Source- http://www.justice.gov/opa/pr/2010/December/10-civ-1471.html
WASHINGTON – John D. Archbold Memorial Hospital Inc. has paid the United States a total of $13.9 million to settle allegations that the hospital submitted false claims to the state of Georgia’s Medicaid program, the Justice Department announced today.
The settlement resolves allegations that between November 2002 and July 2008, the Thomasville, Ga.-hospital made false representations to the Georgia Department of Community Health, the state agency that administers the Medicaid program in Georgia, that it was a public hospital for Medicaid purposes in order to increase the amount of Medicaid funds provided to the hospital. Under Medicaid rules, only public hospitals may participate in the Medicaid Upper Payment Limit (UPL) program. In addition, public hospitals receive additional Disproportionate Share Hospital (DSH) program funds that are not available to private hospitals. Contrary to its certification to the Georgia Department of Community Health, Archbold Memorial was in fact a private hospital, and as a result received millions of dollars in UPL and DSH funds to which it was not entitled.
"We are committed to protecting the integrity of the Medicaid program and ensuring that health care providers do not game the system to the detriment of the poor, disabled, and young people served by this important program," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice.
"The U.S. Attorney’s Office will continue to use the False Claims Act to protect programs like Medicaid, which rely on the honesty and accuracy of information provided by program providers to determine the amount of money paid by the United States," said Sally Quillian Yates, U.S. Attorney for the Northern District of Georgia in Atlanta. "Any false statements made in order to increase the amount of money the federal government spends to provide health care to its beneficiaries will be ferreted out and the funds recovered."
The civil settlement resolves a lawsuit filed in federal court in the Northern District of Georgia 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 today’s resolution, the whistleblower – Wesley Simms, M.D.– will receive $695,151 from the settlement amount.
This settlement is part of the government’s emphasis on combating health care fraud. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $5.3 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 now approach $6.8 billion.
The settlement was the result of a coordinated effort among the U.S. Attorney’s Office for the Northern District of Georgia, the Commercial Litigation Branch of the Justice Department’s Civil Division, and the Department of Health and Human Services’ Office of Inspector General and Office of Counsel to the Inspector General.
************************************************************************
Report Medicare & Medicaid Fraud by Calling 1-888-482-6825 or by visiting
www.usawhistleblower.com
Wednesday, December 22, 2010
John D. Archbold Memorial Hospital Inc. has paid the United States a total of $13.9 million to settle allegations that the hospital submitted false claims to the state of Georgia’s Medicaid program.
Dannette M. Hawthorne, Charlene Breedlove-Jones & Deneshia M. Wakefield Charged with Conspiracy, Making False Statements to Medicaid, and Other Crimes in Connection with Two Columbus Pain Management Clinics
Source- http://cincinnati.fbi.gov/dojpressrel/pressrel10/ci122210.htm
COLUMBUS—A federal grand jury has indicted the owner and two employees of two pain management clinics in Columbus, alleging that they were operating as “pill mills” by distributing prescriptions for pain medicine without a legitimate medical need for the prescriptions and fraudulently billing government insurance programs for the drugs.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Robert L. Corso, Special Agent in Charge, Drug Enforcement Administration (DEA), Lamont Pugh, Special Agent in Charge, U.S. Department of Health and Human Services Office of Inspector General, Keith L. Bennett, Special Agent in Charge, Federal Bureau of Investigation, Cincinnati Field Division (FBI), Ohio Attorney General Richard Cordray’s Medicaid Fraud Control Unit, Executive Director William Wimsley of the Ohio Board of Pharmacy and Franklin County Sheriff Jim Karnes announced the indictment which was returned December 21, 2010.
Charged in the indictment are: Dannette M. Hawthorne, 48, of Columbus, the owner of the two Columbus clinics, Trinity Medical Center, LLC, and Perspective Medical Solutions, Inc.
Charlene Breedlove-Jones, 53, of Columbus. She is identified as the office manager for both clinics.
Deneshia M. Wakefield, 37, of Columbus. She is identified as an employee at both clinics.
The indictment alleges that the clinics began operating as “pill mills” in January 2010 by selling prescriptions for controlled substances, primarily oxycodone, without a legitimate medical need for the prescriptions. Many of the prescriptions allegedly contained the forged signatures of physicians who had temporarily worked at Trinity and Perspective, but whom had terminated their employment with the clinics prior to the forgeries. The defendants allegedly sold the prescriptions to patients for cash.
