Source- http://www.justice.gov/opa/pr/2013/April/13-civ-438.html
Amgen Inc., a California-based biotechnology company, has agreed to pay the United States $24.9 million to settle allegations that it violated the False Claims Act, the Justice Department announced today. Amgen develops, manufactures, and sells pharmaceutical products, including products sold under the trade name Aranesp.
The settlement resolves allegations that Amgen paid kickbacks to long-term care pharmacy providers Omnicare Inc., PharMerica Corporation and Kindred Healthcare Inc. in return for implementing “therapeutic interchange” programs that were designed to switch Medicare and Medicaid beneficiaries from a competitor drug to Aranesp. The government alleged that the kickbacks took the form of performance-based rebates that were tied to market-share or volume thresholds. The government further alleged that, as part of the therapeutic interchange program, Amgen distributed materials to consultant pharmacists and nursing home staff encouraging the use of Aranesp for patients who did not have anemia associated with chronic renal failure.
“We will continue to pursue pharmaceutical companies that pay kickbacks to long-term care pharmacy providers to influence drug prescribing decisions,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. “Patients in skilled nursing facilities deserve care that is free of improper financial influences.”
“By this agreement we are making important strides in holding drug manufacturers accountable for fraudulent and abusive practices not only in South Carolina but nationwide,” said William Nettles, U.S. Attorney for the District of South Carolina. “I am proud of the tireless work of this office to investigate this case across the country.”
This civil settlement resolves a lawsuit filed under the qui tam, or whistleblower, provision of the False Claims Act, which allows private citizens with knowledge of false claims to bring civil actions on behalf of the United States and share in any recovery. The False Claims Act suit was filed in the U.S. District Court for the District of South Carolina, and is captioned United States ex rel. Kurnik v. Amgen Inc., et al.
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Source- http://www.fbi.gov/losangeles/press-releases/2013/san-fernando-valley-doctor-who-pled-guilty-in-3-million-medicare-fraud-case-sentenced-to-more-than-three-years-in-federal-prison
LOS ANGELES—A medical doctor who owns a cosmetic medicine clinic in the Winnetka district of the San Fernando Valley has been sentenced to 42 months in federal prison for bilking Medicare out of more than $3 million by submitting bills for procedures he never performed.
Pezhman Ebrahimzadeh, who uses the name “Pez Abrahams,” 50, of Calabasas, received the three-and-a-half-year sentence yesterday from United States District Judge George H. Wu.
In addition to the prison term, Judge Wu ordered Ebrahimzadeh to pay $3,184,000 in restitution, most of which is to be paid to the Medicare program.
Ebrahimzadeh owns the Winnetka Medical Group, a cosmetic health care clinic that operates under the name Health & Beauty Clinic. At his clinic, Ebrahimzadeh provides cosmetic treatments that involve radiofrequency lasers and liposuction. As some of his patients were Medicare beneficiaries, Ebrahimzadeh obtained their beneficiary information, which was used to bill Medicare for procedures he did not perform.
Ebrahimzadeh also obtained beneficiary information for patients he never met or treated, and he used that information to submit other fraudulent bills to Medicare.
In relation to the bogus bills submitted to Medicare, Ebrahimzadeh typically claimed he had performed three expensive procedures: revascularization, ablation of a bone tumor, or the placement of a radiotherapy catheter in a breast. Ebrahimzadeh made these claims even though he lacked the equipment needed to perform revascularizations or the placement of radiotherapy catheters.
Ebrahimzadeh’s “conduct was so brazen that he billed Medicare for purportedly performing dozens of procedures on patients who were dead,” prosecutors wrote in a sentencing memorandum to the court. “For one such patient, defendant billed Medicare for seven separate high-paying procedures. [Ebrahimzadeh] also altered medical records in an attempt to conceal his fraudulent conduct. In addition to defrauding Medicare, defendant billed private insurance carriers for similar procedures, some of which he claimed he performed on himself.”
Between September 2008 and April 2012, Ebrahimzadeh submitted $7.5 million in bogus claims, and Medicare paid just over $3 million.
Ebrahimzadeh pleaded guilty in January to one count of health care fraud.
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Source- http://www.justice.gov/usao/iln/pr/chicago/2013/pr0416_01.html
CHICAGO – The owner and another senior executive of Sacred Heart Hospital and four physicians affiliated with the west side facility were arrested today for allegedly conspiring to pay and receive illegal kickbacks, including more than $225,000 in cash, along with other forms of payment, in exchange for the referral of patients insured by Medicare and Medicaid to the hospital.
Agents from the FBI and the U.S. Department of Health and Human Services Office of Inspector General today also began executing search and seizure warrants in connection with an ongoing investigation of alleged Medicare and Medicaid fraud schemes at the hospital involving emergency room evaluation, testing and observation services that were not medically necessary, as well as medically unnecessary sedation, intubation and tracheotomy procedures performed on patients. Approximately $2 million in Medicare reimbursement payments was seized today from various bank accounts.
Arrested were EDWARD J. NOVAK, 58, of Park Ridge, Sacred Heart’s owner and chief executive officer since the late 1990s; ROY M. PAYAWAL, 64, of Burr Ridge, executive vice president and chief financial officer since the early 2000s; and Drs. VENKATESWARA R. “V.R.” KUCHIPUDI, 66, of Oak Brook, PERCY CONRAD MAY, JR., 75, of Chicago, SUBIR MAITRA, 73, of Chicago, and SHANIN MOSHIRI, 57, of Chicago.
Sacred Heart Hospital is a 119-bed acute care facility located at 3240 West Franklin Blvd., in Chicago. Approximately 40 in-patients were in the hospital this morning, and representatives of the HHS Centers for Medicare and Medicaid Services (CMS) were on site and coordinating with the Illinois Department of Healthcare and Family Services to ensure continuity of patient care.
“These charges and the affidavit’s other allegations outline a kickback conspiracy to bribe doctors to refer patients to Sacred Heart where they would be treated in in an environment in which the quality of care and appropriate medical analysis were less important than maximizing the numbers of patients funneled into the hospital,” said Gary S. Shapiro, United States Attorney for the Northern District of Illinois.
“The payment of kickbacks or bribes in exchange for the referral of Medicare or Medicaid patients, regardless of the form in which they are paid, is a crime,” said Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of HHS-OIG. “The Office of Inspector General will continue to work closely with our law enforcement partners to aggressively investigate alleged illegal patient referral schemes and hold accountable those who seek to exploit vulnerable patients and the Medicare and Medicaid programs.”
