Source- http://www.justice.gov/opa/pr/2013/February/13-crm-243.html
The owners and operators of two Miami health care agencies were sentenced to nine years and more than four years in prison today, respectively, and ordered to pay millions in restitution for their participation in a $48 million home health Medicare fraud scheme that billed for unnecessary home health care and therapy services.
The sentences, imposed in federal court in the Southern District of Florida, were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
U.S. District Judge Frederico A. Moreno sentenced Rogelio Rodriguez, 43, and Raymond Aday, 48, both of the Miami-Dade area, to 108 months and 51 months in prison, respectively. In addition to the prison term, Judge Moreno sentenced Rodriguez to pay $33 million in restitution, and Aday to pay $2.1 million in restitution. Both defendants were also sentenced to serve three years of supervised release and pay a $100,000 fine. In December 2012, each pleaded guilty to one count of conspiracy to commit health care fraud.
According to court documents, Rodriguez was the owner of both Caring Nurse Home Health Corp. and Good Quality Home Health Inc., and Aday was a manager at Caring Nurse and owner of Good Quality.
According to plea documents, Rodriguez and Aday conspired with patient recruiters for the purpose of billing the Medicare program for unnecessary home health care and therapy services. Rodriguez, Aday and their co-conspirators paid kickbacks and bribes to patient recruiters. In return, recruiters provided patients to Caring Nurse and Good Quality, as well as prescriptions, plans of care (POCs) and certifications for medically unnecessary therapy and home health services for Medicare beneficiaries. Rodriguez and Aday used these prescriptions, POCs and medical certifications to fraudulently bill the Medicare program for home health care services, which both Rodriguez and Aday knew was in violation of federal criminal laws.
According to court documents, nurses and office staff at Caring Nurse and Good Quality falsified patient files to make it appear the Medicare beneficiaries qualified for services they did not. Rodriguez admitted to knowing that these files were falsified so the Medicare program could be billed for medically unnecessary therapy and home health related services.
From approximately January 2006 through June 2011, Caring Nurse and Good Quality submitted approximately $48 million in claims for home health services that were not medically necessary and/or were not provided. According to court documents, Medicare paid approximately $33 million for these fraudulent claims.
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Source- http://www.justice.gov/opa/pr/2013/February/13-crm-235.html
Two former owners of a Los Angeles-area medical equipment wholesale supply company pleaded guilty today to conspiring with their customers to defraud Medicare.
The pleas were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. of the Central District of California; Glenn R. Ferry, Special Agent in Charge for the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); Bill L. Lewis, Assistant Director in Charge of the FBI’s Los Angeles Field Office; and Joseph Fendrick, Special Agent in Charge of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse (Cal-DOJ).
Rajinder Singh Paul, 69, and Baljit Kaur Paul, 65, of Redlands, Calif., each pleaded guilty before U.S. District Judge Percy Anderson in the Central District of California to one count of conspiracy to commit health care fraud.
In court documents, Rajinder and Baljit Paul admitted that they were the president and vice president, respectively, and shareholders of AHPK Inc., a medical equipment wholesale supply company located in Redlands and Ontario, Calif., and formally known as Major’s Wholesale Medical Supply Inc. The Pauls later sold Major’s Wholesale Medical Supply Inc. to Major’s Wholesale Medical Supply LLC (collectively, “Major’s”) and, according to court documents, remained employed at Major’s Wholesale Medical Supply LLC as consultants until they were terminated in February 2009.
During the time the Pauls either owned or worked as consultants for Major’s, Major’s sold durable medical equipment (DME) almost exclusively to customers who owned and operated DME supply companies, according to court documents. A majority of Major’s customers were Medicare providers and relied on Medicare to make money, which they did by billing Medicare for the DME that they purchased from Major’s.
One of the more popular items of DME that the Pauls sold at Major’s were power wheelchairs. Court documents indicate that to attract customers, the Pauls sold power wheelchairs to Major’s customers wholesale for between $850 to $1,000 each. Major’s customers, however, billed these power wheelchairs to Medicare at a rate of between $3,000 to $6,000 per wheelchair.
The Pauls admitted they knew that Major’s customers were dependent on Medicare for their revenue, and that Major’s customers could not pay Major’s unless Medicare paid the customers first. To foster customer loyalty, the Pauls engaged in a variety of conduct over a period of six years that helped Major’s customers defraud Medicare, including by providing Major’s customers with false inventory purchase agreements that showed they had higher credit limits than they really did. Major’s customers submitted these false inventory purchase agreements to Medicare to prove, as required by Medicare, the ability to purchase the volume of DME they billed.
The Pauls also admitted they provided Major’s customers with backdated invoices, knowing customers were billing Medicare for power wheelchairs and DME before the customers actually purchased or delivered the equipment. The Pauls admitted that by backdating these invoices, they provided Major’s customers with the paper trail the customers needed to prove to Medicare that they had both purchased the DME and purchased it before they submitted their claims to Medicare. According to court documents, the Pauls backdated or falsified invoices for more than 100 different customers.
Court documents indicate that two of many customers who conspired with the Pauls to defraud Medicare owned and operated a number of fraudulent DME supply companies in the Los Angeles area, including one customer who used “straw” or nominee owners to operate the customer’s companies. The Pauls admitted they provided these two customers with false inventory purchase agreements and backdated invoices that the customers used to defraud Medicare. The Pauls admitted that as a result of their conduct, these two customers were able to use their fraudulent DME supply companies to submit approximately $16,662,143 in false claims to, and receive approximately $9,743,609.42 in ill-gotten reimbursement payments from, Medicare.
At sentencing, scheduled for July 8, 2013, the Pauls each face a maximum penalty of 10 years in prison and a $250,000 fine.