The indictment also alleges that the defendants conspired to charge patients, most of whom were Medicaid recipients, between $150 and $300 for each visit. The clinics refused to accept insurance and only accepted cash payments. Many of the patients travelled from other regions of Ohio, West Virginia, and Kentucky. The clinics possessed virtually no medical equipment except for blood pressure cuffs, scales and exam tables. It was part of the conspiracy to direct the patients to specific pharmacies and/or to frequently change pharmacies in order to avoid the suspicion of pharmacists who became concerned about the large dosages and quantities of the pain medications being prescribed to patients by Trinity and Perspective. The pharmacies subsequently submitted the claims for payment to the Medicaid Program.
All three defendants are charged with conspiracy to distribute controlled substances. Under law, the crime can be punished by a maximum sentence of 20 years in prison. In addition, Breedlove-Jones is charged with six counts of making false health care statements, punishable by up to five years in prison on each count. She is also charged with two counts of obtaining controlled substances by fraud, punishable by up to four years in prison. She faces two counts of distribution of a controlled substance, each carrying a maximum penalty of 20 years in prison, and one count of aggravated identity theft. The sentence for aggravated identity theft is two years in prison, consecutive to any other time served.
Wakefield faces four counts of making false health care statements, two counts of obtaining controlled substances by fraud and one count of aggravated identity theft.
Stewart commended the cooperative investigation by the federal, state, and local law enforcement agencies who joined in making the announcement, and Assistant U.S. Attorney Kenneth Affeldt, who is prosecuting the case.
************************************************************************
Report Medicare & Medicaid Fraud by Calling 1-888-482-6825 or by visiting
www.usawhistleblower.com
Monday, December 20, 2010
Dey Inc., Dey Pharma L.P. (formerly known as Dey, L.P.) and Dey L.P. Inc. have agreed to pay $280 million to settle False Claims Act Allegations
Source- http://www.justice.gov/opa/pr/2010/December/10-civ-1464.html
WASHINGTON – Dey Inc., Dey Pharma L.P. (formerly known as Dey, L.P.) and Dey L.P. Inc. have agreed to pay $280 million to settle False Claims Act allegations, the Department of Justice announced today. This settlement resolves claims by the United States that the defendants engaged in a scheme to report false and inflated prices for numerous pharmaceutical products, knowing that federal health care programs relied on those reported prices to set payment rates. The actual sales prices for the Dey products were far less than what Dey reported.
The United States alleged that Dey reported false prices for the following drugs: Albuterol Sulfate, Albuterol MDI, Cromolyn Sodium and Ipratropium Bromide. The difference between the resulting inflated government payments and the actual price paid by health care providers for a drug is referred to as the “spread.” The larger the spread on a drug, the larger the profit for the health care provider or pharmacist who is reimbursed by the government. The government alleges that Dey created artificially inflated spreads to market, promote and sell the drugs to existing and potential customers. Because payment from the Medicare and Medicaid programs was based on the false inflated prices, the government alleged that Dey caused false and fraudulent claims to be submitted to federal health care programs and, as a result, the government paid millions of claims for far greater amounts than it would have if Dey had reported truthful prices.
This is the fourth such settlement with pharmaceutical manufacturers that the Department of Justice has announced this month. On Dec.7, 2010, the Department announced settlements totaling $421.1 million involving similar allegations against three other manufacturers: Abbott Laboratories Inc., B. Braun Medical Inc. and Roxane Laboratories Inc.
“With this settlement, the Department of Justice has now recovered over $2 billion dollars from pharmaceutical manufacturers arising from similar unlawful drug pricing schemes. As the department alleged in its complaint against Dey, by offering customers one price and then falsely reporting inflated prices to the lists the government uses when calculating how much to pay for the drugs, pharmaceutical companies created an incentive for the purchase of their drugs by allowing buyers to pocket the difference between the actual price of the drug and the inflated government payment,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “ Taxpayer-funded kickback schemes like this not only cost federal health care programs millions of dollars, they threaten to undermine the integrity of the choices health care providers make for their patients.”
United States Attorney Carmen M. Ortiz of the District of Massachusetts said, “Our federally-funded health care programs pay for prescription drugs based in part on pricing information reported by pharmaceutical companies. When a company reports falsely inflated prices for the purpose of increasing its sales and profits, it undermines the integrity of our health care system. Drug companies must understand that they risk substantial liability if they report false drug pricing information.”