“Today’s arrests demonstrate our commitment to enforcing the laws intended to prevent abuses of the Medicare and Medicaid programs and to preserve the ability of those programs to provide appropriate medical services to the elderly and the needy,” said Cory B. Nelson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of investigation.
The defendants were charged in a complaint that was filed yesterday and unsealed today after the arrests. All six defendants were scheduled to appear beginning at 3 p.m. before U.S. Magistrate Judge Daniel Martin in Federal Court.
Kickback Conspiracy
A 90-page affidavit in support of the criminal complaint and search and seizure warrants states that former Sacred Heart Physician A began cooperating in the investigation in October 2011, and Administrator A and Administrator B began assisting in January 2013 and February 2012, respectively. Each of them made consensual recordings of meetings and telephone conversations with other executives, administrators, physicians and employees that are described in the affidavit.
According to the complaint – at Novak’s direction and with his approval and Payawal’s assistance – Sacred Heart implemented a scheme to pay kickbacks to physicians in return or referrals of Medicare and Medicaid patients. Novak and Payawal allegedly tried to conceal the scheme by masking payments as fictitious rental payments; paying the salaries of physicians’ employees; providing physicians ghost contracts for duties without any real responsibilities; creating alternative billing arrangements; and purporting to pay physicians to supervise and teach non-existent medical students.
In a conversation that Administrator A recorded on Feb. 28, 2013, Novak and Payawal allegedly identified Drs. Moshiri, Maitra and May as physicians receiving regular kickback payments who Administrator A should pay.
Between January 2010 and February 2013, May allegedly received $74,000 in the form of 37 checks, for $2,000 each, disguised as “rental payments”; Moshiri, a podiatrist, allegedly received $86,000 in 38 checks pursuant to a purported contract to teach podiatry students; and Maitra allegedly received $68,000 in 34 checks pursuant to a purported teaching contract – and the $228,000 total in alleged kickbacks were all in exchange for their referral of patients to Sacred Heart, the charges allege.
In a recorded conversation last month, Maitra allegedly explained to Administrator A that he used to make Novak “so much money” performing almost daily penile implant procedures on patients, but that he no longer performed as many of those procedures because Medicare had decreased its rates of reimbursement for the procedure. Maitra did not comment on whether the patient need for the procedure had somehow changed, according to the affidavit.
Regarding Dr. Kuchipudi, Administrator A told agents that he was one of Sacred Heart’s most prolific patient referral sources and, according to Physician A, was known within the hospital as the “king of nursing homes.” According to Administrator A, Sacred Heart paid Kuchipudi for Medicare patient referrals in two ways: first, by paying most of the salaries of a physician’s assistant and a registered nurse who were effectively employed by Kuchipudi, and second, by paying Physician B for treating Kuchipudi’s patients at Sacred Heart, despite the fact that Kuchipudi, and not the hospital, billed insurers for the services Physician B provided to those patients. These arrangements allegedly benefited Kuchipudi as a result of the hospital absorbing employee salary costs that Kuchipudi would normally have to pay himself.
Emergency Room Admissions
Although not charged, the affidavit supporting the search warrant states that the investigation extends to allegations of unnecessary emergency room admissions. Administrator A told agents that Novak ignored numerous complaints that physicians admit patients who do not require hospitalization, and that certain physicians have subjected patients to unnecessary medial testing and procedures in an attempt to justify the patients’ admissions and to increase billing.
Insiders have told agents that Sacred Heart’s executives established a system to admit nursing home patients, irrespective of any medical necessity, by directing referring physicians to use ambulance companies with which Sacred Heart has had “a relationship.” By designating such patients as “direct admission,” Sacred Heart physicians are able to transfer their patients by ambulance from nursing homes, regardless of the proximity to the hospital. Instead of directly admitting these nursing home patients, however, Sacred Heart processes them through its emergency room, billing Medicare for emergency care, which is usually not medically necessary, according to Administrator A. Physician A told investigators that, in his experience, half of the patients presented to Sacred Heart’s ER already had a relationship with one of the hospital’s attending physicians and that the majority of those patients were admitted to the hospital from the emergency room.
Tracheotomy Procedures
The investigation is also probing claims that Sacred Heart Physician D, a pulmonologist, allegedly performs a high number of unnecessary intubations and prolongs them by directing heavy sedation of his patients, often resulting in tracheotomies being performed by Sacred Heart surgeons that may not have been medically necessary. Administrator A told agents that during a lunch with Novak and Payawal in December 2012, they both explained that tracheotomy cases provide substantial insurance reimbursement income for the hospital. On March 1, 2013, Administrator A recorded Novak stating that tracheotomies are Sacred Heart’s “biggest money maker” and the hospital can make $160,000 for a tracheotomy if the patient stays 27 days. On March 7, 2013, the Intensive Care Unit case manager told Administrator A that she must often “stretch” a tracheotomy patient’s stay to 28 days to maximize Medicare reimbursements “to make Novak happy.”
According to the affidavit, Sacred Heart allegedly conceals $7,000 monthly payments for respiratory patient referrals by paying that amount to a healthcare management company that has an employee who works at one of the nursing homes where Kuchipudi sees patients. The consulting firm employee works with Kuchipudi, nursing homes, and Sacred Heart to facilitate the admission of respiratory patients to Sacred Heart, Administrator A told investigators.
On March 4, 2013, investigators from CMS and the State of Illinois arrived at Sacred Heart to conduct an investigation of the hospital’s intubations and tracheotomies, and quality assurance and performance improvement protocols. On March 6, Administrator A recorded Physician D acknowledging that Sacred Heart lacked policies for various aspects of intubations and tracheotomies and that he had given some practice guidelines and procedures obtained from other hospitals to the surveyors in response to their request for Sacred Heart’s policies. At the same time, the ICU nurse manager told Administrator A that she had reviewed eight tracheotomy patient files in connection with the CMS investigation. Physician D was the pulmonologist for all the patients and had performed all but one of the tracheotomies. The nurse manager said that there was no documentation in the patient files explaining the decision to intubate the patients or any efforts to wean them from the ventilators. The following day Administrator A reported the findings to Novak and others and regarding the lack of documentation, and Novak replied with an expletive, according to the affidavit.
On April 8, Physician D told Administrator A in a recorded conversation that Novak had asked him to provide two more tracheotomy cases for the hospital soon before the CMS surveyors might return.
Novak’s Business Interests
According to the affidavit, Novak has direct or indirect ownership interest in various related entities, including Superior Home Health, LLC, a home healthcare company; the Golden L.I.G.H.T. clinics, which are family practice / internal medicine clinics operated as divisions as Sacred Heart; the Chen Medical center; the Garfield Kidney Center, LLC, an outpatient dialysis center; and the Bentley Insurance Group, a medical malpractice insurance company. Novak also owns various real estate and corporate management holding companies, and prior to June 2012, he operated the Chicago R.E.A.C.H Foundation, a purported non-profit, senior citizen program financed by the State of Illinois.