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Source- http://www.justice.gov/opa/pr/2013/February/13-crm-234.html
A former owner of mental health facilities in Florida and North Carolina was sentenced today to serve 168 months in prison for his leadership role in a health care fraud scheme involving defunct health provider Health Care Solutions Network Inc. (HCSN), announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
Armando Gonzalez, 50, of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. In addition to his prison term, Gonzalez was sentenced to serve three years of supervised release and ordered to pay 28,092,283 in restitution, which, under the terms of Gonzalez’s plea agreement, will be satisfied in part by seized assets including $987,000 in currency seized in July 2012 and Gonzalez’s mansion in Hendersonville, N.C.
On Dec. 17, 2012, Gonzalez pleaded guilty to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.
According to court documents, HCSN operated community mental health centers at three locations in Miami-Dade County, Fla., and one location in Hendersonville. HCSN purported to provide partial hospitalization program (PHP) services to individuals suffering from mental illness. A PHP is a form of intensive treatment for severe mental illness. According to court documents, HCSN obtained Medicare beneficiaries to attend HCSN for purported PHP treatment that was unnecessary and, in many instances, not even provided.
Gonzalez orchestrated the HCSN fraud scheme, which centered on the recruitment and admission of patients who could not benefit from PHP services. In Miami, Gonzalez utilized patient recruiters to pay cash kickbacks in exchange for referrals from Assisted Living Facilities (ALF) patients who often suffered from conditions such as dementia and mental retardation. Once the unqualified patients were admitted to HCSN, Gonzalez’s employees would fabricate virtually every portion of the patients’ mental health medical records. The fake medical records were then utilized to support false billings to government sponsored health care benefit programs and to avoid detection by Medicare auditors.
In North Carolina, HCSN employees also routinely submitted false billing for patients watching movies, attending BBQs and, more commonly, patients who were not even present at the Miami and North Carolina facilities.
Gonzalez also admitted to his role in a money laundering scheme involving Psychiatric Consulting Network Inc. (PCN), a Florida corporation that was utilized by HCSN as a shell corporation to launder millions in health care fraud proceeds.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services that resulted in more than $28 million in payments.
Fifteen defendants have been charged for their alleged roles in the HCSN health care fraud scheme, and ten defendants have pleaded guilty. Alleged co-conspirators Wondera Eason and Paul Layman are scheduled for trial on March 11, 2013, before Judge Altonaga in Miami. Alleged co-conspirators Dr. Alina Feas, Dana Gonzalez and Lisset Palmero are scheduled for trial on June 3, 2013. Defendants are presumed innocent until proven guilty at trial.
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Source- http://www.justice.gov/opa/pr/2013/February/13-crm-233.html
A co-owner and operator of three Miami discount pharmacies was sentenced today to 168 months in prison for his role in a health care fraud scheme that submitted more than $23 million in false claims to Medicare.
The sentence was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
Jose Carlos Morales, 55, of Miami, was sentenced by U.S. District Judge Joan A. Lenard in the Southern District of Florida. In addition to his prison term, Morales was sentenced to serve three years of supervised release and to pay a $100,000 fine. A hearing to determine the amount of restitution Morales will pay has been scheduled for April 29, 2013.
On Dec. 6, 2012, Morales pleaded guilty in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and pay illegal health care kickbacks.
According to court documents, Morales was the co-owner of Pharmovisa Inc. and PharmovisaMD Inc., which operated a total of three pharmacies in Miami. Morales paid illegal health care kickbacks to co-conspirators in return for a stream of beneficiary information to be used to submit claims to Medicare and Medicaid. The beneficiaries who were referred to the pharmacies in exchange for kickback payments resided at assisted living facilities (ALFs) located in Miami. Morales and his alleged co-conspirators also paid illegal health care kickbacks to physicians in exchange for prescription referrals, which the pharmacies ultimately billed to Medicare.
Court documents also reveal that beginning in approximately 2007, drivers working for Morales’ pharmacies, at his direction, delivered “bingo cards” containing pop out medications to ALFs located throughout the Southern District of Florida. Morales instructed the drivers to pick up any unused “bingo cards” so that Morales pharmacy personnel could put the medications back into pill bottles. Unused and partially used medications were eventually re-billed to Medicare and Medicaid, and a majority of the previously submitted claims to Medicare and Medicaid were never reversed. Morales also instructed Morales pharmacy personnel to place unused and partially used medications into bottles to be sold directly to the general public from the “community” pharmacy shelves.
Morales and his alleged co-conspirators also engaged in sham financial transactions to facilitate and conceal the fraud schemes and the flow of fraud proceeds, according to court documents. In most instances, the sham transactions involved shell entities owned and/or controlled by Morales or his alleged co-conspirators.
According to court documents, Morales and his co-conspirators submitted and caused to be submitted approximately $23,367,755 in false and fraudulent claims to the Medicare and Florida Medicaid programs.
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Source- http://www.justice.gov/opa/pr/2013/February/13-civ-232.html
Williston Rescue Squad Inc. has agreed to pay the United States $800,000 to resolve allegations that it violated the False Claims Act by making false claims for payment to Medicare for ambulance transports, the Justice Department announced today. Williston, based in Williston, S.C., provides ambulance transport services in the southwestern part of South Carolina.
Medicare is a federally-funded health care program that is intended to provide basic medical insurance to people over the age of 65. Medicare reimburses providers only for non-emergency ambulance transports if the patient transported is bed-confined or has a medical condition that requires ambulance transportation. The settlement resolves allegations that Williston billed Medicare for routine, non-emergency ambulance transports that were not medically necessary and that Williston created false documents to make the transports appear to meet the Medicare requirements.
“Billing Medicare for unnecessary ambulance transports contributes to the soaring costs of health care,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division. “The Department of Justice is committed to pursuing companies that waste limited Medicare funds.”
“Medicare fraud is stealing, and it is crippling America’s health care system. We have doubled the number of attorneys working these cases in South Carolina. Take notice, if you are bilking the Medicare system designed to support our elders, we are working to find you. For the honest service providers, which is a greater majority of the community, you can report fraud at 1-800-MEDICARE,” said William N. Nettles, U.S. Attorney for the District of South Carolina.