The settlement resolves a whistleblower action filed under the False Claims Act by Ven-A-Care of the Florida Keys Inc., a Florida home-infusion company, and its principals, entitled United States of America ex rel. Ven-a-Care of the Florida Keys Inc. v. Dey Laboratories, et al., Civil Action No. 05-11084-PBS (D. Mass). The False Claims Act’s qui tam provisions allow private persons with knowledge of fraud to file suit on behalf of the United States and share in any recovery. As part of this settlement, the Ven-A-Care whistleblowers will receive a share of approximately $67.2 million.
“This settlement with Dey highlights the Office of the Inspector General’s decade-long commitment to protecting against artificially inflated drug prices,” said Daniel R. Levinson, Inspector General of the Department of Health & Human Services. “Our analyses of drug price reporting practices – including the use of ‘Average Wholesale Price’ – have consistently identified excessive Medicare and Medicaid payments resulting from these practices.”
The case was handled by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the District of Massachusetts and the Office of Inspector General of the Department of Health and Human Services.
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 $5.3 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 now approach $6.8 billion.
************************************************************************
Report Medicare & Medicaid Fraud by Calling 1-888-482-6825 or by visiting
www.usawhistleblower.com
Saturday, December 18, 2010
Nearly $52 million in damages and penalties awarded in Attorney General's drug pricing case against Johnson & Johnson
Source- http://www.attorneygeneral.gov/press.aspx?id=5907
HARRISBURG - Attorney General Tom Corbett announced that New Jersey-based Johnson & Johnson, Inc. has been found liable to Pennsylvania for nearly $52 million in damages and civil penalties for falsely reporting the prices of its drugs. Commonwealth Court Judge Robin Simpson rendered the verdict on December 7, 2010, following a five-week trial in Easton, Pennsylvania.
Corbett explained that in 2004, the Office of Attorney General sued Johnson & Johnson and several of its subsidiaries, as well as 14 other drug companies, for allegedly manipulating a pricing benchmark known as Average Wholesale Price ("AWP"). According to the lawsuits, Johnson & Johnson and other drug manufacturers inflated AWP above the true average of wholesale prices in order to increase drug sales and profits. Many government benefit programs, like Medicaid and PACE (the Pharmaceutical Assistance Contract for the Elderly, run by the Pennsylvania Department of Aging), reimburse pharmacies for brand name drugs using a formula which includes AWP.
"Medicaid and PACE serve the most vulnerable Pennsylvanians, including low income families and seniors," Corbett said. "Taking money from these programs by manipulating and inflating drug prices is simply unconscionable."
Corbett said Judge Simpson found that Johnson & Johnson engaged in unfair and deceptive practices by failing to report accurate wholesale prices.
Johnson & Johnson has been ordered to repay $45,283,562 to Medicaid and PACE Program, along with $6,567,000 in civil penalties. The Court also issued a perpetual injunction requiring Johnson & Johnson to report accurate prices.
Throughout the trial, the Commonwealth contended that Johnson & Johnson inflated its AWP's to create a "spread" between actual wholesale prices and the AWP. Doctors and pharmacies allegedly received that spread as an incentive to prescribe or stock Johnson & Johnson drugs.
"The Pennsylvania Legislature set up a simple system for reimbursement of pharmaceuticals: pay doctors and pharmacies their wholesale costs plus a dispensing fee," Corbett said. "Johnson & Johnson and other drug companies turned that simple system into a marketing gimmick, increasing sales and company profits at the expense of consumers and taxpayers."
Johnson & Johnson can challenge the verdict on appeal and has not paid the restitution or penalties that were awarded. Prosecution of the trial was done by Donald Haviland, Esquire of the Haviland Hughes Law Firm, with the assistance of the Attorney General's Antitrust Section.
************************************************************************
Report Medicare & Medicaid Fraud by Calling 1-888-482-6825 or by visiting
www.usawhistleblower.com
Friday, December 17, 2010
Yudel Cayro, owner and operator of Courtesy Medical Group Inc., was sentenced to 60 months in prison for his role in a wide-ranging Medicare fraud scheme
Source- http://www.justice.gov/opa/pr/2010/December/10-crm-1457.html
Yudel Cayro, owner and operator of Courtesy Medical Group Inc., a medical clinic in Miami, was sentenced to 60 months in prison for his role in a wide-ranging Medicare fraud scheme involving Miami-area home health agencies, the Departments of Justice and Health and Human Services (HHS) announced today.