In a series of recorded conversations over the last two months, Payawal told Administrator A that a substantial part of Sacred Heart’s revenue comes from Medicare and Medicaid reimbursements, and explained various ways in which revenue generated from the hospital is transferred to and among Novak’s other corporate interests.
Conspiracy to violate the federal anti-kickback statute carries a maximum penalty of five years in prison and a $250,000 fine and restitution is mandatory. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The government is being represented by Assistant U.S. Attorneys Joel Hammerman, Terra Reynolds and Ryan Hedges.
The public is reminded that a complaint is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
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Source- http://www.justice.gov/usao/ohn/news/2013/15aprilpatel.html
A man who lives in Orange, Ohio, admitted to overbilling Medicaid and Medicare by more than $2.5 million, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Divyesh “David” C. Patel, age 39, pleaded guilty to one count of conspiracy to commit health care fraud and four counts of health care fraud. Patel is expected to be sentenced later this year.
“This defendant enriched himself and his company by flouting rules designed to protect the public,” Dettelbach said.
“Mr. Patel defrauded the tax payers by scamming Medicaid and Medicare,” said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office. “Waste, fraud and abuse take critical resources out of our health care system and contribute to the rising cost of health care for all Americans.”
Patel was the owner and president of Alpine Nursing Care, Inc., located at 4753 Northfield Road, Suite 5, North Randall, Ohio, employed Belita Mable Bush, as the office manager and director of provider services from June 1, 2006 through October 18, 2009, according to court documents.
Patel and Alpine employed Bush to prepare and submit the billings to Medicaid and Medicare for reimbursement for services provided by Alpine as a home health care provider, even though Patel knew that Bush had been previously convicted of a health care-related felony that excluded Bush from being involved in any way with Alpine’s Medicaid and Medicare billings, according to court documents.
In addition to the fact that Bush was excluded from handling Alpine’s medical billings, Patel was aware that Bush falsified documents related to health care services allegedly provided to home health patients where the services were never provided, or were provided by home health aide that had previous criminal convictions that excluded them from providing health services in people’s houses, according to court documents.
As a result of the conspiracy, Medicaid and Medicare suffered a loss of approximately $2,564,392, according to court documents.
Bush was convicted on related charges and is scheduled to be sentenced May 28.
The defendant's sentence will be determined by the court after review of factors unique to this case, including any prior criminal record, the defendants’ role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and, in most cases it will be less than the maximum.
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Source- http://www.justice.gov/usao/pae/News/2013/Apr/pennchoice_release.htm
PHILADELPHIA – An indictment was unsealed today charging Penn Choice Ambulance Inc., operating from Philadelphia, PA, Huntington Valley, PA and Camp Hill, PA, its owner, Anna Mudrova, and operators Yury Gerasyuk, Mikhail Vasserman, Irina Vasserman, Aleksandr Vasserman, Valeriy Davydchik, and Khusen Akhmedov, with conspiracy to commit health care fraud. The alleged scheme involved more than $3.6 million in fraudulent claims submitted to Medicare. The defendants were also charged with related crimes including making false statements in connection with health care matters, aggravated identity theft, paying kickbacks to patients, and money laundering, announced United States Attorney Zane David Memeger.
Valeriy Davydchik, 58, and Khusen Akhmedov, 22, Mikhail and Irina Vasserman, both 50, and Aleksandr Vasserman, 29, all of Philadelphia, were arrested this morning. Mudrova, 40, Gerasyuk, 41, also of Philadelphia, will make a court appearance tomorrow. According to the indictment, the defendants conspired to defraud Medicare by recruiting patients who were able to walk and could travel safely by means other than ambulance and who therefore were not eligible for ambulance transportation under Medicare requirements. It is alleged that the defendants, and others acting on their behalf, falsified reports to make it appear that the patients needed to be transported by ambulance when the defendants knew that the patients could be transported safely by other means and that many of them walked to the ambulance for transport. It is further alleged that the defendants themselves, or through others, paid illegal kickbacks to the patients as part of scheme. The defendants allegedly billed Medicare for these ambulance services as if those services were medically necessary and, as a result of the allegedly fraudulent billing, the Medicare program sustained losses of more than $1.5 million for this medically unnecessary method of transportation.
If convicted, the defendants face substantial terms of imprisonment and fines. If convicted, Penn Choice Ambulance Inc. faces significant financial penalties, including substantial criminal fines, restitution and forfeiture obligations. All defendants could also be excluded from participating in federal health care programs.
Bank accounts and other assets were seized which are subject to criminal forfeiture proceedings.
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Source- http://www.justice.gov/usao/nj/Press/files/Katz,%20Jose%20Plea%20News%20Release.html
NEWARK, N.J. – A well-known cardiologist and the founder, CEO, and sole owner of a pair of large medical services companies in New Jersey and New York admitted today to conspiring in a multimillion-dollar health care fraud scheme that subjected thousands of patients to unnecessary tests and potentially life-threatening, unneeded treatment, as well as treatment by unlicensed or untrained personnel. The guilty plea was announced today by New Jersey U.S. Attorney Paul J. Fishman.
Jose Katz, 68, of Closter, N.J., pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to an Information charging him with one count of conspiracy to commit health care fraud and one count of Social Security fraud arising from a separate scheme to give his wife a “no show” job and make her eligible for Social Security benefits.
As part of his plea agreement with the government, Katz agreed that the loss amount sustained by Medicare, Medicaid and other insurers victimized by the fraudulent billings was $19 million. U.S. Department of Health and Human Services, Office of Inspector General and FBI records indicate the loss amount suffered by the victims is the largest recorded in New Jersey, New York and Connecticut for an individual practitioner convicted of health care fraud.
“After years of prominence in his field, Jose Katz will now be remembered for his record-setting fraud,” said U.S. Attorney Fishman. “Katz was so focused on illegal profits that he directed unlicensed and unqualified providers to treat his patients, ordered unnecessary tests and cavalierly ordered treatments that could have caused patient harm. Ripping off the government and insurance companies is bad enough; risking patient health in the bargain is inexcusable.”
“Health care fraud is not a victimless crime. It is a plague on American society and could put the health of people who need medical care at risk, said FBI Special Agent in Charge Aaron T. Ford. “The FBI, together with its law enforcement and regulatory agency partners, will vigorously investigate these crimes and hold those responsible accountable.”