The settlement resolves a lawsuit filed by Sandra McKee under the qui tam, or whistleblower provisions, of the False Claims Act. McKee is a clinical social worker at a facility that regularly received patients transported by Williston’s ambulances. Under the False Claims Act, private citizens can bring suit on behalf of the United States and share in any recovery. Ms. McKee will receive $160,000 as her share of the government’s recovery.
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 nearly $10.2 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 $14 billion.
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Source- http://www.justice.gov/usao/nys/pressreleases/February13/AymatRobertoPlea.php
Preet Bharara, the United States Attorney for the Southern District of New York, announced that Dr. ROBERTO AYMAT, a medical doctor, pled guilty today in Manhattan federal court to participating in a scheme to defraud Medicare out of approximately $8.5 million through the use of fraudulent HIV/AIDS clinics in New York. As part of the scheme, AYMAT and others billed Medicare for medications that were never administered or that were administered but were medically unnecessary. He pled guilty before U.S. District Judge George B. Daniels. Three other participants in the scheme, Asmed Barrera, Augusto Guzman, and Jorge Rivero, previously pled guilty.
Manhattan U.S. Attorney Preet Bharara said: “Roberto Aymat used his medical license to perpetrate a multi-million dollar fraud on Medicare – a program that provides a lifeline to its beneficiaries and that is struggling financially to stay afloat. His exploitation of this vital, taxpayer-funded program was egregious and with his plea today, he has been held to account.”
According to the Complaint and the Indictment filed in this case:
AYMAT, along with Barrera, Guzman, Rivero, also a medical doctor, and others operated three medical clinics in New York City that purported to provide drug treatments to Medicare-eligible HIV/AIDS patients, but that were, in reality, healthcare fraud mills.
The defendants executed the fraudulent scheme by recruiting HIV/AIDS patients eligible for Medicare, and paying them kickbacks in exchange for signing on as patients at the clinics. The defendants then used these patients’ status as Medicare beneficiaries to submit claims for reimbursement to Medicare for drugs that had been prescribed to these patients. In fact, these medications were never purchased and never administered, or were administered, but were medically unnecessary.
From January 2007 to April 2009, AYMAT and his co-conspirators billed Medicare for more than 10 times the number of units of prescription drugs they actually purchased, defrauding the Medicare system of at least $8.5 million.
AYMAT, 44, a resident of Manhattan, pled guilty to conspiring to commit fraud in connection with a health care benefits program, and to committing healthcare fraud and mail fraud. He faces a penalty of up to 50 years in prison and is scheduled to be sentenced by Judge Daniels on June 18, 2013.
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Source- http://www.fbi.gov/houston/press-releases/2013/local-businessman-convicted-in-19-million-health-care-fraud-scheme
HOUSTON—Joseph Edem, 53, of Richmond, has been convicted of conspiracy to commit health care fraud relating to medically unnecessary diagnostic testing and physical therapy, United States Attorney Kenneth Magidson announced today.
Edem was originally indicted with former doctor Donald Gibson, II, 56, of Sugarland. That indictment alleged Gibson ordered, prescribed, and authorized medically unnecessary diagnostic tests and other procedures which included allergy tests, pulmonary function tests, vestibular tests, urodynamic tests, and physical therapy, among others. These services were then billed to Medicare and Medicaid for payment under Gibson’s billing number, according to the indictment.
From January 2007 through January 2012, Gibson allegedly caused more than $19.4 million in medical claims to the Medicare and Texas Medicaid Programs. As a result, Medicare deposited approximately $8.5 million into a bank account owned and controlled by Gibson.
Edem operated medical clinics under the names of other individuals to conceal his financial interest in the businesses. Edem admitted today that he conspired to cause the submission of false claims to the Medicare and Medicaid programs and share in the proceeds. Edem admitted he paid patient recruiters for referring Medicare/Medicaid beneficiaries and also paid Medicare beneficiaries for showing up at the medical clinics.
U.S. District Court Judge Lynne N. Hughes, who accepted the guilty plea today, has set sentencing for May 28, 2013, at which time Edem faces up to 10 years in federal prison, as well as a possible $250,000 fine.
The case against Gibson is pending. He is presumed innocent unless and until convicted through due process of law.
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Source- http://www.justice.gov/usao/fls/PressReleases/130213-04.html
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, and Kathy Fernandez Rundle, State Attorney for Miami-Dade County, jointly announced the filing of a federal and state charges against defendant Kathryn Abbate, 64, of Hollywood, Florida.
Abbate is charged by Information in the federal case with theft of money from programs receiving federal funds, in violation of Title 18, United States Code, Section 666. If convicted, Abbate faces up to 10 years imprisonment, three years of supervised release, a fine of up to $250,000, and she may be ordered to pay restitution.
In the state case, Abbate is charged by Information with one count of an organized scheme to defraud and one count of grand theft in the first degree, in violation of Florida Statutes Sections 817.034(4)(a)1 and 812.014(2)(a). If convicted, Abbate faces up to 30 years imprisonment.
U.S. Attorney Wifredo A. Ferrer said “Holding accountable those who steal from the federal government for personal profit is one of my top priorities. Kathryn Abbate, the former CEO of the Miami Beach Community Health Center, was charged today with stealing federal funds from the most vulnerable among us – the sick, the elderly and the poor. We will not relent in our efforts to charge individuals who use the health care system to line their own pockets. Our investigation remains ongoing.”
Kathy Fernandez Rundle, State Attorney for Miami-Dade County, said “There is no excuse for the theft of funds intended to heal the sick and the poor of our community. Every stolen dollar took a part of a sick person’s future. I am gratified that the State Attorney’s Office, the United States Attorney’s Office and the Miami-Dade Office Inspector General were able to develop the evidence to charge the responsible individual and to help correct an oversight system that allowed this theft to happen.”
