WASHINGTON—The owner and operator of several Miami health care agencies was sentenced today to serve 120 months in prison for his role in a health care fraud scheme involving defunct home health care company Trust Care Health Services Inc.
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; Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; 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; and Acting Special Agent in Charge Michael J. DePalma of the Internal Revenue Service-Criminal Investigation’s (IRS-CI) Miami Field Office made the announcement.
Roberto Marrero, 60, of Miami, was sentenced by U.S. District Judge K. Michael Moore in the Southern District of Florida. In September 2013, Marrero pleaded guilty to conspiracy to commit health care fraud and conspiracy to receive and pay health care kickbacks.
Marrero was an owner and operator of Trust Care, a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries.
Co-conspirators Sandra Fernandez Viera, 49; Patricia Morcate, 34; and Enrique Rodriguez, 59, all of Miami, have also pleaded guilty to related charges, including conspiracy to commit health care fraud and conspiracy to receive and pay health care kickbacks. On November 13, 2013, Fernandez Viera was sentenced to serve 120 months in prison; Morcate was sentenced to serve 60 months; and Rodriguez was sentenced to serve 57 months.
Together with Marrero, Fernandez Viera was an owner and operator of Trust Care. Morcate worked at and was an investor in Trust Care. Rodriguez served as a patient recruiter on behalf of Trust Care.
According to court documents, Marrero and his co-conspirators operated Trust Care for the purpose of billing the Medicare Program for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or were not provided.
Marrero primarily controlled Trust Care and, in light of that role, oversaw the schemes operating out of the company. Marrero was also responsible for negotiating and paying kickbacks and bribes, interacting with patient recruiters, and coordinating and overseeing the submission of fraudulent claims to the Medicare program.
Marrero and his co-conspirators paid kickbacks and bribes to patient recruiters in return for the recruiters providing patients to Trust Care for home health and therapy services that were medically unnecessary and/or not provided. Marrero and his co-conspirators at Trust Care also paid kickbacks and bribes to co-conspirators in doctors’ offices and clinics in exchange for home health and therapy prescriptions, medical certifications and other documentation. Marrero and his co-conspirators used these prescriptions, medical certifications, and other documentation to fraudulently bill the Medicare program for home health care services, which Marrero knew was in violation of federal criminal laws.
From approximately March 2007 through at least October 2010, Trust Care submitted more than $20 million in claims for home health services. Medicare paid Trust Care more than $15 million for these fraudulent claims.
Marrero and his co-conspirators have also acknowledged their involvement in similar fraudulent schemes at several other Miami health care agencies in addition to Trust Care with estimated total losses of approximately $50 million. Those agencies include A&B Health Services Inc., Centrum Home Health Care Inc., Global Nursing Home Health Inc., Lovable Home Health Services Corp., New Concepts In Health Inc., Nursemed Home Care Corp., R&M Health Care Inc., Ubieta Health System Inc., and Vital Care Home Health Services Inc.
The case was investigated by the FBI and HHS-OIG, with the assistance of IRS-CI, and was brought as part of the Medicare Fraud Strike Force initiative, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case was prosecuted by Trial Attorney A. Brendan Stewart of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Friday, November 22, 2013
Durable Medical Equipment Clinic Owner Pleads Guilty in Miami for Role in $11 Million Health Care Fraud Scheme
WASHINGTON—The former owner of a defunct durable medical equipment (DME) clinic based in Miami pleaded guilty today for his role in an $11 million Medicare fraud scheme.
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, Special Agent in Charge Michael B. Steinbach 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 made the announcement.
Francisco Enrique Chavez, 36, of Miami, pleaded guilty before U.S. District Judge Patricia A. Seitz in the Southern District of Florida to one count of health care fraud. He faces a maximum penalty of 10 years in prison when he is sentenced on February 11, 2014.
According to court records, Chavez served as the president and sole corporate officer of World Class Medical Clinic Corp. (World Class). From March 27, 2006, through August 22, 2006, Chavez submitted or caused to be submitted approximately $11,303,494 in fraudulent claims to the Medicare program on behalf of World Class for DME that was neither prescribed by a physician nor medically necessary. Medicare paid more than $1,713,959 on these fraudulent claims. The proceeds of the World Class fraud scheme were deposited into corporate bank accounts that were controlled by Chavez, and he made numerous cash withdrawals and deposits into personal and shell entity bank accounts to conceal the nature of the scheme.