“I am proud to be part of the federal team that brought Dr. Katz to justice after a complicated investigation,” said Tom O’Donnell, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General’s New York Regional Office. Dr. Katz had very little regard for his patients and the Medicare program, as evidenced by his blatant behavior. Criminals can be assured that if they attempt to defraud Medicare and their patients, they will be brought to justice.”
According to documents filed in this case and statements made in court:
Katz was the founder, CEO, and sole equity-holder of Cardio-Med Services LLC (Cardio-Med), and Comprehensive Healthcare & Medical Services LLC (Comprehensive Healthcare). From 2004 through 2012, Cardio-Med had offices in Union City, Paterson, and West New York, N.J., and Comprehensive Healthcare had offices in Manhattan and Queens, New York. Both Cardio-Med and Comprehensive Healthcare provided cardiology, internal medicine and other medical services to individual patients. During that time period, Katz conspired to bill Medicare Part B, Medicaid, Empire BCBS, Aetna and others for unnecessary tests and unnecessary procedures based on false diagnoses, and for medical services rendered by unlicensed practitioners.
Between July 2006 and February, 2009, Katz spent more than $6 million for advertising on Spanish-language television and radio stations. The ads attracted hundreds of patients to Cardio-Med and Comprehensive Healthcare every day. Overall, Katz was able to bill Medicare and Medicaid more than $70 million for his services from 2005 through 2012.
Over the course of the conspiracy, Katz ordered and performed essentially the same battery of diagnostic tests for nearly all the patients he treated, regardless of their symptoms. Katz also instructed his non-physician employees to order and perform diagnostic tests for patients of other doctors working at his offices, even though he had not examined those patients and the other physicians had not ordered the unnecessary tests.
Most significantly, Katz admitted that he falsified patient charts with fictitious and boilerplate symptoms and falsely diagnosed a majority of his Medicare and Medicaid patients with coronary artery disease and debilitating and inoperable angina. He also admitted to making the diagnoses to justify prescribing and administering an unnecessary treatment for those patients called enhanced external counter pulsation, or EECP. Katz even prescribed EECP treatments for some patients with contraindications for the treatment, therefore subjecting those patients to a substantial risk of serious injury or death.
From 2005 through 2012, Medicare and Medicaid paid Katz more than $15.6 million just for his EECP treatments, most of which were fraudulent.
In addition, Katz ordered conspirator Mario Roncal, 62, of Woodland Park, N.J. – who had a medical degree from San Juan Bautista School of Medicine in San Juan, Puerto Rico, but did not have a license to practice medicine in any of the 50 states – to treat patients, knowing he was not licensed. At Katz’s direction, Roncal held himself out to fellow employees and to patients as “Dr. Roncal,” examined new patients as well as Katz’s follow-up patients, ordered diagnostic tests, diagnosed patients with medical conditions and diseases and recommended and prescribed courses of treatment and surgery – including falsely diagnosing patients with angina and prescribing EECP treatments for those patients.
To conceal this illegal and unlicensed practice of medicine, Roncal forged Katz’s signature on paperwork associated with Roncal’s unlawful medical services, including on patient charts. During the conspiracy, Katz used his own billing numbers to bill Medicare Part B and Medicaid for the illegal services Roncal provided as though they were provided by Katz.
Roncal was indicted on March 2, 2012, for conspiracy to commit health care fraud. He entered a guilty plea on Jan. 4, 2013 and awaits sentencing.
Katz also admitted to a Social Security fraud scheme in which, from 2005 through 2012, he kept his wife on Cardio-Med’s payroll though she performed little or no work. During the course of the scheme, Katz sent false W-2 forms for calendar years 2005 through 2011 to the U.S. Social Security Administration purportedly reflecting $1,251,604 in earnings for his wife, making her eligible for an estimated $263,000 in Social Security benefits to which she was not entitled.
The health care fraud conspiracy and fraud counts with which Katz is charged carry a maximum potential penalty of 10 and five years in prison, respectively. Each count also carries a maximum $250,000 fine, or twice the gross gain or loss from the offense. At sentencing, currently scheduled before Judge Linares on July 23, 2013, Katz will also be ordered to pay restitution to victims of his offenses. Katz was granted $200,000 bail pending sentencing.
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Source- http://www.justice.gov/usao/nye/pr/2013/2013apr10.html
Earlier today, Helene Michel, an owner and officer of Medical Solutions Management, Inc. (“MSM”), was sentenced to 12 years in federal prison by United States District Judge Joseph F. Bianco at the federal courthouse in Central Islip, New York. Michel was convicted after a three-week jury trial in August 2012 of conspiracy to commit health care fraud, health care fraud, and HIPAA identity theft crimes. At today’s sentencing, Judge Bianco also ordered that Michel forfeit $1.3 million that was seized by the government at the time of her indictment.
The sentences were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, Thomas O’Donnell, Special Agent in Charge, United States Department of Health & Human services, Office of Inspector General, Office of Investigations (“HHS OIG”), and George C. Venizelos, Assistant Director in Charge, Federal Bureau of Investigation (“FBI”), New York Field Office.
According to the evidence at trial, between approximately April 2003 and March 2007, Helene Michel owned and operated MSM, a medical equipment company located in Hicksville, New York. Michel used her position as a medical equipment company owner to enter nursing homes in Nassau, Suffolk, Queens, Kings, and Dutchess Counties in order to access and steal patient records, in violation of the Health Insurance Portability and Accountability Act (“HIPAA”). During the scheme, Michel also falsely assumed a number of roles, including posing at various times as a doctor, a nurse practitioner, and a wound care expert. At times, in her false roles, Michel even accompanied doctors on patient evaluation rounds. Thereafter, Michel used the records that she stole to create and submit $10 million in false billings to Medicare for medical supplies and products that were either not required or not delivered. For example, in one instance, Michel used fraudulent drawings and measurements to support a Medicare claim for the cost of fitted boots for a legless patient. In another, Michel submitted false claims for the purchase of expensive wound care bandages to treat patients who never had such wounds. In the event that Medicare denied an MSM claim, Michel submitted an appeal of the denial supported by additional stolen and altered patient records.
Michel spent the Medicare funds that she stole through false claims and identity theft on her own personal interests, including a multi-million dollar home on Long Island’s North Shore, a half-million dollar pension account, and personal items such as luxury cars and designer handbags. Michel’s co-defendant Etienne Allonce, the co-owner of MSM, was also charged in the indictment and is believed to have fled from the United States. He remains a fugitive, listed on HHS OIG’s Most Wanted List.