According to the Information filed in U.S. District Court, from 2008 to 2012, Abbate was the Chief Executive Officer of the Miami Beach Community Health Center (“MBCHC”). MBCHC was a federally qualified Health Center, which is a community-based organization that provides medical care to persons regardless of ability to pay, with locations in Miami Beach and North Miami, Florida. To carry out its mission, MBCHC was funded by federal, state, and local grants, as well as private donors. MBCHC received federal funds from the U.S. Department of Health and Human Services.
Furthermore, according to the Information filed in U.S. District Court, Abbate embezzled money from MBCHC when she obtained unauthorized compensation by causing MBCHC to issue unaccrued vacation pay to her that was not approved nor authorized by the Board of Directors. Abbate also caused MBCHC to disburse millions of dollars in over eight hundred checks made payable to her for “community development.” Funds from these checks were subsequently misappropriated by Abbate. Furthermore, Abbate knowingly provided fraudulent documentation to MBCHC’s auditors which falsely indicated that one million dollars of these funds were paid to five doctors. The aggregate value of the property under the care, custody and control of MBCHC that the defendant is charged with embezzling was several million dollars.
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Source- http://www.justice.gov/opa/pr/2013/February/13-civ-193.html
Fairfax, Va.-based skilled nursing facility Fairfax Nursing Center (FNC) and its owners have agreed to pay $700,000 to resolve allegations that they violated the False Claims Act by knowingly submitting or causing the submission to Medicare of false claims for non-reimbursable rehabilitation therapy services, the Justice Department announced today.
The settlement resolves claims that FNC provided excessive, medically unnecessary, or otherwise non-reimbursable physical, occupational, and speech therapy services to 37 Medicare beneficiaries serviced by FNC between January 2007 and December 2010. The United States alleged that the rehabilitation therapy services provided by FNC to these beneficiaries were not reasonable and necessary for the treatment of their condition. Specifically, the United States alleged that the therapy services were often excessive, duplicative, performed without clear goals or direction, and, in some instances, performed primarily to capture higher reimbursement rates.
“Today’s settlement is another example of the Department’s efforts to hold skilled nursing facilities accountable for the rehabilitation therapy services they deliver to some of the most vulnerable in our society,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. “The provision of excessive and medically unnecessary therapy services will not be tolerated.”
“Medicare fraud takes many forms and arises in various segments of health care,” said U.S. Attorney Neil H. MacBride. “We continue to work toward recovery of money lost to overbillings to Medicare.”
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 nearly $10.2 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 $14 billion.
The allegations settled today arose from a lawsuit filed by two former FNC therapists and one former contract therapist under the qui tam, or whistleblower provisions, of the False Claims Act. Under the False Claims Act, private citizens can bring suit on behalf of the United States and share in any recovery. The whistleblowers in this case will receive, collectively, $122,500 of the recovery. The lawsuit is captioned as United States of America & Commonwealth of Virginia ex rel. Christine Ribik, Nadine Kelly, & Stephanie Beauregard v. Fairfax Nursing Center, Inc., et al. , No. 1:11-cv-496 (E.D. Va.).
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Source- http://www.justice.gov/usao/nj/Press/files/Rand,%20Dov%20Sentencing%20News%20Release.html
NEWARK, N.J. – A New Jersey doctor practicing in West Orange was sentenced today to five months in prison and five months of home confinement for his role in a payment-for-patients scheme in which he took envelopes of cash in exchange for making patient referrals, U.S. Attorney Paul J. Fishman announced.
Dov Rand, 48, of Franklin Lakes, N.J., previously pleaded guilty before U.S. District Judge Claire C. Cecchi to one count of violating the federal healthcare program anti-kickback statute. Judge Cecchi imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
On Dec. 13, 2011, Rand was arrested – along with 12 other New Jersey doctors and one nurse practitioner – and charged with accepting cash kickback payments from Orange Community MRI (“Orange MRI”), an Orange, N.J., diagnostic facility, in exchange for his referral of Medicare and Medicaid patients. During the course of the investigation, Rand and others were recorded taking envelopes of cash in exchange for their patient referrals. Orange MRI’s executive director, Chirag Patel, 37, of Warren, N.J., was arrested on Dec. 8, 2011, in connection with the scheme.
Starting in 2010, Orange MRI made monthly cash kickback payments to Rand in exchange for his referral of patients to Orange MRI for diagnostic tests. At the end of each month, individuals at Orange MRI printed patient reports that detailed how many tests Rand referred and used them to calculate the kickback payment owed to Rand. Pursuant to Rand’s agreement with Orange MRI, he was paid kickbacks for each MRI test on a Medicare or Medicaid beneficiary referred to the facility.
Rand admitted receiving cash payments on more than one occasion in October and November 2011 in exchange for his referral of patients.
In addition to the prison term and home confinement, Judge Cecchi sentenced Rand to two years of supervised release and fined him $30,000.
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Source- http://www.justice.gov/opa/pr/2013/February/13-crm-181.html
A former registered nurse was sentenced today to serve 111 months in prison for his role in a health care fraud scheme involving defunct health provider Health Care Solutions Network Inc. (HCSN), announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
John Thoen, 53, of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. In addition to his prison term, Thoen was sentenced to serve three years of supervised release.
On Nov. 20, 2012, Thoen pleaded guilty in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.
According to court documents, HCSN operated community mental health centers (CMHC) at three locations in Miami-Dade County, Fla., and one location in Hendersonville, N.C. HCSN purported to provide partial hospitalization program (PHP) services to individuals suffering from mental illness. A PHP is a form of intensive treatment for severe mental illness. According to court documents, HCSN obtained Medicare beneficiaries to attend HCSN for purported PHP treatment that was unnecessary and, in many instances, not even provided. HCSN obtained those beneficiaries in Miami by paying kickbacks to owners and operators of assisted living facilities.
According to court documents, Thoen was a licensed registered nurse in both Florida and North Carolina. In Florida, Thoen participated in the admission to HCSN of patients who were ineligible for PHP services. Thoen participated in the routine fabrication of patient medical records that were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Medicaid.