Chavez was a fugitive who was extradited from Spain to Miami on August 30, 2013.
This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case was prosecuted by Trial Attorneys Allan J. Medina and Sarah M. Hall of the Fraud Section. The Criminal Division’s Office of International Affairs provided significant assistance in the extradition.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
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, Special Agent in Charge Michael B. Steinbach 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 made the announcement.
Francisco Enrique Chavez, 36, of Miami, pleaded guilty before U.S. District Judge Patricia A. Seitz in the Southern District of Florida to one count of health care fraud. He faces a maximum penalty of 10 years in prison when he is sentenced on February 11, 2014.
According to court records, Chavez served as the president and sole corporate officer of World Class Medical Clinic Corp. (World Class). From March 27, 2006, through August 22, 2006, Chavez submitted or caused to be submitted approximately $11,303,494 in fraudulent claims to the Medicare program on behalf of World Class for DME that was neither prescribed by a physician nor medically necessary. Medicare paid more than $1,713,959 on these fraudulent claims. The proceeds of the World Class fraud scheme were deposited into corporate bank accounts that were controlled by Chavez, and he made numerous cash withdrawals and deposits into personal and shell entity bank accounts to conceal the nature of the scheme.
Chavez was a fugitive who was extradited from Spain to Miami on August 30, 2013.
This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case was prosecuted by Trial Attorneys Allan J. Medina and Sarah M. Hall of the Fraud Section. The Criminal Division’s Office of International Affairs provided significant assistance in the extradition.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Thursday, November 21, 2013
Federal Jury Convicts Brunswick Woman in $4 Million Medicaid Fraud Scheme
BRUNSWICK, GA—Schella Logan Hope, 47, of Brunswick, Georgia, was convicted earlier this month by a federal jury of various health care fraud, aggravated identity theft, and money laundering offenses for her role in a $4 million scheme upon the Georgia Medicaid program. Chief United States District Court Judge Lisa Godbey Wood presided over Hope’s five-day jury trial.
According to evidence presented during the trial, Hope was a licensed dietician who ran a business located in Brunswick, Georgia, known as Hope Nutritional Services. From 2005 through 2011, Hope stole the identities of thousands of needy children between the ages of zero and five that were enrolled in Head Start programs located throughout the state of Georgia. Once Hope obtained the identities of these children, Hope fabricated patient files, falsified prescriptions from doctors, and submitted $4 million worth of claims to Medicaid for nutritional services that were not provided. Hope then used the money she stole from Medicaid to pay for luxury automobiles, designer clothing, and vacations, among other things.
Co-conspirator Arlene Murrell pled guilty before Hope’s trial to her role in the scheme. Murrell testified against Hope at trial and detailed how she helped Hope commit the fraud.
Hope was convicted of 58 counts of conspiracy to commit health care fraud; health care fraud; aggravated identity theft; and money laundering. Upon her convictions for these offenses, Chief Judge Wood remanded Hope to the custody of the United States Marshals pending sentencing in the case.
United States Attorney Edward J. Tarver stated, “Defendant Hope preyed upon American taxpayers by stealing the identities of low-income Georgia families and then billing Medicaid for over $4 million in nutrition services that were never provided. This United States Attorney’s Office will continue its efforts to prosecute all who seek to defraud American taxpayers by scamming federal programs. Because of Ms. Hope’s criminal efforts to feed her extravagant lifestyle, she will have to rely upon the federal prison system for her own nutritional services.”
“The Head Start Program provides many of our nation’s children with invaluable services and opportunities,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General, Atlanta Regional Office. “To use the Head Start Program as a vehicle to submit false and fraudulent claims to the Medicaid system is unacceptable, and the OIG will continue to pursue these kinds of egregious cases.“
Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated, “Those who defraud our publicly funded healthcare programs such as Medicaid and Medicare are taking valuable services and resources away from those in need. This guilty verdict reaffirms that the FBI will continue to provide significant investigative resources toward identifying, investigating, and presenting for prosecution such individuals that, by engaging in such criminal conduct, put themselves before others."
Georgia Attorney General Sam Olens said, “Fraud of taxpayer monies will not be tolerated in any form. Head Start is a program intended to offer assistance to children from low income families. The fact that this defendant used the Head Start Program and children in need to assist in her scam is especially appalling.”