“Helene Michel brazenly roamed the halls of dozens of nursing homes, pretending to be, among other things, a doctor, a nurse practitioner, and a wound care expert, even going so far as to join patient evaluations. In reality she was a con woman, deceiving patients and administrators alike as she trolled for the information she used to submit fraudulent claims to Medicare to support her extravagant lifestyle. Through her scheme she violated the privacy of over a thousand patients and stole Medicare funds dedicated to preserving the health of our seniors and other citizens,” stated United States Attorney Lynch. “We and our law enforcement partners will vigorously pursue and prosecute those who seek to profit by such despicable crimes.” Ms. Lynch expressed her grateful appreciation to HHS OIG, the FBI, and the Nassau County District Attorney’s Office.
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Source- http://www.justice.gov/usao/nj/Press/files/BLS%20et%20al%20Arrests%20News%20Release.html
NEWARK, N.J. – Federal agents arrested the president and part-owner of Parsippany, N.J.-based Biodiagnostic Laboratory Services LLC (BLS), a New Jersey physician and two other BLS employees this morning on charges they participated in a long-running scheme to bribe doctors to refer patient blood samples to BLS and to order unnecessary tests, resulting in tens of millions of dollars in profit for the company. The charges were announced today by New Jersey U.S. Attorney Paul J. Fishman.
BLS president David Nicoll, 39, of Mountain Lakes, N.J.; Scott Nicoll, 32, of Wayne, N.J., a senior BLS employee and David Nicoll’s brother; and Craig Nordman, 34, of Whippany, N.J., a BLS employee and the CEO of Advantech Sales LLC – an entity used by BLS to make illegal payments – are charged in a federal Complaint with conspiring to bribe physicians over a period of several years. BLS is also charged with the conspiracy.
Frank Santangelo, 43, of Boonton, N.J., a New Jersey physician with offices in Montville and Wayne, is charged in the Complaint for allegedly accepting bribes to refer patients to BLS and violating his duty of fidelity to his patients. Santangelo allegedly received more than $700,000 in bribe payments from BLS and sent the company more than $4.2 million in blood referrals.
The defendants are scheduled to appear this afternoon before U.S. Magistrate Judge Madeline Cox Arleo in Newark federal court.
“People depend on their doctors to make medical decisions about care based solely on medical need,” said U.S. Attorney Fishman. “When doctors order extra tests or choose particular labs in exchange for cash, they abandon their obligation to their patients and to all of us who support our nation’s health care system. No patients should have to worry that their doctors’ loyalty and judgment have been bought by a salesman trying to make a buck.”
“The FBI views health care fraud as a severe crime problem that affects every American,” said FBI Special Agent in Charge Aaron T. Ford. “Fraud and abuse take critical resources out of our health care system, and contribute to the rising cost of health care for everyone. Today’s arrests are the result of a long term, multi-agency investigation into a complex health care fraud scheme, requiring substantial investigative resources. The FBI, with its law enforcement partners, will continue to provide a significant amount of expert resources to investigate these crimes.”
“Kickbacks have no place in the healthcare industry. Financial inducements only cloud medical judgment. This elaborate kickback scheme had one goal, and that is greed,” said Tom O’Donnell, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “Federal and state taxpayers, and vulnerable patients, deserve better.”
According to the Complaint unsealed today:
Between 2006 and 2013, BLS and entities it funded paid millions of dollars to physicians to induce them to refer patient blood samples to BLS. From these referrals, BLS received at least tens of millions of dollars from private health insurance companies and Medicare.
Numerous physicians were bribed under the guise of lease, service, and/or consulting agreements. Under the lease and service agreements, between 2006 and 2009, physicians were frequently paid thousands of dollars a month by BLS for space in medical offices that BLS did not need or actually use and to perform routine blood drawing services that had little real dollar value.
In a text message referenced in the Complaint, David Nicoll wrote to Santangelo about the status of their referral agreement, stating that BLS “really can’t afford the 40-50,000 [dollars] a month if the girls aren’t going to be drawing any blood,” to which Santangelo responded by stating, “U no u can count on me!” and “I never let u down!”
When the state of New Jersey sought to address the problem of laboratories using lease agreements to bribe physicians for referrals – effectively prohibiting all leases between blood laboratories and physicians in 2010 – BLS, David Nicoll, Scott Nicoll, and Nordman funded and used at least half a dozen entities to disguise bribe payments to physicians.
In one example from the Complaint, a physician was paid $1,500 per month by Nordman – who identified himself as both a BLS employee and the CEO of Advantech – for spending less than two minutes each month filling out a one-page questionnaire asking how often sales representatives visited the physician’s office, which insurance companies were in-network for the physician and which out-of-network insurance companies did the physician bill. In reality, the payments were to refer patients’ blood samples to BLS.
Various recorded conversations are also detailed in the Complaint, including one in which Nordman urges another physician to order “more tests,” stating “that’s where it really is. I mean if we get 10 bloods for $1,000 as opposed to 10 bloods for $4,000 or 5 bloods for $4,000 obviously there’s more. We get paid a percentage obviously.” In a second conversation, Scott Nicoll tells this same physician, “I would like to be able to get you you know around 1,500 [dollars] a month if I can but I need we would either need more tests or more patients or something along those lines . . . you’re doing about a $1,000 a bag per patient . . . if we could, we could somehow get that up in the two’s then I’m looking at making 4,000 and I have no problem paying you know 1,500 [dollars] for it.”
Over the course of the charged conspiracy, BLS has made more than $200 million from the testing of blood specimens and related services. David Nicoll received more than $33 million in distributions from BLS during that same time period, during which he also spent millions on personal items: more than $5 million on high-end and collectible automobiles, including approximately $580,000 for a Yenko Nova and approximately $365,000 for a Yenko Chevelle, approximately $300,000 for a Ferrari and approximately $291,000 for a Corvette; more than $700,000 to purchase a Manhattan apartment for a female companion; $600,000 on private jet charters; $392,000 on tickets to sporting events; $216,000 at electronics stores; and $154,000 at a gentleman’s club and restaurant.
“It is alleged in today’s Complaint that the president and other employees of BLS bribed physicians to refer patients to their lab and order unnecessary lab tests, reaping millions of dollars, all in the name of greed,” stated Shantelle P. Kitchen, Acting Special Agent in Charge, IRS-Criminal Investigation, Newark Field office. “Medical tests should only be run when medically necessary, not so someone can buy exotic cars and charter private jets. This type of health care fraud will not be tolerated and IRS-Criminal Investigation, along with our law enforcement partners, will vigorously investigate these crimes to bring the perpetrators to justice.”
