Source- http://www.justice.gov/opa/pr/2012/September/12-civ-1133.html
HCA Inc., one of the nation’s largest for-profit hospital chains, has agreed to pay the United States and the state of Tennessee $16.5 million to settle claims that it violated the False Claims Act and the Stark Statute, the Department of Justice announced today.
As alleged in the settlement agreement, during 2007, HCA, through its subsidiaries Parkridge Medical Center, located in Chattanooga, Tenn., and HCA Physician Services (HCAPS), headquartered in Nashville, Tenn., entered into a series of financial transactions with a physician group, Diagnostic Associates of Chattanooga, through which it provided financial benefits intended to induce the physician members of Diagnostic to refer patients to HCA facilities. These financial transactions included rental payments for office space leased from Diagnostic at a rate well in excess of fair market value in order to assist Diagnostic members to meet their mortgage obligations and a release of Diagnostic members from a separate lease obligation.
The Stark Statute restricts financial relationships that hospitals may enter into with physicians who potentially may refer patients to them. Federal law prohibits the payment of medical claims that result from such prohibited relationships.
“The Department of Justice continues to pursue cases involving improper financial relationships between health care providers and their referral sources, because such relationships can corrupt a physician’s judgment about the patient’s true healthcare needs,” said Stuart F. Delery, the Acting Assistant Attorney General for the Department of Justice’s Civil Division.
“Physicians should make decisions regarding referrals to health care facilities based on what is in the best interest of patients without being induced by payments from hospitals competing for their business,” said Bill Killian, U.S. Attorney for the Eastern District of Tennessee.
“ Improper business deals between hospitals and physicians jeopardize both patient care and federal program dollars,” said Daniel R. Levinson, Inspector General of the Department of Health and Human Services. “Our investigators continue to work shoulder to shoulder with other law enforcement authorities to stop schemes that imperil scarce health care resources.”
The civil settlement resolves a lawsuit, United States ex rel. Bingham v. HCA, No. 1:08-CV-71 (E.D. Tenn.), pending in federal court in the Eastern District of Tennessee under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the United States and share in any recovery. As part of the civil settlement, HCA has agreed to pay $16.5 million to the United States and the state of Tennessee, with the federal portion representing $15,693,000 of the settlement amount. The whistleblower will receive an 18.5 percent share.
Also as part of the settlement, Parkridge Medical Center has entered into a comprehensive five-year Corporate Integrity Agreement with the Office of Inspector General of the U.S. Department of Health and Human Services to ensure its continued compliance with federal health care benefit program requirements.
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $9.4 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13.1 billion.
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Source- http://www.fbi.gov/losangeles/press-releases/2012/los-angeles-physician-assistant-sentenced-to-72-months-in-prison-for-role-in-18.9-million-medicare-fraud-scheme
WASHINGTON—A Los Angeles physician assistant who stole the identities of doctors to write medically unnecessary prescriptions for expensive durable medical equipment (DME) and diagnostic tests was sentenced today to serve 72 months in prison in connection with a $18.9 million Medicare fraud scheme, announced the Department of Justice, FBI and U.S. Department Health and Human Services (HHS).
David James Garrison, 50, was sentenced by U.S. District Judge Consuelo B. Marshall in the Central District of California. In addition to his prison term, Garrison was sentenced to three years of supervised release and ordered to pay $24,935 in restitution, jointly and severally with convicted co-defendants.
In June 2012, after a two-week trial, a federal jury found Garrison guilty of one count of conspiracy to commit health care fraud, six counts of health care fraud, and one count of aggravated identity theft. The trial evidence showed that Garrison worked at fraudulent medical clinics that operated as prescriptions mills and trafficked in fraudulent prescriptions and orders for medically unnecessary DME and diagnostic tests that were used by fraudulent DME supply companies and medical testing facilities to defraud Medicare. Garrison wrote the prescriptions and ordered the tests on behalf of doctors whom he never met and who did not authorize him to write prescriptions and order tests on their behalf.
The trial evidence showed that between March 2007 and September 2008, Garrison’s co-conspirator Edward Aslanyan and others owned and operated several Los Angeles medical clinics established for the sole purpose of defrauding Medicare. Aslanyan and others hired street-level patient recruiters to find Medicare beneficiaries willing to provide the recruiters with their Medicare billing information in exchange for expensive, high-end power wheelchairs and other DME, which the patient recruiters told the beneficiaries they would receive for free. Often, the solicited Medicare beneficiaries did not have a legitimate medical need for the power wheelchairs and equipment. The patient recruiters then provided the beneficiaries’ Medicare billing information to Aslanyan and others or brought the beneficiaries to the fraudulent medical clinics. In exchange for recruiting the Medicare beneficiaries, Aslanyan and others paid the recruiters a cash kickback for every beneficiary they recruited.
The evidence presented at trial showed that Garrison wrote prescriptions for power wheelchairs, which the beneficiaries did not need and did not use. In some cases, Garrison wrote power wheelchair prescriptions for beneficiaries he never examined and who never visited the clinics. Once Garrison wrote the power wheelchair prescriptions, Aslanyan and others sold them from $1,000 to $1,500 to the owners and operators of approximately 50 different fraudulent DME supply companies, which used the prescriptions to submit fraudulent power wheelchair claims to Medicare. The DME supply companies purchased the power wheelchairs wholesale for approximately $900 per wheelchair but billed the wheelchairs to Medicare at a rate of approximately $5,000 per wheelchair. Aslanyan also used the prescriptions Garrison wrote at two fraudulent DME supply companies that Aslanyan owned and operated.
In addition, the trial evidence showed that Garrison ordered the same medically unnecessary diagnostic tests for every Medicare beneficiary, including tests for sleep studies, ultrasounds and nerve conduction. These tests were then billed to Medicare by fraudulent diagnostic testing companies that paid Aslanyan kickbacks to operate from the medical clinics.