“The Georgia Department of Community Health has made it a top priority to ferret out fraud, waste, and abuse in our Medicaid program. Our collaborative work with state and federal agencies enables us to ensure Medicaid program dollars are being used to provide health care services to Georgia’s most vulnerable populations,” said Clyde L. Reese, III, Esq., commissioner of the Georgia Department of Community Health.
At sentencing, Hope faces 10 years in prison for each of the 17 health care fraud offenses; 20 years in prison for the various money laundering offenses; and two years consecutive prison sentences for each of the various aggravated identity theft offenses. Hope also faces up to three years of supervised release and may be ordered to pay restitution to the victims in this case.
The convictions of Hope and Murrell resulted from a joint investigation by the United States Department of Health and Human Services, Office of Inspector General; the Federal Bureau of Investigation; Georgia’s Department of Community Health; and the Georgia Attorney General’s Medicaid Fraud Control Unit.
Assistant United States Attorneys Brian T. Rafferty and David Stewart, along with Assistant Attorney General Robin Daitch, prosecuted the case on behalf of the United States. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
According to evidence presented during the trial, Hope was a licensed dietician who ran a business located in Brunswick, Georgia, known as Hope Nutritional Services. From 2005 through 2011, Hope stole the identities of thousands of needy children between the ages of zero and five that were enrolled in Head Start programs located throughout the state of Georgia. Once Hope obtained the identities of these children, Hope fabricated patient files, falsified prescriptions from doctors, and submitted $4 million worth of claims to Medicaid for nutritional services that were not provided. Hope then used the money she stole from Medicaid to pay for luxury automobiles, designer clothing, and vacations, among other things.
Co-conspirator Arlene Murrell pled guilty before Hope’s trial to her role in the scheme. Murrell testified against Hope at trial and detailed how she helped Hope commit the fraud.
Hope was convicted of 58 counts of conspiracy to commit health care fraud; health care fraud; aggravated identity theft; and money laundering. Upon her convictions for these offenses, Chief Judge Wood remanded Hope to the custody of the United States Marshals pending sentencing in the case.
United States Attorney Edward J. Tarver stated, “Defendant Hope preyed upon American taxpayers by stealing the identities of low-income Georgia families and then billing Medicaid for over $4 million in nutrition services that were never provided. This United States Attorney’s Office will continue its efforts to prosecute all who seek to defraud American taxpayers by scamming federal programs. Because of Ms. Hope’s criminal efforts to feed her extravagant lifestyle, she will have to rely upon the federal prison system for her own nutritional services.”
“The Head Start Program provides many of our nation’s children with invaluable services and opportunities,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General, Atlanta Regional Office. “To use the Head Start Program as a vehicle to submit false and fraudulent claims to the Medicaid system is unacceptable, and the OIG will continue to pursue these kinds of egregious cases.“
Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated, “Those who defraud our publicly funded healthcare programs such as Medicaid and Medicare are taking valuable services and resources away from those in need. This guilty verdict reaffirms that the FBI will continue to provide significant investigative resources toward identifying, investigating, and presenting for prosecution such individuals that, by engaging in such criminal conduct, put themselves before others."
Georgia Attorney General Sam Olens said, “Fraud of taxpayer monies will not be tolerated in any form. Head Start is a program intended to offer assistance to children from low income families. The fact that this defendant used the Head Start Program and children in need to assist in her scam is especially appalling.”
“The Georgia Department of Community Health has made it a top priority to ferret out fraud, waste, and abuse in our Medicaid program. Our collaborative work with state and federal agencies enables us to ensure Medicaid program dollars are being used to provide health care services to Georgia’s most vulnerable populations,” said Clyde L. Reese, III, Esq., commissioner of the Georgia Department of Community Health.
At sentencing, Hope faces 10 years in prison for each of the 17 health care fraud offenses; 20 years in prison for the various money laundering offenses; and two years consecutive prison sentences for each of the various aggravated identity theft offenses. Hope also faces up to three years of supervised release and may be ordered to pay restitution to the victims in this case.
The convictions of Hope and Murrell resulted from a joint investigation by the United States Department of Health and Human Services, Office of Inspector General; the Federal Bureau of Investigation; Georgia’s Department of Community Health; and the Georgia Attorney General’s Medicaid Fraud Control Unit.