“Postal Inspectors, along with other law enforcement agents, unraveled a sophisticated false billing scheme that resulted in millions of dollars in losses,” said Acting Inspector in Charge Maria Kelokates, Newark Division of the U.S. Postal Inspection Service. “Postal Inspectors will continue to aggressively pursue investigations in which the U.S. Mail is used to facilitate a crime.”
David Nicoll, Scott Nicoll and Nordman are charged with one count of conspiring to violate the Anti-Kickback Statute and the Federal Travel Act. Santangelo is charged in two counts – with substantive violations of the Anti-Kickback Statute and the Federal Travel Act, for allegedly using the interstate mails in aid of commercial bribery. If convicted, the defendants face a maximum potential penalty of five years in prison on each of the counts with which they are charged. Each count also carries a maximum $250,000 fine, or twice the gross gain or loss from the offense. BLS is also charged with the conspiracy, and faces a maximum potential penalty of five years of probation and a $500,000 fine, or twice the gross gain or loss.
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Source- http://www.justice.gov/usao/txn/PressRelease/2013/APR2013/apr9goodwin_michael_HCF_sen.html
AMARILLO, Texas — Dr. Michael David Goodwin, 63, an orthodontist who practiced in Amarillo, Texas, and Crown Point, Indiana, was sentenced today by U.S. District Judge Mary Lou Robinson to 50 months in federal prison and ordered to pay $1,810,960 in restitution, following his guilty plea in December 2012 to one count of health care fraud related to the Texas Medicaid program. In addition, Goodwin must forfeit $1,558,911, which are the gross proceeds traceable to his offense, as well as more than $244,000 the government seized in May and July 2011 from his JP Morgan Chase accounts. Judge Robinson ordered that he surrender to the Bureau of Prisons on April 29, 2013. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
According to documents filed in the case, from January 2008 through March 2011, Goodwin devised a scheme to defraud the Texas Medicaid program by billing the program at least $2,626,125 for services he claimed he provided, when in fact, as he well knew, some of the services were not medically necessary, or dental assistants provided those services when no dentist or orthodontist was present to supervise, and even when present, did not directly supervise or provide any services.
Goodwin practiced orthodontic dentistry approximately two weeks each month at Goodwin Orthodontics in Amarillo and approximately two weeks each month at his Indiana office. In order to maximize the number of Medicaid patients seen, on numerous occasions, Goodwin had his employees schedule more than 100 patients per day and intentionally schedule large numbers of Medicaid patients for days when Goodwin was scheduled to be out of town. To accommodate the large volume of patients, Goodwin directed dental assistants to perform impermissible acts, including comprehensive examinations, diagnoses and treatment planning for Medicaid patients when he knew that only licensed dentists were permitted to perform those acts.
Goodwin devised a generic treatment guideline for dental assistants to follow in treating Medicaid beneficiaries that included dental assistants making treatment decisions at most appointments, without Goodwin examining the patients; confirming or revising the diagnoses; or confirming or revising the treatment plans. Goodwin also caused his billing staff to falsely and fraudulent state on Medicaid claims that he was the performing provider for all services that had been impermissibly delegated to and performed by dental assistants.
In April 2009, Goodwin hired substitute general dentists to create the appearance of direct supervision of dental assistants when he was away from the office. These substitute dentists were not enrolled Medicaid orthodontic providers. These substitutes did not provide services to Medicaid beneficiaries, did not directly supervise the dental assistants who provided the services, and were not always present in the office for orthodontic procedures. Again, Goodwin caused his billing staff to falsely and fraudulently state on Medicaid claims that he was the performing provider for all services performed when he was out of town and dental assistants provided those services when a substitute dentist was present to supervise, but did not directly supervise or provide any services.
Goodwin also instructed his dental assistants to falsely and fraudulently indicate in the patient records that an “adjustment” was performed on every visit, except for the initial consult, when no such adjustment had been provided and when he knew this violated Medicaid Rules.
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Source- http://www.justice.gov/usao/ma/news/2013/April/GonzalezMiosottisPleaPR.
BOSTON - A Holyoke resident pleaded guilty today in U.S. District Court in Springfield to defrauding MassHealth by billing for personal care attendant services that were never provided.
Miosottis Gonzalez, 25, pleaded guilty to conspiracy to commit health care fraud. Three other individuals involved in the conspiracy, including Gonzalez’s aunt and uncle, previously pleaded guilty and were sentenced earlier this month.
Gonzalez engaged in a scheme to defraud the state’s Personal Care Attendant (PCA) Program, which is funded by MassHealth, the Commonwealth’s Medicaid Program, and assists individuals with permanent or chronic disabilities to keep their independence, stay in the community and manage their own personal care. The disabled individual is responsible for recruiting, hiring, scheduling, training, and, if necessary, firing his or her PCA and track the work performed by the PCA on bi-weekly time sheets.
Gonzalez recruited friends to provide identification documents which were used to bill MassHealth for PCA services that were never provided. She also signed and submitted false time sheets in her own name to obtain payment for services she never provided.
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Source- http://www.justice.gov/usao/nye/pr/2013/2013apr08.html
Gustave Drivas, M.D., a medical doctor and resident of Staten Island, was convicted today of two felony counts for his role in a $77 million Medicare fraud scheme. The jury’s verdict followed an eight-week long trial in United States District Court in Brooklyn, New York, before the Honorable Nina Gershon. The conviction was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and Mythili Raman, Acting Assistant Attorney General of the United States for the Department of Justice.
The evidence at trial showed that Drivas, a medical doctor licensed in the State of New York, knowingly authorized his coconspirators at a medical clinic in Brooklyn, New York, to use his Medicare billing number to charge Medicare for more than $20 million in medical procedures and services that were never performed. In return he received more than $500,000 for his role in the scheme. The evidence established that Drivas was a “no show” doctor, who almost never visited the clinic. The evidence also showed that the medical clinic paid cash kickbacks to Medicare beneficiaries and used the beneficiaries’ names to bill Medicare for more than $77 million in services that were medically unnecessary and never provided.
The government’s investigation included the use of a court-ordered audio/video recording device hidden in a room at the clinic, in which the conspirators paid cash kickbacks to corrupt Medicare beneficiaries. The conspirators were recorded paying approximately $500,000 in cash kickbacks during a period of approximately six weeks from April to June 2010. This room was marked “PRIVATE” and featured a Soviet-era poster of a woman with a finger to her lips and the words “Don’t Gossip” in Russian. The purpose of the kickbacks was to induce the beneficiaries to receive unnecessary medical services or to stay silent when services not provided to the patients were billed to Medicare.