The trial evidence showed that Garrison admitted to writing prescriptions for power wheelchairs and ordered diagnostic tests on behalf of approximately six different doctors, many of whom never met Garrison and never had a delegation of services agreement with him, as required by law. The trial evidence also showed that Garrison was paid up to $10,000 a week in cash for his work at the clinics.
As a result of this fraud scheme, Garrison and his co-conspirators submitted over $18.9 million in false claims to Medicare and received $10.7 million on those claims.
Currently, Garrison is facing federal drug charges as a result of his alleged involvement with another medical clinic where medically unnecessary prescriptions for Oxycontin were distributed. Garrison is scheduled for trial on the federal drug charges on November 6, 2012. He is presumed innocent of the charges against him.
Aslanyan pleaded guilty for his role in the scheme in April 2011 and was sentenced on February 6, 2012, to 77 months in prison. Carolyn Vasquez, another co-conspirator, pleaded guilty for her role in the scheme in March 2011 and was sentenced on January 9, 2012, to 60 months in prison.
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Source- http://www.fbi.gov/detroit/press-releases/2012/plymouth-doctor-indicted-on-charges-of-illegal-drug-distribution-and-medicare-fraud
An indictment was unsealed today charging Dr. Mikhayl Soliman, 59, of Plymouth, Michigan, with Medicare fraud and distribution of prescription drugs, United States Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by the Special Agent in Charge Robert Corso, Drug Enforcement Administration, Detroit Division; Special Agent in Charge, Robert D. Foley, III, Federal Bureau of Investigation; Special Agent in Charge Lamont Pugh, Health and Human Services, Office of Inspector General; and Police Chief Jason Wright, City of Wayne, Michigan.
The 10-count indictment charges that between 2007 and 2012, Dr. Soliman billed Medicare for services not rendered and distributed controlled substances outside the course of usual medical practice and for no legitimate purpose. During that time frame, Dr. Soliman billed Medicare for approximately $4,155,565 in claims. The majority of the claims were for physician home visits that were purportedly provided when Dr. Soliman was not present in the home, as required by Medicare. Dr. Soliman is also charged with providing prescriptions for OxyContin, Vicodin, and other pharmaceutical narcotics in exchange for cash payments outside the course of usual medical practice and for no legitimate purpose.
“Medicare is intended to provide health care funds for our most vulnerable citizens,” U.S. Attorney McQuade said. “Doctors and other providers who steal taxpayer money by cheating the Medicare program will be prosecuted.”
Robert Corso, DEA Special Agent in Charge said, “Today’s arrest is another example of DEA’s determination to combat the troubling prescription drug abuse problem in this country. Dr. Soliman abused his position of trust and jeopardized the lives of many individuals by illegally distributing highly addictive opiate painkillers. Today’s arrest of Dr. Soliman makes it clear that the DEA and our partners in law enforcement will continue to investigate and bring to justice those individuals that are responsible for the illegal distribution of prescription medicines.”
Robert D. Foley, III, FBI Special Agent in Charge said, “These charges represent a serious abuse of the health care system. Those motivated by greed who unlawfully take from a system designed to care for patients, will be tirelessly pursued by the FBI and prosecuted for their crimes.”
“Today’s arrest sends a clear message that the unlawful distribution of controlled substances and the fraudulent billing of Medicare will not be tolerated” said Lamont Pugh III, Special Agent in Charge of the Chicago Region for the U.S. Department of Health and Human Services, Office of Inspector General. “The OIG, working with our federal, state, and local partners, will continue to fight to protect the safety of patients and taxpayer dollars.”
Soliman was arrested today and appeared in federal court this afternoon for his arraignment.
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Source- http://www.fbi.gov/dallas/press-releases/2012/federal-grand-jury-indicts-owners-operators-of-hyperbaric-oxygen-therapy-companies-in-health-care-fraud-conspiracy
DALLAS—Stanley Thaw, 70, and his wife, Kernell Thaw, 49, both of Frisco, Texas, and Michael Kincaid, 55, of Plano, Texas, have been charged in an indictment, unsealed late yesterday, on charges including conspiracy, health care fraud, making false statements to a financial institution, and engaging in illegal monetary transactions with fraud proceeds, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas. They are expected to make their initial appearances this afternoon in federal court in Dallas, before U.S. Magistrate Judge Paul D. Stickney.
Stanley and Kernell Shaw and Michael Kincaid owned various hyperbaric oxygen therapy (HBOT) companies in North Texas, Houston, and San Antonio, Texas. The HBOT entities employed physicians to supervise the provision of HBOT to federal health care program and private-pay patients. The indictment alleges that from January 2008 to June 2011, Stanley Thaw and Michael Kincaid engaged in a scheme to defraud Medicare by double-billing for the physician supervision and attendance of HBOT-related services.
The false statements charges involve properties in Frisco and Dallas, Texas that Stanley and Kernell Thaw purchased from a local home builder. The indictment alleges that the Thaws made material false statements to a financial institution to obtain a $1.3 million residential loan. The indictment contends had the financial institution known the Thaws’ representations were false, it would have rejected their loan.
The indictment specifically charges Stanley Thaw and Michael Kincaid each with one count of conspiracy to commit health care fraud and five substantive counts of health care fraud. Stanley and Kernell Thaw each are charged with three counts of making false statements to a financial institution. Each of the three defendants is charged with one count of money laundering.