Assistant United States Attorneys Brian T. Rafferty and David Stewart, along with Assistant Attorney General Robin Daitch, prosecuted the case on behalf of the United States. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
Prominent Tri-State Cardiologist Sentenced to 78 Months in Prison in $19 Million Fraud Scheme and for Exposing Patients to Unncessary Medical Treatment
NEWARK, NJ—A well-known cardiologist and the founder, CEO, and sole owner of two large medical services companies in New Jersey and New York was sentenced today to 78 months in prison and ordered to pay $19 million in restitution for conspiring in a multi-million-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 sentence was announced today by U.S. Attorney Paul J. Fishman of the District of New Jersey.
Jose Katz, 69, of Closter, New Jersey, previously pleaded guilty 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. Judge Linares imposed the sentence today in Newark federal court.
“Katz prized illegal profits over patients to a staggering degree, committing record-breaking fraud and compromising care,” said U.S. Attorney Fishman. “Prison is an appropriate consequence for ripping off the government and insurance companies through the shocking exposure of patients to unneeded or untrained treatment.”
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 the 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.
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, New Jersey, 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 $75 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 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, New Jersey—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 January 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.
In addition to the prison term and restitution, Judge Linares sentenced Katz to serve three years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; the U.S. Department of Health and Human Services, Office of the Inspector General, under the direction of Special Agent in Charge Thomas O’Donnell; the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria Kelokates; the Social Security Administration, Office of the Inspector General, under the direction of Special Agent in Charge Edward J. Ryan; IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen; and criminal and civil investigators with the U.S. Attorney’s Office for the investigation leading to today’s sentence. He also thanked the Medicaid Fraud Division of the Office of the New Jersey State Comptroller for its assistance.
The government is represented by Assistant U.S. Attorney Scott B. McBride of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.
Jose Katz, 69, of Closter, New Jersey, previously pleaded guilty 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. Judge Linares imposed the sentence today in Newark federal court.
“Katz prized illegal profits over patients to a staggering degree, committing record-breaking fraud and compromising care,” said U.S. Attorney Fishman. “Prison is an appropriate consequence for ripping off the government and insurance companies through the shocking exposure of patients to unneeded or untrained treatment.”
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 the 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.
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, New Jersey, 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 $75 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 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, New Jersey—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 January 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.
In addition to the prison term and restitution, Judge Linares sentenced Katz to serve three years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; the U.S. Department of Health and Human Services, Office of the Inspector General, under the direction of Special Agent in Charge Thomas O’Donnell; the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria Kelokates; the Social Security Administration, Office of the Inspector General, under the direction of Special Agent in Charge Edward J. Ryan; IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen; and criminal and civil investigators with the U.S. Attorney’s Office for the investigation leading to today’s sentence. He also thanked the Medicaid Fraud Division of the Office of the New Jersey State Comptroller for its assistance.
The government is represented by Assistant U.S. Attorney Scott B. McBride of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.
Tuesday, November 12, 2013
Illinois Physician Indicted on Federal Charges for Allegedly Illegally Dispensing Prescription Medications
CHICAGO—A LaSalle County physician was taken into federal custody this morning after being indicted on federal charges alleging that he illegally dispensed prescription narcotics to three patients in 2012 and 2013. The defendant, Dr. Constantino Perales, was charged with 17 counts of illegally dispensing oxycodone and/or alprazolam in an indictment returned by a federal grand jury on Wednesday and made public today.
Perales, 62, of Peru, Illinois, was expected to appear at 2 p.m. today before U.S. Magistrate Judge Sidney I. Schenkier in federal court in Chicago. Perales has been in state custody on related charges, which were dismissed today by LaSalle County prosecutors. Perales’ Illinois medical license was suspended and he surrendered his DEA registration after federal and local authorities executed a search warrant at his office and he was arrested on state charges in August.
According to the indictment, Perales dispensed oxycodone and/or alprazolam outside the scope of professional practice and without a legitimate medical purpose to three different patients on 17 occasions between May 2012 and August 2013.
Each count carries a maximum penalty of 20 years in prison and a $1 million fine. If convicted, the court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The arrest and charge were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Robert J. Shields, Jr., Acting Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation, Jack Riley, Special Agent in Charge of the Drug Enforcement Administration; Lamont Pugh, III, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General in Chicago; and the Peru Police Department.
The government is being represented by Assistant U.S. Attorney Lela Johnson.
