacks to Medicare beneficiaries and used the beneficiaries’ names to bill Medicare for approximately $71 million in services that were medically unnecessary and never provided. Larisa Shelabadova, 34, Alexander Zaretser, 31, Anatoly Kraiter, 33, Vladimir Kornev, 52, and Yelena Galper, 38, all of Brooklyn, are charged for participating in the money laundering scheme. The superseding indictment also charges five other individuals who were previously charged for their roles in the scheme in the original indictment filed in October 2010.

A second indictment alleges that six defendants, including three medical doctors and a chiropractor, participated in a fraud scheme at URI Medical Center and Sarang Medical PC, two medical clinics in Flushing, N.Y. The defendants allegedly submitted approximately $11.7 million in false claims to the Medicare program for physical therapy, electric stimulation treatments and other services. Ho Yon Kim, 85, of Flushing; Hoi Yat Kam, 57, of Flushing; Peter Lu, 36, of New York City; John Knox, 54, of Bronx, N.Y.; Elaine Kim, 50, of Bayside, N.Y.; and Gilbert Kim, 59, of Bayside, allegedly provided a variety of spa services such as massages and facials, and billed Medicare for physical therapy and other services that were medically unnecessary and never provided. The indictment alleges that the defendants also recruited Medicare beneficiaries to their clinic by offering lunches and dancing classes, in exchange for the beneficiaries providing their Medicare numbers to be billed for medical services that they did not need and never received.

Emma Poroger, 56, of Staten Island, N.Y., is charged in a third indictment for participating in a scheme to defraud Medicare of approximately $13 million. Poroger, a doctor of osteopathy, allegedly billed Medicare for a variety of services she purported to provide, including vitamin infusion therapy, sleep studies, nerve conduction tests and duplex scans, that were medically unnecessary and never provided.




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