U.S. District Judge Adalberto Jordan also ordered Cayro to serve two years of supervised release following his prison term and ordered him to pay $9.8 million in restitution jointly and severally with his co-defendants and co-conspirators in a related case. The restitution is to be paid to the victim in this case, the Centers for Medicare and Medicaid Services (CMS).
According to court documents, Cayro admitted that Courtesy operated in part to provide unnecessary prescriptions, plans of care and medical certifications, among other things, to Miami-area home health agencies in return for kickbacks and bribes. Courtesy provided the fraudulent medical documents so that the home health agencies could bill the Medicare program for expensive home health services and therapy purportedly for insulin dependant diabetic Medicare beneficiaries. In fact, the beneficiaries did not need and in some cases did not receive the services.
According to court documents, approximately 344 prescriptions for these unnecessary services were issued through Courtesy and signed by Cayro’s co-defendant, Dr. Fred Dweck. As a result, Medicare was fraudulently billed approximately $16.6 million for home health services. Medicare paid almost $10 million of the fraudulent claims. Another owner and operator of Courtesy, co-defendant Arturo Fonseca, was sentenced in November 2010, by Judge Jordan to 60 months in prison and two years of supervised release.
Three of Cayro’s co-defendants, Miami-area nurses Armando Sanchez, Marlenys Fernandez and Silvio Ruiz were sentenced last week to prison for their roles in the scheme. Sanchez and Fernandez were each sentenced to 30 months in prison. Ruiz was sentenced to four months in prison. Judge Jordan also ordered Fernandez to pay $331,622, Sanchez to pay $602,585, and Ruiz to pay $79,230 in restitution to CMS, jointly and severally with their co-defendants and co-conspirators in a related case.
According to court documents, the nurses were engaged in the fraudulent scheme at ABC Home Health and Florida Home Health Care Providers Inc., two Miami home health agencies that were engaged in billing the Medicare program for unnecessary home health services for Medicare beneficiaries. Specifically, the nurses admitted to falsifying patient files to make it appear that these Medicare beneficiaries qualified for two to three times daily skilled nursing visits to purportedly administer diabetic insulin injections. In fact, these Medicare beneficiaries did not need nor qualify for these services.
According to court documents, Sanchez admitted that as a result of his actions, more than $900,000 was falsely billed to the Medicare program; Fernandez admitted to causing approximately $500,000 in fraudulent billings to Medicare; Rotta admitted to causing more than $100,000 in fraudulent billing; and Ruiz admitted to causing approximately $115,000 in fraudulent billing.
Additional co-defendants await sentencing in January 2011, including Dr. Fred Dweck, whose sentencing was continued to Jan. 28, 2011.
************************************************************************
Report Medicare & Medicaid Fraud by Calling 1-888-482-6825 or by visiting
www.usawhistleblower.com
Dr. Alan Silber was sentenced yesterday in Detroit to 36 months in prison for participating in a scheme to defraud the Medicare program
Source- http://www.justice.gov/opa/pr/2010/December/10-crm-1455.html
WASHINTON – Dr. Alan Silber was sentenced yesterday in Detroit to 36 months in prison for participating in a scheme to defraud the Medicare program, announced the Departments of Justice and Health and Human Services (HHS).
U.S. District Court Chief Judge Victoria A. Roberts ordered Silber of West Bloomfield, Mich., to pay approximately $649,000 in restitution, jointly and severally with co-defendants. Silber was also sentenced to 3 years of supervised release to follow his prison term.
Silber, 48, was convicted by a federal jury in the Eastern District of Michigan on April 2, 2010, after a week-long trial, of six counts of heath care fraud. Between approximately November 2006 and March 2007, Silber and others caused nearly $1 million in false and fraudulent claims to be submitted to the Medicare program for services supposedly provided by Silber at RDM Centers Inc., a purported infusion clinic. Medicare actually paid more than $649,000 of those claims.