An indictment is an accusation by a federal grand jury, and a defendant is entitled to the presumption of innocence unless proven guilty. If convicted, however, the conspiracy count and each of the health care fraud counts carries a maximum statutory sentence of 10 years in prison and a $250,000 fine. Upon conviction, each of the false statements counts carries a maximum statutory sentence of 30 years in prison and a $1 million fine. Upon conviction, each of the money laundering counts can result in up to 10 years in prison and a $250,000 fine. The indictment also includes a forfeiture allegation, which would require Stanley Thaw and Michael Kincaid to forfeit all proceeds traceable to their offenses and the more than $32,000 that was seized from an account at a local bank.
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Source- http://www.justice.gov/opa/pr/2012/September/12-crm-1117.html
WASHINGTON – Four individuals were charged in court documents unsealed today in the Eastern District of Michigan for their participation in a 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 (HHS-OIG).
According to court documents unsealed today in U.S. District Court in Detroit, the scheme allegedly involved a total of more than $1.6 million in fraudulent claims submitted to Medicare for home health care services that were medically unnecessary and/or never provided. All four defendants were arrested this morning. In addition, law enforcement agents today executed search warrants at two locations and seizure warrants for 16 bank accounts related to the alleged fraud schemes.
Four individuals are charged in one indictment including one physician, two clinic owners and one nurse. According to court documents, the conspiracy was allegedly operated out of Angle’s Touch Home Health Care LLC, a home health agency in Taylor, Mich.
Defendants charged include: Dr. Sonjai Poonpanij, 77, of Rochester, Mich.; clinic owners Attaullah Arain, 45, of Brownstown, Mich., and Nadia Arain, 39, of Brownstown; and registered nurse Judith Ragasa, 49, of Windsor, Ontario, Canada.
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Source- http://www.fbi.gov/charlotte/press-releases/2012/shelby-woman-pleads-guilty-to-defrauding-medicaid-of-6.1-million
CHARLOTTE, NC—A Shelby woman pleaded guilty in U.S. District Court today for her involvement in a health care fraud scheme that defrauded Medicaid of at least $6.1 million for sham mental and behavioral health services, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
U.S. Attorney Tompkins is joined in making today’s announcement by Attorney General Roy Cooper, who oversees the North Carolina Medicaid Investigations Division (MID); Chris Briese, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; Jeannine A. Hammett, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation (IRS-CI); and Derrick Jackson, Special Agent in Charge, Department of Health and Human Services, Office of the Inspector General (HHS-OIG), Office of Investigations, Atlanta Region.
Linda Smoot Radeker, 61, of Shelby, North Carolina, pleaded guilty today before U.S. Magistrate Judge David S. Cayer to one count of health care fraud conspiracy and two counts of money laundering. At today’s plea hearing, Radeker admitted that from 2008 to 2011 she obtained at least $6.1 million in fraudulent reimbursement payments from false claims submitted to Medicaid. According to filed court documents and statements made in court, Radeker, a licensed professional counselor enrolled with North Carolina Medicaid, claimed in the fraudulent Medicaid billings that she was the attending clinician for these provided services, when, in fact, she provided no services to the claimed beneficiaries. Court records indicate that Radeker oversaw a network of co-conspirators, operating in Gaston and Cleveland Counties and elsewhere, who billed for false and fraudulent claims through Radeker’s provider number. In exchange for her willingness to “rent out” her Medicaid provider number, Radeker kept a percentage of the Medicaid reimbursements, sometimes as much as 50 percent.
Filed documents also indicate that the claimed Medicaid beneficiaries primarily were children recruited from the community, whose parents thought they were enrolling in after school programs owned and operated by Radeker’s co-conspirators and located in Shelby, Kings Mountain, and Bessemer City, North Carolina. Through those programs, Radeker and her co-conspirators obtained the children’s Medicaid information which they used to file the fraudulent claims.
According to court documents, Radeker made several large purchases using criminal proceeds including $21,500 to purchase a 2010 Ford Ranger and $44,440 to purchase a 2010 Lincoln MKS SUV. Radeker also used Medicaid money to purchase a recreational vehicle (RV) and at least $500,000 in jewelry.
In announcing today’s guilty plea, U.S. Attorney Tompkins said, “Radeker’s criminal conduct is an assault on health care resources meant to cover the needs of the poor, the sick and the elderly. In 2010, we formed the Western District of North Carolina Health Care Fraud Task Force to target criminals and illegal schemes like Radeker’s. I am proud of the work of the task force and the continued commitment of our federal, state, and local partners in identifying and prosecuting those who compromise the integrity of a health care system that provides much needed services to vulnerable North Carolinians.”
North Carolina Attorney General Roy Cooper stated, “Medicaid cheaters waste taxpayer money and drive up medical costs for everyone. We’ll continue our strong partnership with federal law enforcement to root out fraud and abuse in our health care system.”
“Radeker’s scheme targeted some of the most vulnerable families in North Carolina. She betrayed parents dependent on Medicaid for their children’s care. Health care fraud not only poses a potential risk to patients, it increases costs for everyone,” said FBI Special Agent in Charge Chris Briese.
IRS-CI Special Agent in Charge Hammett stated, “The abuse and misuse of Medicaid Programs impacts each of us as taxpayers and citizens. IRS-CI will continue to work jointly with the United States Attorney’s Office and other law enforcement agencies to ferret out those who might consider Medicaid fraud as a way to make easy money.”
At sentencing, Radeker faces a maximum term of 10 years in prison and a $250,000 fine for the health care fraud conspiracy charge, and a maximum term of 10 years in prison and a $250,000 fine or twice the value of the transaction for each count of money laundering. In her plea agreement, Radeker has agreed to pay full restitution to Medicaid for any losses resulting from her criminal scheme. The final restitution amount will be determined by the court at Radeker’s sentencing hearing, which has not been scheduled yet.
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Source- http://www.justice.gov/usao/cac/Pressroom/2012/122a.html
LOS ANGELES – A doctor already serving a lengthy prison sentence in a narcotics case has been convicted of health care fraud for submitting approximately $1 million in fraudulent bills to Medicare in just seven months.