To generate the large amounts of cash needed to pay the patients, the conspirators used a network of external money launderers. The owners and operators of the clinic wrote clinic checks to numerous shell companies that were controlled by money launderers. These checks did not represent payment for any legitimate service at, or for, the medical clinics. Rather, the checks were written to launder the medical clinics’ fraudulently obtained Medicare proceeds. Two of the external money launderers, Anatoly Kraiter and Larisa Shelabadova, pleaded guilty prior to trial. Irina Shelikhova and her son Maksim Shelikhov, who directed the money laundering operation from inside the clinic, also pleaded guilty prior to trial to conspiracy to commit money laundering.
Drivas was convicted today of health care fraud conspiracy and health care fraud. He was acquitted of kickback conspiracy. At sentencing before U.S. District Judge Nina Gershon of the Eastern District of New York, scheduled for July 9, 2013, Drivas faces a maximum penalty of 20 years in prison. Drivas also faces mandatory restitution to be paid jointly and severally with his co-defendants of up to $50 million, and a fine of up to $100 million.
This is the 13th conviction in this case. Prior to trial, 12 defendants pleaded guilty. At trial, Alexander Zaretser, 32, Vladimir Kornev, 53, and Yelena Galper, 40, were acquitted.
“Gustave Drivas sold his license and his ethics for cold, hard cash, and was the linchpin in a scheme that defrauded the Medicare system of millions. Medicare fraud weakens a vitally important program which millions of our citizens rely upon. We will continue to be vigilant in bringing those who seek to steal from Medicare to justice,” stated United States Attorney Lynch. Ms. Lynch thanked the Federal Bureau of Investigation and Health and Human Services for their hard work in connection with this investigation that led to the defendant’s arrest and conviction.
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Source- http://www.justice.gov/opa/pr/2013/April/13-crm-387.html
The owners and operators of Biscayne Milieu, a Miami-based mental-health clinic, and the clinic itself were sentenced today for their participation in a Medicare fraud scheme involving the submission of more than $50 million in fraudulent billings to Medicare, announced Acting Assistant Attorney General Mythili Raman 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.
Antonio Macli, 73, Jorge Macli, 41 and Sandra Huarte, 49, all of Miami, and Biscayne Milieu were sentenced by U.S. District Judge Robert N. Scola Jr. in the Southern District of Florida. Antonio Macli was sentenced to serve 360 months in prison; Jorge Macli was sentenced to serve 300 months in prison; and Huarte was sentenced to serve 262 months in prison. In addition, Biscayne Milieu, the corporate entity these defendants controlled, was sentenced to one year of probation. In addition to their prison terms, Antonio Macli, Jorge Macli and Huarte were each sentenced to serve three years of supervised release. Restitution payments for each of the defendants will be determined on April 25, 2013.
The defendants were each convicted on Aug. 24, 2012, of conspiracy to commit health care fraud, at least one substantive count of health care fraud, and conspiracy to offer and pay kickbacks following a two-month jury trial. Antonio and Jorge Macli and Huarte were also each convicted of conspiracy to commit money laundering and substantive money laundering counts at trial.
According to the evidence at trial, Biscayne Milieu was a closely held, family-run fraudulent clinic that was owned by Antonio Macli and his son Jorge Macli. Antonio Macli’s daughter Sandra Huarte was an executive at the clinic. Together the defendants created and oversaw a scheme in which they, along with their co-defendants, submitted over $50 million in false and fraudulent claims to Medicare through Biscayne Milieu, which purportedly operated a partial hospitalization program (PHP) – a form of intensive treatment for severe mental illness. Instead, the defendants devised a scheme in which they paid patient recruiters to refer ineligible Medicare beneficiaries to Biscayne Milieu for services that were never provided or that were not reimbursable under applicable Medicare rules. Many of the patients admitted to Biscayne Milieu that they were not eligible for PHP treatment because they were chronic substance abusers, suffered from dementia and would not benefit from group therapy, or were not mentally ill and were procuring false diagnoses of mental illness in order to obtain exemptions from the civics portion of the U.S. citizenship application.
The evidence at trial further showed that Antonio and Jorge Macli and Huarte collectively paid patient recruiters more than $1 million in illegal kickbacks to recruit Medicare patients who were ineligible for PHP treatment. Biscayne Milieu then billed Medicare for tens of millions of dollars in PHP treatments for these patients. Antonio and Jorge Macli and Huarte also hired doctors, therapists and other health care professionals to further their massive illegal scheme. Along with co-conspirators working at their direction, they created falsified medical records intended to conceal their Medicare fraud and phony “case manger” contracts in an attempt to hide their extensive illegal kickbacks.
Antonio Macli was the initiator of the fraud scheme, enlisted his son and daughter to participate in it and had primary control over the clinic’s bank accounts that received money stolen from Medicare that was then used to pay illegal kickbacks.
Jorge Macli was most responsible for the clinic’s day-to-day operations and took steps, on a daily basis, to conceal and further the fraud, including deflecting complaints from patients and staff and paying bribes to patients in exchange for their silence.
Huarte oversaw both the kickback payments and the Medicare billings for the clinic. Huarte ensured that Biscayne Milieu’s fraudulent claims could pass scrutiny by Medicare by creating fraudulent paperwork and medical files, and soliciting other employees to do the same, so that these false claims were paid.
Evidence further revealed that Antonio and Jorge Macli and Sandra Huarte engaged in a sophisticated scheme to use a series of ostensibly legitimate corporations to conceal and launder Biscayne Milieu’s fraudulent profits.
Various owners, doctors, managers, therapists, patient brokers and other employees of Biscayne Milieu have also been charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed in September 2011 and May 2012. Biscayne Milieu, its owners, and more than 25 of the individual defendants charged in these cases have pleaded guilty or have been convicted at trial.
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Source- http://www.justice.gov/opa/pr/2013/April/13-civ-378.html
Intermountain Health Care Inc. has agreed to pay the United States $25.5 million to settle claims that it violated the Stark Statute and the False Claims Act by engaging in improper financial relationships with referring physicians, the Justice Department announced today. Intermountain operates the largest health system in the state of Utah.
The Stark Statute restricts the financial relationships that hospitals may have with doctors who refer patients to them. The relationships at issue in this matter that the United States alleged were prohibited by the Stark Statute included employment agreements under which the physicians received bonuses that improperly took into account the value of some of their patient referrals; and office leases and compensation arrangements between Intermountain and referring physicians that violated other requirements of the Stark Statute. These issues were disclosed to the government by Intermountain.
“The Department of Justice has longstanding concerns about improper financial relationships between health care providers and their referral sources, because such relationships can corrupt a physician's judgment about the patient's true healthcare needs,” said Stuart F. Delery, Acting Assistant Attorney General for the Department’s Civil Division. “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable for patients.”