Evidence presented during Silber’s trial established that beginning in approximately November 2006 and continuing until March 2007, Silber routinely prescribed for patients at RDM medications that were medically unnecessary, and in many cases, never provided. In fact, the clinic existed for the purpose of causing fictitious claims for injection and infusion therapy services to be billed to Medicare. Silber was the only doctor who worked at RDM, and the owners of the clinic asked him to prescribe particular drugs to patients because they believed that Medicare would reimburse the medications at a high rate. Evidence at trial showed that Silber agreed to prescribe the medications even though he knew the patients did not need them.
According to court documents and evidence presented at trial, Medicare beneficiaries were not referred to RDM by their primary care physicians or for any legitimate medical purpose, but were recruited to come to the clinics in exchange for the payment of cash kickbacks. Trial evidence showed that in exchange for the cash kickbacks, the Medicare beneficiaries visited the clinic and signed documents indicating that they had received the services billed to Medicare.
All seven defendants charged in connection with RDM have pleaded guilty or have been convicted at trial for their roles in the fraud scheme.
Today’s sentencing 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.
This case was prosecuted by Trial Attorney Benjamin D. Singer and Assistant Chief John Neal of the Criminal Division’s Fraud Section, and by Special Assistant U.S. Attorney Thomas Beimers from the Eastern District of Michigan. The FBI and HHS-OIG conducted the investigation. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since their inception in March 2007, Medicare Fraud Strike Force operations in seven districts have obtained indictments of more than 825 individuals who collectively have falsely billed the Medicare program for more than $2 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
************************************************************************
Report Medicare & Medicaid Fraud by Calling 1-888-482-6825 or by visiting
www.usawhistleblower.com
Thursday, December 16, 2010
American Senior Communities LLC of Indianapolis agreed to pay $376K civil penalty in settlement
A nursing home company will pay the State of Indiana and federal government $376,432 to settle allegations that it submitted ineligible bills to Medicaid for work performed by seven employees who have been excluded from the Medicaid program, Attorney General Greg Zoeller announced today.
The settlement that American Senior Communities LLC of Indianapolis agreed to pay is the largest settlement agreement the Indiana Attorney General's Office has received in a Medicaid excluded-provider case to date. The case initially was investigated by the Attorney General's Medicaid Fraud Control Unit (MFCU), which since early 2008 has settled with 36 health providers in such cases totaling $988,117.96 in state and federal recoveries.
"Ensuring that health care employees who serve our seniors and most vulnerable patients in the Medicaid program are qualified and worthy of people's trust is a priority of my office. At a time when every tax dollar is precious, tracking down those ineligible to work in Medicaid in order to claw back overpayments is important and will hopefully ensure greater statutory compliance for providers in the future. When companies flout the rules and employ individuals undeserving of that trust, then the State of Indiana has an obligation to investigate so that Medicaid funds wrongly paid out can be recovered," Zoeller said.
If individuals who work in health care professions are convicted of various crimes, then the federal government excludes them from involvement in Medicaid and other federally funded health care programs. That means health care providers are prohibited from billing federal health care programs for those employees' services.
To enforce those exclusions, the Attorney General's MFCU staff identifies individuals who worked for a Medicaid provider while excluded. They review records and determine if the health care provider billed Medicaid for services the workers performed - and if so, calculate the potential overpayment the provider received. When they find violations, MFCU can take legal action against the Medicaid provider or refer the case the U.S. Department of Health and Human Services' Office of Inspector General (HHS-OIG) for legal action.
Based on this MFCU investigation, HHS-OIG alleged that American Senior Communities - a nursing and rehabilitation care company -- employed seven individuals in Indiana whom the company knew or should have known were excluded from participation in Medicaid or other federal health care programs. To resolve the case, American Senior Communities has agreed to pay a civil monetary penalty of $376,432 for the combined federal-state recovery, of which the state's portion is $130,040. The company denied any liability, and it agreed to implement policies and procedures to prevent hiring or contracting with any person or entity excluded from Medicaid, the agreement said.
A total of $988,117.96 in combined state and federal recoveries have been obtained through settlements with 36 excluded providers since early 2008 through the efforts of the Attorney General's Medicaid Fraud Control Unit.
"We are pleased with our results in identifying excluded individuals working for nursing homes and other health care providers. Many hours have been spent identifying excluded individuals working illegally in the health care industry," said Deputy Attorney General Allen K. Pope, director of the AG's Medicaid Fraud Control Unit.