After less than a day of deliberations, a federal jury on Monday afternoon convicted Dr. Owusu Ananeh Firempong of five counts of health care fraud.
Firempong, 61, who resided in the Crenshaw district of Los Angeles and had been practicing in the Los Angeles region for more than three decades, submitted fraudulent bills for nerve conduction tests and sleep studies that were never performed. As a result of the fraudulent bills, Medicare paid him nearly $700,000.
During a four-day trial in United States District Court, prosecutors presented evidence that Firempong obtained information about Medicare beneficiaries who were not his patients and then used that information to bill Medicare.
The evidence presented at trial showed that Firempong repeatedly lied to Medicare about services he claimed to have provided at clinic locations from which he had been evicted. The jury also heard expert testimony from a neurologist about Firempong’s patient files, which contained so many internal inconsistencies and improbably identical results that they appeared to have been a “copy-and-paste job.”
As a result of this week’s guilty verdicts, Firempong faces up to 50 years in federal prison. Firempong is scheduled to be sentenced by United States District Judge Gary A. Feess on December 10.
“Taxpayers expect that Medicare services they pay for are both necessary and provided by the proper health provider,” said Glenn R. Ferry, the Los Angeles Region’s Special Agent in Charge for the Office of Inspector General of the Department of Health and Human Services. “Such billing based on improper Medicare provider numbers will continue to be aggressively investigated and prosecuted.”
Firempong is currently in custody after being sentenced in Michigan last year to 324 months in federal prison in an unrelated cocaine trafficking and money laundering case. That case is currently on appeal.
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Source- http://www.justice.gov/usao/txs/1News/Releases/2012%20September/120912%20Lopez.html
McALLEN, Texas - An Edinburg, Texas, resident has been sentenced to 33 months in federal custody in connection with a mail fraud scheme she developed in the McAllen area, United States Attorney Kenneth Magidson announced today. San Juana Aidee Lopez, 60, pleaded guilty June 29, 2102, to two counts of mail fraud in connection with her employment as an insurance agent.
At the time of her guilty plea, she admitted that she created a scheme to defraud victims when she approached them about purchasing insurance with for health care policies and for funeral and burial insurance policies. She was paid commissions immediately based on the number of new policies she sold.
The scheme was elaborate with many facets, but the most common thread was that she took personal identification information from existing policyholders and signed them up for certain policies they did not authorize. Since she was paid immediately for all new policies she sold, it was to her benefit to create as many new policy sales as she could. She created bogus and fraudulent policies without the knowledge of the person whose name she used. She also placed payment for the policies on automatic electronic bank draft by using the accounts of other policyholders who already had an existing policy. When the unsuspecting victim whose bank account was drafted called to complain, she told them it was an administrative error. This helped Lopez to accomplish and further the scheme because as long as two successive payments were made on the new policy, any adjustments for refunds were not taken from her commissions but were paid from a reserve account. This scheme resulted in harm to more than 20 victims who suffered an aggregate loss of more than $49,000.
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Source- http://www.justice.gov/opa/pr/2012/September/12-crm-1097.html
WASHINGTON – A patient recruiter for several Louisiana durable medical equipment (DME) companies was sentenced today to serve 18 months in prison for her role in a Medicare fraud scheme involving fraudulent claims and illegal kickback payments for unnecessary DME, announced the Department of Justice, the Department of Health and Human Services (HHS), the FBI and the Louisiana State Attorney General's Office.
Karen T. Rayburn, 47, was sentenced today by U.S. District Judge James J. Brady of the Middle District of Louisiana. In addition to her prison term, Rayburn was sentenced to two years of supervised release and ordered to pay $3.18 million in restitution.
Rayburn pleaded guilty on Jan. 19, 2012, to one count of conspiracy to commit health care fraud.
According to court documents, Rayburn worked as a recruiter for Healthcare 1 LLC, Medical 1 Patient Services LLC and Lifeline Healthcare Services Inc., Louisiana-based companies that fraudulently billed medical equipment to the Medicare program from 2004 to 2009. She and other recruiters were hired to obtain prescriptions for medical equipment such as leg braces, arm braces, power wheel chairs and wheel chair accessories. Rayburn obtained information from Medicare beneficiaries as well as falsified prescriptions for medical equipment. These prescriptions were then used to submit fraudulent claims to the Medicare program.
According to court documents, from 2004 to 2009, the companies involved in these schemes submitted more than $21 million in fraudulent claims to Medicare, and as a result of the prescriptions that Rayburn collected the companies submitted more than $6 million in fraudulent claims.
Eight other defendants have been sentenced for their roles in this scheme, and three additional defendants await sentencing.
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Source- http://www.justice.gov/usao/ct/Press2012/20120906.html
David B. Fein, United States Attorney for the District of Connecticut, announced that DANIEL FIORE, 60, of Brooklyn, Conn., was sentenced today by Senior United States District Judge Ellen Bree Burns in New Haven to two years of probation and a fine of $20,000 for unlawfully dispensing controlled substances. FIORE must serve the first six months of his probation in home confinement under electronic monitoring by the United States Probation Office.
According to court documents and statements made in court, FIORE owned and operated Daniel’s Pharmacy, a retail pharmacy located at 42 Reynolds Street in Danielson. In 2009 and 2010, FIORE unlawfully dispensed a Schedule III controlled substance containing a mixture of hydrocodone and acetaminophen (generic Vicodin) and Schedule IV controlled substances, including diazepam (Valium), alprazolam (Xanax), or triazolam (Halcion), to friends and family members without any valid prescriptions for such medications. In order to conceal his conduct, FIORE created fraudulent prescriptions in his own handwriting as if the prescriptions had been called in by a physician’s office, and then documented filling the prescriptions in the same manner that he documented legitimate prescriptions. In total, FIORE unlawfully dispensed 1,542 tablets of Schedule III and 210 tablets of Schedule IV controlled substances.