In North Carolina, Thoen, according to court documents, routinely submitted fraudulent PHP claims for Medicare patients who were not even present at the CMHC on days PHP services were purportedly rendered. Thoen also caused the submission of fraudulent Medicare claims on days the CMHC was closed due to snow.
Thoen also admitted to his role in a money laundering scheme, involving Psychiatric Consulting Network Inc. (PCN), a Florida corporation that was utilized by HCSN as a shell corporation to launder health care fraud proceeds. According to court documents, Thoen was president of PCN.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.
Fifteen defendants have been charged for their alleged roles in the HCSN health care fraud scheme, and nine defendants have pleaded guilty. Alleged co-conspirators Wondera Eason and Paul Layman are scheduled for trial on March 11, 2013, before Judge Altonaga in Miami. And alleged co-conspirators Alina Feas, Dana Gonzalez, Gema Pampin and Lisset Palmero are scheduled for trial on June 3, 2013. Defendants are presumed innocent until proven guilty at trial.
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Source- http://www.justice.gov/opa/pr/2013/February/13-civ-183.html
Steven J. Wasserman, M.D., a dermatologist practicing in Venice, Fla., has agreed to pay $26.1 million to resolve allegations that he violated the False Claims Act by accepting illegal kickbacks from a pathology laboratory and by billing the Medicare program for medically unnecessary services, the Justice Department announced today. The settlement is the largest ever with an individual under the False Claims Act in the Middle District of Florida and one of the largest with an individual under the False Claims Act in U.S. history.
The government alleged that, in or around 1997, Dr. Wasserman entered into an illegal kickback arrangement with Tampa Pathology Laboratory (TPL), a clinical laboratory in Tampa, Fla., and Dr. José SuarezHoyos, a pathologist and the owner of TPL, in an effort to increase the lab’s referral business. Under that agreement, Dr. Wasserman allegedly sent biopsy specimens for Medicare beneficiaries to TPL for testing and diagnosis. In return, TPL allegedly provided Dr. Wasserman a diagnosis on a pathology report that included a signature line for Dr. Wasserman to make it appear to Medicare that he had performed the diagnostic work that TPL had performed. The government alleged that Dr. Wasserman then billed the Medicare program for TPL’s work, passing it off as his own, for which he received more than $6 million in Medicare payments. In addition, the government asserted that, in furtherance of his agreement with TPL, Dr. Wasserman substantially increased the number of skin biopsies he performed on Medicare patients, thus increasing the referral business for TPL.
The government further alleged that, in addition to his involvement in the alleged kickback scheme, Dr. Wasserman also performed thousands of unnecessary skin surgeries known as adjacent tissue transfers on Medicare beneficiaries. Adjacent tissue transfers are complicated and often time-consuming procedures physicians sometimes use to close a defect resulting from the removal of a growth on a patient’s skin. The government
alleged that Dr. Wasserman performed many of these procedures in order to obtain the reimbursement for them, and not because they were medically necessary.
“Doctors who take illegal kickbacks and perform unnecessary procedures not only put their own financial self-interest over their duty to their patients, they raise the cost of health care for all of us as patients and as taxpayers,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. “The Department of Justice will not tolerate those who abuse the public health care programs to which we all contribute and on which we all depend.”
“This settlement represents a watershed achievement in our district’s civil healthcare fraud enforcement program,” said Robert O’Neill, U.S. Attorney for the Middle District of Florida. “Schemes of this magnitude require extraordinary remedies, and we are proud to have reached such an outstanding resolution for the taxpayers and their health programs.”
The allegations resolved by today’s settlement were initiated by a lawsuit originally filed in the District Court for the Middle District of Florida by Alan Freedman, M.D., a pathologist who formerly worked at TPL. Dr. Freedman filed the lawsuit under the qui tam, or whistleblower provisions of the False Claims Act. Under the False Claims Act, a private party may file suit on behalf of the United States for false claims and share in any recovery. The United States has the right to intervene in the action, which it did in this case, filing its own complaint in October 2010. Dr. Freedman will receive $4,046,000 of today’s settlement.
The United States previously settled with TPL and Dr. SuarezHoyos for $950,000 to resolve the allegations asserted against them in the same lawsuit.
“Anyone cheating patients and taxpayers should expect to pay a high price,” said Daniel R. Levinson, Inspector General of the U.S. Department of Health and Human Services. “Besides paying more than $26 million, Dr. Wasserman is excluded from treating patients and being paid under Medicare, Medicaid and all other federal health care programs.”
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Source- http://www.justice.gov/usao/nys/pressreleases/February13/KazarianArmenSentencingPR.php
Preet Bharara, the United States Attorney for the Southern District of New York, announced that ARMEN KAZARIAN was sentenced today in Manhattan federal court to 37 months in prison for his involvement with the Mirzoyan-Terdjanian Organization, an Armenian-American organized crime enterprise engaged in a wide range of criminal activity. KAZARIAN pled guilty to racketeering conspiracy in July 2011, and was sentenced today by U.S. District Judge Paul G. Gardephe.
Manhattan U.S. Attorney Preet Bharara said: “Armen Kazarian sat at the top of a criminal organization and now he will sit in a jail cell for a long time. International mobsters who think they can export their criminal enterprises to the United States and target our government programs and our citizens are in for a rude awakening – they will face U.S. justice and be made to answer for their crimes.”
According to the Indictment, other documents filed in this case, and statements made during the guilty plea proceeding:
KAZARIAN was a “Vor,” a term translated as “Thief-in-Law.” The term refers to a member of a select group of high-level criminals from Russia and the countries that had been part of the former Soviet Union, including Armenia. “Vors” offer prestige and protection to criminal organizations in return for a share of criminal earnings, and use their position of authority to resolve disputes among criminals. KAZARIAN used his status as a “Vor” within the criminal community to assist the Mirzoyan-Terdjanian Organization, an Armenian-American organized crime ring that engaged in an extensive range of criminal offenses including the operation of a $100 million dollar Medicare fraud billing ring. As part of his involvement with the group, KAZARIAN engaged in extortion on the Organization’s and his own behalf.