An indictment contains merely charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Perales, 62, of Peru, Illinois, was expected to appear at 2 p.m. today before U.S. Magistrate Judge Sidney I. Schenkier in federal court in Chicago. Perales has been in state custody on related charges, which were dismissed today by LaSalle County prosecutors. Perales’ Illinois medical license was suspended and he surrendered his DEA registration after federal and local authorities executed a search warrant at his office and he was arrested on state charges in August.
According to the indictment, Perales dispensed oxycodone and/or alprazolam outside the scope of professional practice and without a legitimate medical purpose to three different patients on 17 occasions between May 2012 and August 2013.
Each count carries a maximum penalty of 20 years in prison and a $1 million fine. If convicted, the court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The arrest and charge were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Robert J. Shields, Jr., Acting Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation, Jack Riley, Special Agent in Charge of the Drug Enforcement Administration; Lamont Pugh, III, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General in Chicago; and the Peru Police Department.
The government is being represented by Assistant U.S. Attorney Lela Johnson.
An indictment contains merely charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Friday, November 8, 2013
Beaumont Orthodontist Sentenced for Health Care Fraud Violations
BEAUMONT, TX—A 70-year-old Beaumont orthodontist has been sentenced to federal prison for health care fraud violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Terrence Ewing Syler pleaded guilty on June 18, 2013, to health care fraud and was sentenced to 22 months in federal prison today by U.S. District Judge Thad Heartfield. Syler was also ordered to submit to forfeiture of $829,000 and pay a $6,000 fine.
According to the information presented in court, Syler owned and operated Syler Orthodontics in Beaumont. From January 2007 to October 2012, Syler carried out a scheme to defraud Medicaid by submitting claims for palatal expanders that were never provided to his patients. As a result of the scheme, Syler received $829,333 to which he was not entitled. As part of his plea agreement, Syler has agreed to forfeiture of several bank accounts totaling just over $829,000.
The Texas Medical Assistance Program (Medicaid) is a health care benefit program, jointly funded by the state of Texas and the federal government, and helps pay for reasonable and necessary medical procedures and services provided to individuals who are deemed eligible under state low-income programs.
This case was investigated by Federal Bureau of Investigation, the U.S. Department of Health and Human Services-Office of the Inspector General (HHS-OIG), and the Texas Office of the Attorney General-Medicaid Fraud Control Unit (OAG-MFCU). Assistant U.S. Attorney Christopher T. Tortorice prosecuted this case.
Any individuals with knowledge of these or other health care fraud violations are encouraged to contact the Department of Health and Human Services’ fraud hotline at 1-800-HHS-TIPS (447-8477).
Terrence Ewing Syler pleaded guilty on June 18, 2013, to health care fraud and was sentenced to 22 months in federal prison today by U.S. District Judge Thad Heartfield. Syler was also ordered to submit to forfeiture of $829,000 and pay a $6,000 fine.
According to the information presented in court, Syler owned and operated Syler Orthodontics in Beaumont. From January 2007 to October 2012, Syler carried out a scheme to defraud Medicaid by submitting claims for palatal expanders that were never provided to his patients. As a result of the scheme, Syler received $829,333 to which he was not entitled. As part of his plea agreement, Syler has agreed to forfeiture of several bank accounts totaling just over $829,000.
The Texas Medical Assistance Program (Medicaid) is a health care benefit program, jointly funded by the state of Texas and the federal government, and helps pay for reasonable and necessary medical procedures and services provided to individuals who are deemed eligible under state low-income programs.
This case was investigated by Federal Bureau of Investigation, the U.S. Department of Health and Human Services-Office of the Inspector General (HHS-OIG), and the Texas Office of the Attorney General-Medicaid Fraud Control Unit (OAG-MFCU). Assistant U.S. Attorney Christopher T. Tortorice prosecuted this case.
Any individuals with knowledge of these or other health care fraud violations are encouraged to contact the Department of Health and Human Services’ fraud hotline at 1-800-HHS-TIPS (447-8477).
Thursday, November 7, 2013
Patient Broker of South Florida Psychiatric Hospital Sentenced for Role in $67 Million Health Care Fraud Scheme
WASHINGTON—A patient broker of a South Florida psychiatric hospital was sentenced today to serve 24 months in prison, followed by three years of supervised release, for her participation in a $67 million Medicare fraud scheme.
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; Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations’ Miami Office made the announcement.
Gloria Himmons, 54, of Union Springs, Alabama, was sentenced by U.S. District Judge Jose E. Martinez in the Southern District of Florida. In March 2013, Himmons pleaded guilty to one count of conspiracy to receive health care kickbacks and one count of receiving a health care kickback. In addition to her prison term, Himmons was ordered to pay $14 million in restitution, jointly and severally with her co-defendants.