After his arrest in January 2011, FIORE agreed to surrender his federal and state licenses to dispense controlled substances.
On April 18, 2012, FIORE waived his right to indictment and pleaded guilty to one count of unlawfully dispensing controlled substances.
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Source- http://www.justice.gov/usao/ma/news/2012/July/CobbMichaelSentencingPR.html
Michael Cobb, 42, was sentenced by U.S. District Judge George A. O’Toole to one year incarceration (six months in prison, six months home confinement), to be followed by two years of supervised release and a $3,000 fine. Cobb was also ordered to forfeit $10,000 of proceeds from the offense to the federal government. Cobb pleaded guilty to violating the Anti-Kickback law on April 19, 2012.
Between 2004 and 2011, Cobb, a physician’s assistant, took kickbacks from Orthofix Inc., a medical device company, in return for ordering Orthofix’s device. Orthofix manufactures bone growth stimulators, which are externally-worn medical devices that emit electromagnetic waves that help regenerate bone cells. Cobb was a physician’s assistant for a neurosurgeon in Rhode Island who prescribed bone growth stimulators for patients who underwent spinal fusion surgery. The surgeon had no preference as to which company’s bone growth stimulator was used, believing that there were no clinical differences amongst the stimulators on the market. The surgeon left this decision to Cobb, who was in a position to direct the stimulator business to whichever medical device company he chose. Between 2004 and 2011, Orthofix paid Cobb for each bone growth stimulator that was ordered by the surgeon in payments ranging from $50 to $300. Cobb never disclosed to the surgeon that he was taking these payments, and the surgeon would not have authorized the arrangement. Cobb was paid approximately $120,000 between 2004 and 2011 for bone growth stimulator orders. In return, Cobb steered more than a $1 million of reimbursement from insurance carriers to Orthofix, including approximately $350,000 in payments from federal insurance carriers.
In addition, Cobb committed perjury during his testimony before a grand jury when he falsely denied that he was ever paid by a territory manager who worked for Orthofix, and he lied by testifying that the surgeon he worked for was aware of the financial arrangement. Cobb admitted that, through his perjury, he obstructed the government’s investigation, as part of his guilty plea.
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Source- http://www.fbi.gov/cincinnati/press-releases/2012/owners-of-home-health-company-plead-guilty-to-health-care-fraud
COLUMBUS—Yasin M. Warsame, 45, of Westerville, and Amir Abdi Ahmed, 47, of Columbus, pleaded guilty in U.S. District Court to billing the Ohio Medicaid Program through their company, Damal Home Care Services, for approximately 1,500 skilled nursing home visits that never occurred.
Carter M. Stewart, U.S. Attorney for the Southern District of Ohio; Ohio Attorney General Mike DeWine; Edward Hanko, Special Agent in Charge, Federal Bureau of Investigation, Cincinnati Field Division (FBI); and Lamont Pugh, Special Agent in Charge, U.S. Department of Health and Human Services Office of Inspector General (HHS), announced the pleas entered today before U.S. District Judge Edmund A. Sargus, Jr.
According to a statement of facts presented during the hearing, Warsame and Ahmed submitted the bills on behalf of Damal between February 2010 and December 2010 and were paid $81,092.22. The patient files for which they billed had no documentation that the services were provided, nor was there any indication in the company’s nursing service logs that services had been rendered.
Each man pleaded guilty to one count of health care fraud, which is punishable by up to 10 years in prison, a fine of up to $250,000, three years of supervised release, and restitution. Judge Sargus will set a date for sentencing.
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Source- http://www.justice.gov/usao/iln/pr/chicago/2012/pr0905_01.pdf
CHICAGO — A Chicago area vascular and thoracic surgeon was sentenced today to 10
months in federal custody after being convicted at trial of making false statements in post-operation reports relating to health care services and Medicare benefits. The defendant, DR. JOHN NATALE, was found guilty following a week-long trial in May of two counts of making false statements by a jury that also acquitted him of two counts of health care fraud and one count of mail fraud for allegedly defrauding Medicare.
Natale, 63, of South Barrington, was ordered to begin serving his sentence on Nov. 1by U.S.
District Judge Rebecca Pallmeyer, who also imposed a fine of $40,000 and periods of community service during one year of supervised release after incarceration.
“The goal here was to collect more than he [Natale] otherwise would have been entitled,”
Judge Pallmeyer said in determining that there was an intended loss to Medicare of at least $10,000. Natale faced a maximum sentence of five years in prison and a federal sentencing guideline range of 15 to 21 months after Judge Pallmeyer also found that Natale had obstructed justice while testifying in his own behalf at trial. atale specialized in repairing abdominal aortic aneurysms, which is a weakening of the artery, and the trial focused on six surgeries he performed in 2003 and 2004 on patients at Northwest
Community Hospital in Arlington Heights. Natale later operated at Swedish Covenant Hospital in Chicago, according to his trial testimony.
Northwest Community Hospital medical officials, who also testified at trial, cooperated with
the government’s investigation.
The evidence at trial showed, and the jury found, that for at least two patients in 2004, Natale
prepared false post-operation reports that, among other things, contained extensive details about aneurysm repairs that he never performed, and falsely described the surgeries he did perform as being more complex and elaborate than they actually were. In the case of one patient whose medical condition deteriorated a year after Natale operated, another surgeon testified that he had to untangle the falsehoods in Natale’s records, which, if relied upon, would have had a serious impact on his subsequent treatment of that patient.