* * *
In addition to the prison term, Judge Gardephe sentenced KAZARIAN, 47, of Glendale, California, to three years of supervised release. He was also ordered to pay a $60,000 fine.
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Source- http://www.justice.gov/usao/ncw/pressreleases/2013/Charlotte-2013-02-11-garnes.html
CHARLOTTE, N.C. – A federal jury sitting in Charlotte convicted a Charlotte woman late Friday, February 8, 2013 of defrauding Medicaid of at least $650,000, obstructing an official proceeding and making false statements in connection with a health care matter, 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), 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.
Charlotte Elizabeth Garnes, 37, of Charlotte was convicted following a weeklong trial before U.S. District Court Judge Frank D. Whitney. According to evidence presented at trial, Garnes was a Licensed Professional Counselor and was approved by Medicaid to provide mental and behavioral health services to qualified individuals. The Government’s evidence showed that Garnes claimed to have personally provided mental health services to Medicaid recipients when in fact she did not. Instead, as evidence established, the defendant conspired with others – who were not licensed and not approved by Medicaid – to permit those unqualified individuals to submit claims to Medicaid under the Defendant’s provider number for therapy services purportedly provided by those individuals. In reality, most of the services were never provided.
According to evidence presented at trial, Garnes agreed with Teresa Marible, Michele Jackson (a/k/a Sylvia Jackson) and others to falsely put Garnes’ name and Medicaid provider number on claims for therapy services supposedly provided by the co-conspirators. The Government established that after Medicaid paid Garnes for these false claims, Garnes kept 30% of the fraud proceeds and distributed the remainder to her co-conspirators. From March 2009 to April 2011, Medicaid paid the Defendant and her company, Charlotte’s Insight, Inc., approximately $740,349 and approximately 90% of that amount ($666,062) was based upon false claims for services that Garnes did not provide.
During trial, the Government established that many of the claimed services were never provided at all. Numerous Medicaid recipients or their parents testified at trial that they or their children never received the therapy services that Garnes claimed to have provided. For many of the claimed dates of services Garnes was not in North Carolina or in the country. In fact, the defendant billed Medicaid for therapy services she claimed to have provided while she was in Germany working on a government contract, all according to trial evidence. The evidence also established that Garnes routinely billed for more than 24 hours of therapy services in a single day, including allegedly providing 69 hours of individual therapy services in a single day in December 2009.
Trial evidence demonstrated that the Defendant purchased a Mercedes vehicle and plastic surgery with the fraud proceeds.
Garnes, who was convicted on all twelve counts charged in the indictment, has been released on bond. She 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. Counts three through twelve carry a statutory maximum sentence of five years in prison and a $250,000 fine. A sentencing date for Garnes has not been set yet.
Teresa 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. Michele Jackson was sentenced in March 2012 to 15 months in prison and was ordered to pay $292,282 in restitution.
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Source- http://www.justice.gov/opa/pr/2013/February/13-civ-169.html
St. Joseph’s Medical Center, a hospital located in Towson, Md., has reached a settlement with the United States to pay $4.9 million in connection with its submission of false claims to Medicare, Medicaid and other federal healthcare programs, the Justice Department announced today.
This settlement resolves the hospital’s civil liability to the United States under the False Claims Act for the hospital’s disclosure that from 2007-2009 it engaged in a practice of admitting patients to the hospital unnecessarily. In particular, the hospital disclosed that it admitted patients for short stays – typically one or two days – that were not warranted by the patient’s medical condition, and thereby generated a larger reimbursement than was proper for each patient. Of the $4.9 million to be paid by St. Joseph’s, $4.6 million will go the United States, and $152,406 will go to the state of Maryland, which is also a party to the agreement.
“The improper admission of patients for the purpose of obtaining increased reimbursement is a significant drain on the resources of federal and state healthcare programs,” said Stuart F. Delery, Principal Deputy Assistant Attorney General of the Justice Department’s Civil Division. “This recovery reflects the Department’s continuing efforts to safeguard federal funds.”
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 $10.2 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 $14 billion.
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Source- http://www.justice.gov/usao/nj/Press/files/HHCH%20Health%20Care%20Arrests%20News%20Release.html
NEWARK, N.J. – Federal and state agents this morning arrested 11 people who are charged by Complaint, along with two corporations, in connection with a large-scale scheme to defraud the Medicaid program of millions of dollars, U.S. Attorney Paul J. Fishman announced today.
The Complaint also charges the owner of a home health aide business headquartered in Linden, N.J., with attempting on two occasions to hinder a state investigation by bribing a state regulator – who was working with the FBI – and with conspiring with the owner of another home health aide business in Elizabeth, N.J., to launder money.
The defendants arrested this morning are scheduled to appear this afternoon before U.S. Magistrate Judge Madeline Cox Arleo in Newark federal court.
“The defendants in this case allegedly enriched themselves by gaming the Medicaid system,” U.S. Attorney Fishman said. “The actions described in this Complaint are especially egregious, because the taxpayer dollars that were stolen were intended to provide necessary health care for our most vulnerable citizens. I’m especially proud that federal and state law enforcement agencies worked together effectively to uncover this alleged fraud.”
David Velazquez, Acting Special Agent in Charge of the FBI, Newark, said, “The FBI views health care fraud as a severe crime problem that poses a potential risk to patients and increases health care costs for all. Today's arrests are the result of a four-year investigation into a sophisticated scheme, involving multiple layers of fraud, money laundering and bribery, in order to defraud the New Jersey Medicaid program of millions of dollars. This case is indicative of how the FBI, along with its federal partners, and the State of New Jersey, will continue to work together to pursue those that steal from our health care system.”