Pope noted that three deputy attorneys general, Nicholas Gonzales, Jessica Harlan and Steve Hunt, deserve special recognition for their work coordinating the collection of evidence, drafting pleadings, and negotiating settlements, as do current and former MFCU law clerks who worked on the project. "Their efforts have benefited the taxpayers of Indiana and of the United States directly in the amount of nearly $1 million dollars. Indirectly, they have saved the taxpayers far more by prodding many healthcare employers to establish a routine of regularly checking their employees against the federal government's list of excluded individuals," Pope said.
************************************************************************
Report Medicare & Medicaid Fraud by Calling 1-888-482-6825 or by visiting
www.usawhistleblower.com
Wednesday, December 15, 2010
Bernice Brown owner of Wayne County Therapeutic Inc. , to 151 months imprisonment and Daniel Smorynski, to 108 months in prison for Medicare fraud.
Source- http://detroit.fbi.gov/dojpressrel/pressrel10/de121410.htm
WASHINGTON—The owner and the vice president of a Detroit-area physical therapy clinic were sentenced to 151 months and 108 months in prison, respectively, for their leading roles in a $23 million Medicare fraud scheme, the Departments of Justice and Health and Human Services (HHS) announced.
Bernice Brown, 56, the owner of Wayne County Therapeutic Inc. (WCT), and Daniel Smorynski, 63, the vice president of WCT, were sentenced by U.S. District Court Judge Arthur Tarnow in the Eastern District of Michigan. In addition to their prison terms, Brown and Smorynski were sentenced to three years of supervised release and were ordered to pay jointly and severally $6.5 million in restitution.
Brown and Smorynski were convicted by a federal jury earlier this year, after a six-day trial. Brown was convicted of one count of conspiracy to commit health care fraud and nine counts of health care fraud. Smorynski was convicted of one count of conspiracy to commit health care fraud and five counts of health care fraud. Smorynski was acquitted on four counts of health care fraud.
According to evidence presented at trial, WCT, which operated in Livonia, Mich., purported to specialize in physical and occupational therapy. Evidence at trial established that Brown purchased from certain third-party contractors fake physical and occupational therapy files that were created by non-enrolled, and in many cases, non-licensed contractor therapists. Rather than provide therapy, the contractor therapists paid Medicare beneficiaries cash kickbacks to induce the Medicare beneficiaries to provide their Medicare numbers and to sign false documentation to make it appear as if they received therapy. Most, if not all, of the therapy was completely fictitious. Brown and Smorynski billed the services reflected in the fictitious files to Medicare as if WCT therapists had provided the services. Brown instructed her staff to create false documents to add to the fictitious medical files to make it appear that WCT therapists, who were licensed in the state and enrolled with Medicare, had performed the services, when she knew they had not. Smorynski was in charge of billing at WCT and aided in the submission of claims for services he knew WCT did not provide. Between approximately October 2002 and September 2006, Brown and Smorynski submitted approximately $23.2 million in claims to Medicare for physical and occupational therapy services that were never provided. Medicare paid approximately $6.5 million of those claims.
Evidence at trial showed that Brown and Smorynski, in addition to submitting claims for non-existent physical and occupational therapy, caused WCT to submit fraudulent claims for psychotherapy services. In January 2006, when Congress enacted a cap on physical and occupational therapy services to control costs, Brown and Smorynski devised a scheme to avoid the cap by billing for psychotherapy services. Evidence at trial showed that Brown and Smorynski launched a lobbying effort to repeal the cap, which included WCT staff drafting letters and petitions to Congress purportedly on behalf of Medicare patients. Brown and Smorynski then instructed WCT staff to bill Medicare for their lobbying efforts as psychotherapy evaluations and visits. In 2006, WCT billed $493,200 to Medicare for psychotherapy services that were not necessary and not provided, and Medicare paid approximately $121,921 of those claims.
Today's sentences were 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 (HHS-OIG) Chicago Regional Office.
These cases were prosecuted by Trial Attorneys Benjamin Singer and Gejaa T. Gobena of the Criminal Division's Fraud Section. The cases were investigated by the FBI and HHS-OIG, and were brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division's Fraud Section and the U.S. Attorney's Office for the Eastern District of Michigan.
Since its inception in March 2007, Medicare Fraud Strike Force operations in seven districts have obtained indictments of more than 825 individuals and organizations that collectively have billed the Medicare program for more than $2 billion. In addition, HHS's Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
************************************************************************
Report Medicare & Medicaid Fraud by Calling 1-888-482-6825 or by visiting
www.usawhistleblower.com