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Source- http://www.justice.gov/usao/nye/pr/2012/2012sep05.html
Loretta E. Lynch, United States Attorney for the Eastern District of New York, today announced the settlement of claims that New York Downtown Hospital (“NY Downtown”) defrauded the Medicare and Medicaid Programs in connection with an inpatient detoxification program which the hospital operated during the period July 21, 1998 through February 14, 2006. Pursuant to the settlement, NY Downtown has agreed to pay the United States and the State of New York $13.4 million.
The government’s claims arose from an investigation of allegations made in suits filed by private individuals pursuant to the False Claims Act, 31 U.S.C. §§ 3729-33,United States ex rel. Mathew I. Gelfand, M.D. v. SpecialCare Hospital Management Corp., et al., Civil Action No. 02-CV-6079; United States ex rel. Montaperto v. New Parkway Hospital, et al., Civil Action No. 05-CV-4911. The government’s claims against NY Downtown, have been resolved pursuant to an agreement approved by United States District Judge Leonard D. Wexler. Previously, the government resolved claims against Our Lady of Mercy Medical for $4.5 million. Claims against other defendants in the actions are pending.
The United States’ investigation established that NY Downtown, together with a Missouri-based company, Special Care Hospital Management Corporation (“Special Care”), operated an inpatient drug and alcohol detoxification program under the name New Vision without having received a license from the New York State Office of Alcoholism and Substance Abuse Services. Because the program was unlicensed, NY Downtown was not entitled to bill Medicare and Medicaid for treatment provided by the program. Additionally, the government’s investigation established that NY Downtown paid Special Care for patient referrals in violation of federal and state anti-kickback statutes. NY Downtown has denied the government’s allegations.
Medicare is a federally-funded health insurance benefits program which comprises several parts, including hospital insurance benefits for eligible persons aged 65 and older and for eligible persons with disabilities. Medicaid is a joint federal-state program which provides health care benefits for certain groups, primarily the poor and disabled. Under the settlement agreement, NY Downtown will be paying the United States $5,840,000.00, with interest, and will be paying New York State $7,560,000.00, with interest.
“We all pay when hospitals and their partners obtain Medicare and Medicaid funds to which they are not entitled. Health care providers must understand that they are not allowed to bill Medicare or Medicaid for unlicensed or otherwise unauthorized care. These practices are not only fraudulent, but serve to inflate the cost of health care in general,” stated Ms. Lynch. “The settlement demonstrates the commitment of this Office to hold those who defraud and jeopardize the nation’s vital, federally-funded health care programs fully accountable.”
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Source- http://www.justice.gov/opa/pr/2012/September/12-civ-1080.html
The government has intervened in a whistleblower lawsuit against Hospice of the Comforter Inc. (HOTCI) alleging false Medicare billings, the Justice Department announced today. HOTCI provides hospice services to patients residing in the vicinity of Orlando, Fla.
The Medicare hospice benefit is available for patients who elect palliative treatment (medical care focused on providing patients with relief from pain and stress) for a terminal illness, and have a life expectancy of six months or less if their disease runs its normal course. When an individual is admitted to a hospice facility, that individual is no longer entitled to receive curative care (services designed to cure his or her illness).
The lawsuit, filed by HOTCI’s former vice-president of finance, Douglas Stone, alleges that HOTCI knowingly submitted false claims to Medicare for hospice care for patients who were not terminally ill. Specifically, the lawsuit contends that HOTCI’s chief executive officer verbally instructed HOTCI employees to admit Medicare recipients for hospice care even where there had not yet been a determination that they were eligible for the hospice benefit. The lawsuit also alleges that, after being notified that it would be audited by its Medicare contractor, HOTCI formed an internal committee to review the eligibility of its Medicare patients and discharged at least 150 patients in 2009-2010 as being ineligible for the Medicare hospice benefit.
“The hospice benefit is intended only for people who qualify for and require such care,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division of the Department of Justice. “We will continue to protect this important component of the Medicare program by ensuring that entities providing hospice care are only treating, and billing for, qualified patients.”
“Some of the most vulnerable people in our district rely on hospice services,” said Robert O’Neill, U.S. Attorney for the Middle District of Florida. “It is critically important that Medicare remains solvent in order to provide hospice benefits, and that we confront those whose practices in this area put economic gain before patient care.”
The lawsuit was filed under the qui tam , or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the United States for the submission of false claims to the government. The private plaintiffs are entitled to receive a share of any funds recovered through the lawsuit. The False Claims Act authorizes the United States to intervene in such a lawsuit and take over primary responsibility for litigating it. The False Claims Act permits the government to recover three times its damages plus civil penalties.
The government’s intervention in this action is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $9.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13 billion.
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Source- http://www.fbi.gov/miami/press-releases/2012/president-of-miami-medical-clinic-pleads-guilty-to-health-care-fraud-charges
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; Michael B. Steinbach, Acting Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), announce that defendant Arbilio Yanes pled guilty today to Medicare fraud and related offenses before U.S. District Judge Cecilia M. Altonaga.
More specifically, Yanes pled guilty to one count of conspiracy to commit health care fraud and to pay health care kickbacks (count one); two counts of health care fraud (counts two and three); four counts of payment of health care kickbacks (counts four through seven); four counts of money laundering (counts eight through 11); and two counts of money laundering (counts 12 and 13). Sentencing is scheduled for November 5, 2012. At sentencing, Yanes faces a statutory maximum sentence of up to five years in prison on counts one and four through seven; up to 10 years in prison on counts two, three, 12, and 13; and up to 20 years in prison on counts eight through 11.
According to statements made in court at the plea hearing, Yanes was the president of Research Center of Florida Inc., a purported medical clinic located in Miami-Dade County, Florida. Between October 13, 2003 and November 5, 2004, Research Center submitted claims to Medicare for $21,043,982, almost exclusively for purported treatment of HIV+ Medicare beneficiaries by administration of prescription drugs. Based on these claims, Medicare paid Research Center $11,098,388.93. In fact, Research Center personnel generally administered smaller doses of the medications than the clinic billed in its claims or no treatment at all.