“Falsely billing Medicaid for millions of dollars as alleged in today’s Complaint is a serious crime,” IRS-Criminal Investigation Acting Special Agent in Charge Shantelle P. Kitchen, Newark Field Office, said. “Financial fraud schemes such as this are often described as a house of cards. The underlying structure can fall apart at any time and expose the individuals responsible. “IRS-Criminal Investigation is committed to unraveling complex financial transactions and money laundering schemes where individuals attempt to conceal the true source of their money.”
New Jersey Attorney General Jeffrey Chiesa said: “The New Jersey Division of Consumer Affairs regulates nurses, home health aides, and home health agencies in our state, and the Division's Enforcement Bureau aggressively investigates any allegations of fraud or wrongdoing by those regulated professionals and businesses. We are proud to have worked with the FBI on this investigation. Alleged billing fraud by health professionals affects the entire economy, and will not be tolerated.”
According to the Complaint filed in this case:
Irina Krutoyarsky, 58, of Springfield, N.J., was the owner and operator of HHCH Health Care Inc. (HHCH), a for-profit home health aide business located in Linden. HHCH billed Medicaid for services purportedly provided by home health aides to Medicaid-eligible patients. Medicaid is a jointly funded, federal-state health insurance program that provides certain health benefits to the disabled and individuals and families with low incomes and resources. Paul Mil, 68, of Springfield, was the owner and operator of People Choice Home Care Inc. (People Choice), another for-profit home health business located in Linden and Elizabeth, which also billed Medicaid for services purportedly provided by home health aides.
Krutoyarsky, Mil and their conspirators allegedly defrauded Medicaid of millions of dollars through a variety of schemes, including:
● billing Medicaid for treatment and services not actually rendered;
● obtaining fraudulent home health aide certifications for employees and others;
● using illegal aliens and/or non-certified individuals to provide home health aide services and billing Medicaid, claiming the services had been provided by certified home health aides.
According to the Complaint:
During the investigation, an individual working with the FBI – “Cooperating Witness Three” (CW3) – met Krutoyarsky, Mil, and others at HHCH and consensually recorded a number of conversations. For example, on Jan. 31, 2012, CW3 met with Krutoyarsky and Mil to discuss obtaining a home health aide license. During this consensually recorded conversation (audio and video), they discussed fraudulently billing Medicaid providing false information about the patients, known as a “bait and switch:”
Krutoyarsky: You know, it's just the free money . . . coming in.
CW3: That's true.
Mil described how they billed Medicaid for services not actually rendered:
Mil: It’s a lot of people, a lot of people who . . . Medicaid. Government pay for the service. We can get, you know, between 10 and 18 hours [of Medicaid billing per week per patient]. Look, people can work in a week and get paid hundred bucks a week doing nothing. Why not?
* * * *
Krutoyarsky: . . . But as long as these people doesn't live in the same address, so Medicaid is not gonna trace.
CW3: Oh, so otherwise they will trace. Okay.
Krutoyarsky: Because they do the tracings, you know. They gonna see who's working, who's not working, this and that. . . . So this way, they gonna have a free money. . . . Government, free money.
After meeting with Krutoyarsky and Mil, CW3 met with defendant Nekadam S. Galibova, an HHCH office employee, who assisted CW3 in obtaining a home health aide license without taking the required course or test. CW3 underwent neither the required training nor testing, but in March 2012, CW3 received a home health aide license from the New Jersey. Krutoyarsky, Mil, and others billed Medicaid under CW3’s license, knowing that CW3 provided no treatment to any patients.
Galibova was also a purported HHCH home health aide. The investigation revealed that she conspired with Krutoyarsky and others to bill Medicaid for services not rendered. Galibova and HHCH billed Medicaid for a patient (referred to as Patient M.N.) from July 27 to 31, 2009, and August 3 to 4, 2009, periods when that patient was, in fact, out of the country.
Krutoyarsky and Mil also dispatched undocumented aliens and other unlicensed individuals to patients’ homes. Defendant Sonia Mesa was observed by the FBI visiting a patient’s home, however, Medicaid was billed using the names of others, including Alla Neymet and Leonora Popesku.
Krutoyarsky also bribed a N.J. Department of Labor employee on two occasions to stop wage and hour investigations into HHCH and People Choice. This state employee, however, was cooperating with the FBI and is referred to in the Complaint as “Cooperating Witness Two” (CW2). On June 14, 2010, Krutoyarsky met CW2 about the state investigation into HHCH. Krutoyarsky did not want to provide CW2 with records related the HHCH and handed CW2 an envelope containing approximately $1,000 in cash.
Krutoyarsky and CW2 passed notes back and forth, negotiating the bribe. Eventually, Krutoyarsky agreed to pay CW2 $10,000, which she later paid. On April 14, 2011, Krutoyarsky paid another $15,000 to CW2 to subvert a state investigation into People Choice.
Krutoyarsky and Mil then allegedly laundered the proceeds of the Medicaid fraud to conceal their scheme and allow it to continue. Krutoyarsky and defendant Gulmira Shayakhmetova are alleged to have conspired to structure money, by making numerous cash withdrawals in amounts under $10,000, to evade the banks requirement to file a report with the United States Treasury.
Count One charges conspiracy to commit health care fraud and carries a maximum penalty of 20 years in prison and a $250,000 fine. Counts Two and Three each charge bribery, and each charge carries a maximum penalty of 10 years in prison and a $250,000 fine. Count Four charges conspiracy to commit money laundering and carries a maximum penalty of 20 years in prison and a $500,000 fine. Count Five charges conspiracy to unlawfully structure financial transactions and carries a maximum penalty of five years in prison and a $250,000 fine.
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Source- http://www.justice.gov/usao/ct/Press2013/20130131.html
David B. Fein, United States Attorney for the District of Connecticut, today announced that JAMES P. RALABATE, MD, a physician, and his professional corporation, PRIMARY CARE ASSOCIATES P.C., which is located at 2890 Main Street in Stratford, have entered into a civil settlement with the government in which they will pay $700,000 to resolve allegations that RALABATE violated the False Claims Act.