According to court documents, Himmons was a patient broker at Hollywood Pavilion LLC (HP), a state-licensed psychiatric hospital in South Florida that purported to offer both inpatient and outpatient mental health services. Himmons would provide Medicare beneficiaries to HP in exchange for bribes and kickbacks, and she knew that the patients she provided to HP were not appropriate for inpatient psychiatric hospitalization or for outpatient mental health treatment. The patients she provided to HP included those who were not severely mentally ill, as well as substance abusers looking for rehabilitation programs. The patients did not have legitimate referrals from hospitals or doctors who had been treating acute-phase, severe mental illness.
From at least 2005 through September 2012, in exchange for bribes and kickbacks, Himmons knowingly and willfully provided to HP Medicare beneficiaries who did not need inpatient or outpatient psychiatric treatment. As a result of Himmons’s participation in this scheme, HP was improperly paid more than $7 million by Medicare. From at least 2003 through at least August 2012, HP billed Medicare approximately $67 million for services that were not properly rendered, for patients that did not qualify for the services being billed, and for claims for patients who were procured through bribes and kickbacks. Medicare reimbursed HP on approximately $40 million of those claims.
On September 10, 2013, co-defendants Karen Kallen-Zury, Daisy Miller, and Christian Coloma were sentenced on their June 2013 jury convictions. Kallen-Zury, the chief executive officer of HP, and Miller and Coloma were convicted on all counts at trial and sentenced to 300 months, 180 months, and 144 months, respectively. Kallen-Zury and Miller were ordered to pay, jointly and severally with their co-defendants, nearly $40 million in restitution. Coloma was ordered to pay, jointly and severally, more than $20 million in restitution.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Miami. This case is being prosecuted by Assistant Chief Robert A. Zink and Trial Attorneys Andrew H. Warren and Anne McNamara of the Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,500 defendants who collectively have falsely billed the Medicare program for more than $5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
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; Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations’ Miami Office made the announcement.
Gloria Himmons, 54, of Union Springs, Alabama, was sentenced by U.S. District Judge Jose E. Martinez in the Southern District of Florida. In March 2013, Himmons pleaded guilty to one count of conspiracy to receive health care kickbacks and one count of receiving a health care kickback. In addition to her prison term, Himmons was ordered to pay $14 million in restitution, jointly and severally with her co-defendants.
According to court documents, Himmons was a patient broker at Hollywood Pavilion LLC (HP), a state-licensed psychiatric hospital in South Florida that purported to offer both inpatient and outpatient mental health services. Himmons would provide Medicare beneficiaries to HP in exchange for bribes and kickbacks, and she knew that the patients she provided to HP were not appropriate for inpatient psychiatric hospitalization or for outpatient mental health treatment. The patients she provided to HP included those who were not severely mentally ill, as well as substance abusers looking for rehabilitation programs. The patients did not have legitimate referrals from hospitals or doctors who had been treating acute-phase, severe mental illness.
From at least 2005 through September 2012, in exchange for bribes and kickbacks, Himmons knowingly and willfully provided to HP Medicare beneficiaries who did not need inpatient or outpatient psychiatric treatment. As a result of Himmons’s participation in this scheme, HP was improperly paid more than $7 million by Medicare. From at least 2003 through at least August 2012, HP billed Medicare approximately $67 million for services that were not properly rendered, for patients that did not qualify for the services being billed, and for claims for patients who were procured through bribes and kickbacks. Medicare reimbursed HP on approximately $40 million of those claims.
On September 10, 2013, co-defendants Karen Kallen-Zury, Daisy Miller, and Christian Coloma were sentenced on their June 2013 jury convictions. Kallen-Zury, the chief executive officer of HP, and Miller and Coloma were convicted on all counts at trial and sentenced to 300 months, 180 months, and 144 months, respectively. Kallen-Zury and Miller were ordered to pay, jointly and severally with their co-defendants, nearly $40 million in restitution. Coloma was ordered to pay, jointly and severally, more than $20 million in restitution.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Miami. This case is being prosecuted by Assistant Chief Robert A. Zink and Trial Attorneys Andrew H. Warren and Anne McNamara of the Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,500 defendants who collectively have falsely billed the Medicare program for more than $5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
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