Yanes paid more than $1.6 million to shell companies controlled by outside patient recruiters. Those shell companies did no business with Research Center, but the recruiters located Medicare beneficiaries who were willing to attend Research Center as purported patients and paid the beneficiaries to do so. Yanes also paid himself over $1.3 million in profits from the scheme. Of that sum, Yanes paid more than $650,000 to two shell companies he controlled, which did no business with Research Center.
Efren Mendez, the vice-president of Research Center; Damian Beltran, a medical assistant at the clinic; and Barbara Perez and Caridad Perez, patient recruiters for the clinic, have all previously pled guilty to conspiracy to commit health care fraud in related cases.
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Source- http://www.fbi.gov/miami/press-releases/2012/eight-individuals-and-a-corporation-convicted-at-trial-in-florida-in-50-million-medicare-fraud-scheme
WASHINGTON—Eight individuals and a Miami-based corporation were convicted by a federal jury for their participation in a Medicare fraud scheme involving the submission of more than $50 million in fraudulent billings to Medicare, the Department of Justice, the FBI, and the Department of Health and Human Services (HHS) announced today.
Antonio Macli, the owner of Biscayne Milieu Health Center Inc., a mental health care corporation; his son Jorge Macli, Biscayne Milieu’s CEO; and Antonio Macli’s daughter Sandra Huarte, an executive at the company, were each found guilty in U.S. District Court for the Southern District of Florida of one count of conspiracy to commit health care fraud and one or more substantive counts of health care fraud, conspiracy to commit a health care kickback scheme, and conspiracy to commit money laundering and substantive counts of money laundering. Antonio Macli and Jorge Macli were also convicted of substantive kickback counts. Dr. Gary Kushner, the medical director at Biscayne Milieu, was found guilty of conspiracy to commit health care fraud and a substantive count of health care fraud. Rafael Alalu, a therapist, and Jacqueline Moran, who handled Medicare billing for Biscayne Milieu, were each found guilty of conspiracy to commit health care fraud and substantive counts of health care fraud. Anthony Roberts and Derek Alexander, two patient recruiters, were each found guilty of one count of conspiracy to commit a health care kickback scheme, and each was convicted of one health care kickback count.
The defendants were charged in a superseding indictment returned June 5, 2012. Twenty other individuals who worked at Biscayne Milieu have all previously pleaded guilty.
Evidence at trial demonstrated that the defendants and their co-conspirators caused the submission of false and fraudulent claims to Medicare through Biscayne Milieu, a Florida corporation headquartered in Miami that purported to operate a partial hospitalization program (PHP) in that city. Biscayne Milieu purported to provide PHP services, a form of intensive treatment for severe mental illness, for Medicare beneficiaries suffering from mental illnesses. In fact, however, the defendants devised a scheme in which they paid patient recruiters to refer ineligible Medicare beneficiaries to Biscayne Milieu for PHP services, which were never provided. Many of the beneficiaries admitted to Biscayne Milieu were not eligible for PHP because they were chronic substance abusers, suffered from severe dementia or Alzheimer’s disease and would not benefit from group therapy, or had no mental health diagnosis at all. Indeed, some beneficiaries were seeking fraudulent mental health treatment in order to be declared exempt from certain requirements for their applications for U.S. citizenship.
As part of a scheme orchestrated by Antonio Macli, Jorge Macli, and Huarte, Biscayne Milieu used fraudulent documents created by Alalu and others and bogus certifications signed by psychiatrists, including Kushner, to bill Medicare for tens of millions of dollars in false and fictitious services. Kushner did not treat patients but rather created and certified false documents to make it appear that ineligible patients were receiving legitimate PHP treatment. In addition, the evidence at trial showed that Alexander and Roberts solicited and received illegal kickbacks in exchange for sending ineligible patients to Biscayne Milieu.
Throughout the course of the fraud conspiracy, beneficiaries who did not qualify for PHP services attended treatment programs that did not provide legitimate PHP services. Biscayne Milieu billed tens of millions of dollars in services to patients who did not need the services and to whom the appropriate services were not provided. According to the evidence, co-conspirators personally altered, and caused the alteration of, patient files and therapist notes for the purpose of making it appear, falsely, that patients being treated by Biscayne Milieu were qualified for PHP treatments and that the treatments provided were legitimate PHP treatments. Evidence further revealed that Kushner signed patient files without providing meaningful treatment, and Biscayne Milieu then billed Medicare for millions of dollars in PHP treatment for these patients under his name as the attending physician. Once Biscayne Milieu received reimbursement from Medicare for these fraudulent services, its owners and executives laundered the money through various accounts to launder the proceeds of their illegal scheme.
Kushner and Alalu were remanded into custody. Antonio Macli, Jorge Macli, Huarte, Alexander, and Roberts were already in custody.
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Source- http://www.fbi.gov/indianapolis/press-releases/2012/rossville-man-sentenced-in-health-care-fraud-and-tax-evasion-case
HAMMOND, IN—United States Attorney David Capp announced that Chad Shedron, 36, of Rossville, Indiana, was sentenced by Chief Judge Philip Simon to 57 months’ imprisonment and one year of supervised release after pleading guilty to a two-count Information charging him with the felony offenses of executing a scheme to defraud the Indiana Medicaid health benefit program and evading federal income tax.
According to the plea agreement filed in this case, Shedron agreed to a money judgment in the amount of $3,521,961.22, which represents the dollar amount of proceeds derived from the health care fraud. He also agreed that the tax loss for 2007 was approximately $189,009.00, and further agreed that he is responsible for tax losses of $164,728.99 in 2008; $141,623.00 in 2009; and $32,310.00 in 2010. Further, Shedron agreed to forfeit his personal residence, $65,000 in cash, a brokerage account, jewelry, and a baseball card collection with an estimated value of over $200,000.