The allegations against RALABATE involve fraudulent billing to Medicare occurring over a five-year period for medical services allegedly provided at various nursing homes in Connecticut. The government alleges that RALABATE billed Medicare for high-level physician services when the services of a physician were not medically necessary. The medical records did not provide documentation necessary to meet the detailed history, examination or medical decision-making requirements necessary to justify the high level of physician care. At times, there was no medical record documenting RALABATE’s visit.
The government further alleges that RALABATE billed Medicare for services he supposedly provided to patients in nursing homes when the patients were, in fact, not present in the nursing homes. Instead, the patients had been transferred to local hospitals for treatment. Yet RALABATE billed government health care programs as if he had provided medical services in the nursing homes.
To resolve their liability under the False Claims Act, RALABATE and his professional corporation will pay $700,000 in order to reimburse the Medicare programs for conduct occurring between January 1, 2006 and August 31, 2011.
In addition, RALABATE has agreed to be subject to an Integrity Agreement with the Office of Inspector General for the U.S. Department of Health and Human Services.
“Health care providers that overcharge Medicare drain critical funds from the Medicare program and increase health care costs,” U.S. Attorney Fein stated. “The U.S. Attorney’s office is committed to vigorously pursuing physicians and other health care providers who submit fraudulent claims to federal health care programs. Providers who submit false claims to the government face serious monetary and administrative sanctions.”
Under the False Claims Act, the government can recover up to three times its actual damages, plus penalties of $5,500 to $11,000 for each false claim.
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Source- http://www.justice.gov/usao/txn/PressRelease/2013/JAN2013/jan30leong_hcf_plea.html
DALLAS — On the day his trial was to begin in U.S. federal court, Dr. Daniel K. Leong, 59, who owned South Dallas Community Medical Center (SDCMC) on Martin Luther King Blvd., in Dallas, pleaded guilty to one count of conspiracy to commit health care fraud. Leong, who is in federal custody, faces a maximum penalty of five years in federal prison, a $250,000 fine and restitution. Sentencing is set for May 1, 2013, before U.S. District Judge Ed Kinkeade.
Leong’s co-conspirator, Cal Graves, who worked as a physician assistant at the SDCMC, pleaded guilty in July 2012 to the same offense. He is scheduled to be sentenced by Judge Kinkeade on February 13, 2013.
According to plea documents filed in the case, from February 2010 to February 2011, Leong and Graves engaged in a conspiracy to defraud Medicare and Medicaid by falsely representing that office visits and diagnostic tests were medically necessary.
PIn exchange for submitting themselves to diagnostic tests, patients at the clinic were prescribed controlled substances. This ensured that the patients would return to the clinic the next month, thus making themselves available for more tests. Often, patients would exaggerate their pain level to provide a basis for a prescription for narcotics. Leong benefitted from the exaggeration because this gave him “cover” to order more tests. The patients were rarely referred to specialists for their persistent pain and this process was repeated for up to several years without any actual treatment for some patients.
Leong and Graves frequently ordered tests known as electromyograms (EMG), which are used to diagnose neurological and nueromuscular problems. These tests are also highly-reimbursable by Medicare and Medicaid. Often, the results of these tests were never read and Graves did not have the proper training to read them.
In addition, in February 2010, Leong signed a blank prescription that reflected Leong’s authority to prescribe controlled substances. Leong instructed Graves and other SDCMC staff to copy this prescription as needed. When patients came to SDCMC, Graves used the pre-signed prescriptions.
Medicare and Medicaid would not have paid claims for office visits, diagnostic testing, or prescriptions if they had known either that the services were medically unnecessary and that Leong did not prescribe the medications.
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Source- http://www.justice.gov/usao/mow/news2013/mccarty.sen.html
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a psychologist practicing in the Lebanon, Mo., area was sentenced in federal court today for engaging in a $1 million scheme to defraud Medicare and Medicaid.
“Those who defraud the government are stealing from the pockets of law-abiding taxpayers,” Dickinson said. “This psychologist flagrantly abused the system to enrich himself for more than three years, but today he is being held accountable for his actions.”
Rhett E. McCarty, 67, of Lake Ozark, Mo., was sentenced by U.S. District Judge Howard F. Sachs to three years in federal prison without parole. The court also ordered McCarty to pay $1 million in restitution to Medicaid and Medicare.
McCarty was a licensed psychologist and private practitioner who provided psychotherapy services to recipients of both Medicare and Medicaid in their homes in the Lebanon area. On Aug. 16, 2012, McCarty pleaded guilty to health care fraud and to forgery.
“Rhett McCarty violated the trust extended to him by the American taxpayers to provide medical services to our Medicare and Medicaid beneficiaries,” said Special Agent in Charge Gerry Roy of the Health and Human Services – Office of Inspector General. “He is now being held responsible for his violations. At HHS-OIG, we will continue to work with our federal and state law enforcement and prosecution partners to ensure the solvency and integrity of our federally-funded health care programs.”
Between Sept. 17, 2008, and April 5, 2012, McCarty submitted Medicare and Medicaid claims for daily or near daily psychotherapy services to 19 beneficiaries for which he was paid $1,276,334. According to the claims that McCarty submitted, he routinely saw beneficiaries seven days per week and worked long hours every day. Moreover, according to McCarty’s claims, he worked every single day of the calendar year from mid-September 2008 through early April 2012, except for Christmas day. McCarty routinely billed for every weekend day and for all holidays except Christmas day.
Although McCarty did provide some services for most of these beneficiaries, he admitted that he did not see those beneficiaries more than once a week. McCarty also admitted that the amount he was paid by Medicare and Medicaid for services he did not provide to these 19 beneficiaries was $1 million.
McCarty also admitted that he forged (or caused another person to forge) the signatures of five of the beneficiaries on patient sign-in sheets in order to obtain $418,507 in Medicare and Medicaid payments.
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