“People should expect that hospitals and doctors care more for their patients than their bottom line profits,” said Gerald Roy, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services region including Utah. “So I applaud Intermountain for recognizing their liability and coming forward to self-disclose these violations. We will vigilantly protect taxpayer-funded health programs against Stark violations through tight coordination with our partners at the Department of Justice.”
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 $14.2 billion.
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Source- http://www.justice.gov/usao/dc/news/2013/apr/13-115.html
WASHINGTON – Jeannette N. Awasum, the former owner of a health care provider, pled guilty today to a federal charge stemming from falsifying records in connection with a U.S. Department of Health and Human Services audit.
The guilty plea was announced by U.S. Attorney Ronald C. Machen Jr., Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, and Nicholas DiGiulio, Special Agent In Charge of the U.S. Department of Health and Human Services, Office of Inspector General (HHS - OIG) for the region including the District of Columbia.
Awasum, 49, of Germantown, Md., pled guilty in the U.S. District Court for the District of Columbia to a charge of falsification of records in connection with a federal investigation. She is to be sentenced July 9, 2013 by the Honorable Richard J. Leon. The charge carries a maximum statutory sentence of 20 years in prison and a fine of up to $250,000.
According to a statement of offense, signed by the defendant as well as the government, in early June 2010, Awasum, the Chief Executive Officer and owner of Tri State Home Health and Equipment Service, was informed that the U.S. Department of Health and Human Services requested the physician-signed plans of care for 130 of its patients. These plans of care are what authorize providers like Tri State to provide home healthcare services to Medicare and D.C. Medicaid beneficiaries.
Awasum knew that Tri State lacked plans of care for 62 of these 130 patients. Tri State received approximately $1,879,853 from Medicare and D.C. Medicaid for treating these 62 patients during the period for which plans of care were missing. Awasum directed her employees to fraudulently create plans of care for the services that these 62 patients received, making it appear as if the documents had been created prior to the services being provided. In total, the employees created 81 plans of care for these 62 patients.
Awasum instructed one of her employees to take the 81 fabricated forms to a doctor whom Awasum knew never examined these patients. Despite the fact that this doctor never examined these patients, he signed the plans of care in June 2010, making it appear as if he authorized these 62 patients receiving home healthcare services prior to the time that Tri State provided these services. The employee, at Awasum’s directions, placed the fraudulent 81 plans of care in Tri State’s file so that the forms would be present when the U.S. Department of Health and Human Services audited the services provided to these 62 patients.
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Source- http://www.justice.gov/usao/txn/PressRelease/2013/APR2013/apr3umotong_gates_HCF_con.html
Scheme Involved Nearly $3 Million in Fraudulent Billings
DALLAS — Following a seven-day trial, before U.S. District Judge David C. Godbey, a federal jury has convicted three defendants on health care fraud and related charges stemming from their involvement in the operation of Euless Healthcare Corporation (EHC) and Medic Healthcare Incorporated (Medic), announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas. ECH was located on West Bedford Euless Road in Hurst Texas, and Medic, which operated from October 2009 to May 2011, was located on Bonhomme Road in Houston.
Specifically, defendants Godwin Umotong, 58, and Comfort Gates, 46, both of Houston, were each convicted on one count of conspiracy to commit health care fraud. In addition, Umotong was also convicted on five counts of health care fraud and Gates was convicted on two counts of health care fraud. Umotong was an employee of EHC and Medic; Gates was an employee of Medic. Defendant Vagharshak Smbatyan, 61, of Grenada Hills, California, was convicted on one count of making a false statement to a federal agency.
The conspiracy count and each of the substantive health care fraud counts carry a maximum statutory penalty of 10 years in federal prison, a $250,000 fine and restitution. The false statement count carries a maximum statutory penalty of five years in federal prison, a $250,000 fine and restitution. Judge Godbey set a July 15, 2013, sentencing date for all three defendants convicted today.
Ovsanna Agopian, the operator of both EHC and Medic, pleaded guilty in November 2012 to one count of conspiracy to commit health care fraud. Agopian, 58, is a resident of Houston; her husband is Vagharshak Smbatyan. Three other defendants charged in the case, Boghos Babadjanian, 55, of Sherman Oaks, CA; Leslie Omagbemi, 56, of Dallas, TX; and Munda Massaquoi, 69, of Houston, TX, also pleaded guilty to their roles in the fraud. All are awaiting sentencing.
According to documents filed in the case and evidence presented at trial, Agopian, Umotong, Omagbemi, Massaquoi and Gates conspired together to submit, or cause to be submitted, fraudulent claims to Medicare for diagnostic tests and office visits. Agopian recruited unlicensed doctors to work for EHC and Medic by telling them that they would treat beneficiaries in the beneficiaries’ homes. Medicare does not pay for services performed by unlicensed persons. Nevertheless, these recruits went to beneficiaries’ homes and purported to conduct medical examinations, including ordering diagnostic tests. In total, more than $2.7 million was fraudulently billed, and of that amount, Medicare paid more than $1.3 million.
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Source- http://www.justice.gov/usao/pae/News/2013/Apr/kuran_release.htm
PHILADELPHIA - Feda Kuran, 37, of Philadelphia, PA, was charged today in an Information1alleging a health care fraud scheme that involved billing Medicare for ambulance services that were not medically necessary, that were not actually provided, or that were induced by illegal kickbacks. As a result, the Medicare program paid more than $2 million for the inappropriate bills. Kuran is charged with Health Care Fraud and violating the Anti-Kickback Statute, announced United States Attorney Zane David Memeger.
The information alleges that, in July 2010, the defendant began operating Brotherly Love Ambulance, Inc. with a co-schemer. Kuran, or others acting at her direction, allegedly transported patients by ambulance when those patients could have been transported safely by other means and were, therefore, not eligible for ambulance service under Medicare and Medicaid requirements. It is further alleged that the defendant and others billed ambulance services for patients who were transported by Brotherly Love employees in personal vehicles or who drove themselves or took public transportation to their destinations. In addition, it is alleged that the defendant and other employees paid kickbacks to some patients to induce them to allow Brotherly Love Ambulance, Inc. to transport them and paid other patients so that the ambulance company could use those patients’ information to bill for transportation that Brotherly Love Ambulance never actually provided. Finally, it is alleged that the defendant received kickbacks from other ambulance companies to refer patients to the other ambulance companies.
If convicted, the defendant faces a maximum possible sentence of 15 years in prison, six years of supervised release, a $250,000 fine, a $200 special assessment, and an order of restitution and forfeiture. The amount of forfeiture is currently estimated at over $2 million.
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