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Source- http://www.fbi.gov/charlotte/press-releases/2012/charlotte-woman-arrested-for-650000-medicaid-fraud-scheme
CHARLOTTE, NC—A Charlotte woman charged with defrauding Medicaid of at least $650,000 was arrested in Goldsboro, North Carolina, today, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
Charlotte Elizabeth Garnes, 37, of Charlotte was charged in a federal indictment returned by a grand jury in Charlotte on August 21, 2012, with one count of health care fraud conspiracy and one count of obstruction of official proceedings. The criminal bill of indictment, which was unsealed today, also includes a forfeiture allegation seeking a money judgment in the amount of at least $664,247.
U.S. Attorney Tompkins is joined in making today’s announcement by Attorney General Roy Cooper, who oversees the North Carolina Medicaid Investigations Division (MID), and Derrick Jackson, Special Agent in Charge, Department of Health and Human Services-Office of the Inspector General (HHS-OIG), Office of Investigations, Atlanta Region.
According to allegations in the indictment, Garnes participated in a scheme to defraud Medicaid by seeking and receiving payments for services that she did not perform. Filed court documents indicate that Garnes, who is a licensed professional counselor, has a Medicaid provider number that enables her to provide mental and behavioral health services to Medicaid participants. The indictment alleges that Garnes “rented out” her Medicaid provider number so that other unqualified individuals could submit fraudulent reimbursement claims for mental and behavioral health services to Medicaid through Garnes’s number.
According to allegations in the indictment, from March 2009 to April 2011, Garnes conspired with two individuals, Teresa Marible and Michele Jackson, to allow Marible and Jackson to submit fraudulent claims to Medicaid through Garnes’s company, Charlotte’s Insight Inc. Allegations contained in the indictment state that Garnes kept a percentage of the Medicaid reimbursement received for those claims. The indictment also alleges that neither Marible nor Jackson were licensed to provide mental and behavioral health services and therefore could not seek reimbursement from Medicaid. Garnes, therefore, falsely listed herself as the attending clinician for these claims even though she did not provide any of the claimed services.
In addition, the indictment alleges that during the relevant time period, Garnes also worked for a defense contractor at military bases and, in some instances, Garnes was not even in the country at the time that she claimed to have provided the Medicaid services. According to allegations in the indictment, Garnes also submitted and received payment for claims totaling more than 24 hours of services provided in a single day. In one instance in December 2009, Garnes represented that she provided 69 hours of mental and behavioral health services on a single day, the indictment alleges. According to the indictment, Garnes, Marible, and Jackson also submitted claims for several Medicaid beneficiaries who did not receive any services at all. The indictment alleges that the fraudulent scheme caused Medicaid to pay out to Garnes and her co-conspirators over $650,000 as a result of the false claims.
On August 2, 2012, Oriaku Hampton Sowell, 39, of Charlotte, pleaded guilty to her role in this scheme involving Garnes. According to filed court documents, Sowell conspired with Garnes, Marible, and Jackson to defraud Medicaid in an identical arrangement where Sowell rented out her Medicaid provider number. These reimbursement claims falsely listed Sowell as the attending clinician when she, in fact, did not provide the claimed services. Court records indicate that in exchange for the use of her Medicaid number, Sowell retained a percentage of the Medicaid reimbursement and paid the remainder to Jackson and Marible. From October 2010 to April 2011, the fraudsters collected at least $250,000 from Medicaid.
Marible was sentenced in June 2012 to serve 36 month in prison for her role in the scheme and was ordered to pay $1,135,662 in restitution. Jackson was sentenced in March 2012 to 15 months in prison and was ordered to pay $292,282 in restitution.
Garnes had her initial appearance today in U.S. District Court in Raleigh. If convicted, Garnes faces a statutory maximum sentence of 10 years in prison and a $250,000 fine for count one. Count two carries a statutory maximum sentence of 20 years in prison and a $250,000 fine. An indictment is merely an allegation, and Garnes is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.
In a separate but similar Medicaid fraud scheme, Gregory Benny Lassiter, 31, of Charlotte, entered a plea of guilty on August 17, 2012, for committing health care fraud conspiracy. According to the charging document and plea agreement filed in this case, Lassiter rented out his Medicaid provider number to allow a co-conspirator, Erika Holland, to submit fraudulent claims through his company, VisionOne Health Services (“VisionOne”). Holland was not licensed to provide mental and behavioral health services, and she did not employ any licensed therapists to perform such services. Lassiter, nevertheless, agreed to rent out his Medicaid provider number for the purpose of allowing Holland to submit fraudulent claims. Lassiter retained a percentage of the Medicaid reimbursement.
Similar to the schemes described above, the claims submitted falsely listed other licensed providers as the attending clinician, filed documents state. For example, Lassiter employed Dr. M.T. at VisionOne for a brief period of time, but Dr. M.T. did not provide any services to clients. According to court records, after Dr. M.T. left VisionOne, Lassiter fraudulently used Dr. M.T.’s Medicaid provider number to bill for services that Dr. M.T. did not provide. Some of the fraudulent claims submitted by Holland through Lassiter’s number fraudulently listed Dr. M.T. as the attending clinician. According to the charging document, from October 2010 to April 2011m Lassiter received in excess of $200,000 in fraudulent payments from Medicaid pursuant to the schemes.
Holland was sentenced in March 2012 to serve 54 months in prison and was ordered to pay $1,585,093 in restitution for this and other fraudulent schemes involving Medicaid. Lassiter faces a statutory maximum prison sentence of 10 years and a $250,000 fine. Lassiter was released on bond in August 2012 and awaits sentencing.
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