Owner, Executives, and Physicians at Closed Sacred Heart Hospital Indicted in Alleged Medicare Referral Kickback Conspiracy

CHICAGO―The owner and three other executives of the now-closed Sacred Heart Hospital and four physicians affiliated with the former west side facility were indicted on federal charges alleging that they collectively paid and received hundreds of thousands of dollars in illegal kickbacks in exchange for the referral of hospital patients who were insured by Medicare and Medicaid. Sacred Heart allegedly paid physicians bribes and kickbacks to induce patient referrals and increase the patient census, which, in turn, increased hospital revenue.
Sacred Heart Hospital was a 119-bed acute care facility located at 3240 West Franklin Blvd. in Chicago. The hospital closed and filed for bankruptcy this summer after Medicare payments were suspended in the aftermath of criminal charges that were first filed in April. The indictment charges only conduct involved in the alleged kickback conspiracy while a broader investigation that was outlined in the earlier criminal complaint continues.
The eight defendants were charged in a 17-count indictment that was returned by a federal grand jury late yesterday and announced today by Zachary T. Fardon, United States Attorney for the Northern District of Illinois. Five of the eight defendants were charged and arrested on April 16 this year, while three new defendants were charged in the indictment for the first time. A fifth physician associated with Sacred Heart was indicted separately for illegally prescribing prescription medications. No new arrests occurred in connection with the indictments.
Mr. Fardon announced the charges with Lamont Pugh, III, Special Agent in Charge of the Chicago Region of the U.S. Department of Health and Human Service Office of Inspector General, and Robert J. Shields, Jr., Acting Special Agent in Charge of the Chicago Office of the Federal Bureau of investigation.
The five defendants charged previously in the conspiracy case are: Edward J. Novak, 58, of Park Ridge, Sacred Heart’s owner and chief executive officer; Roy M. Payawal, 64, of Burr Ridge, executive vice president and chief financial officer; and Drs. Percy Conrad May, Jr., 75, of Chicago, Subir Maitra, 73, of Chicago, and Shanin Moshiri, also known as “Shawni Moshiri,” 58, of Chicago. All five of these defendants remain free on various bonds after they were arrested in April.
The three new defendants are: Dr. Rajiv Kandala, 41, of Chicago; Anthony J. Puorro, 57, formerly of Chicago, who was Sacred Heart’s chief operating officer; and Noemi Velgara, 64, of Chicago, who was Sacred Heart’s vice president of geriatric services and was responsible for overseeing the Golden L.I.G.H.T. medical clinics, including managing employees responsible for marketing, and recruiting and transporting patients.
All eight defendants will be ordered to appear for arraignment in U.S. District Court.
Four defendants―Novak, Payawal, Puorro, and Velgara―were each charged with one count of conspiracy to violate the federal healthcare anti-kickback statute by offering and paying kickbacks and bribes, directly and indirectly, from Sacred Heart to Drs. May, Maitra, Moshiri, and Kandala and other physicians to induce them to refer patients to the hospital for services that would be reimbursed by Medicare and Medicaid. Sacred Heart’s chief operating officer before Puorro, identified as “Administrator A,” is named as an unindicted co-conspirator.
In addition, Novak and Payawal were each charged with eight substantive counts of paying kickbacks for patients, while Drs. May, Maitra, Moshiri, and Kandala were charged with two counts each of accepting kickbacks for patient referrals. The indictment also seeks forfeiture of illegal proceeds from Novak, Payawal, and the four physicians, including the unspecified total amount of Medicare and Medicaid reimbursements made on claims submitted on behalf of hospital patients whose referral involved kickbacks and the total amount of kickbacks paid to the four physicians.
According to the indictment, Sacred Heart’s owner, executives, and administrators conspired between 2004 and April 2013 to pay physicians bribes concealed as consulting, employment, and personal services compensation, rent, and instructional stipends in return for referrals of Medicare and Medicaid patients. Although styled as payments for legitimate services, the payments actually contained disguised bribes paid to and for the benefit of Drs. May, Maitra, Moshiri, and Kandala in exchange for patient referrals.
The indictment alleges that Novak, Payawal, Puorro, and Administrator A caused Sacred Heart to pay May hundreds of thousands of dollars in bribes disguised as rent and Moshiri more than $150,000 in bribes disguised as payments for purportedly teaching podiatric surgery residents. Novak, Payawal, and Puorro allegedly caused Sacred Heart to pay Maitra at least $68,000 in bribes disguised as payments for purportedly teaching medical students at the hospital; and Kandala at least $32,000 in bribes disguised as compensation for consulting and instructional services purportedly provided to the hospital and its staff.
Payawal, Puorro, and Velgara allegedly agreed to have Sacred Heart offer to pay bribes to the hospital’s transportation staff to recruit and refer patients to the hospital, and those three defendants, together with Novak, also caused Sacred Heart to pay individuals employed as “marketers” to recruit patients.
As part of the same investigation, a fifth physician associated with Sacred Heart was indicted separately this month for allegedly illegally prescribing hydrocodone or lorazepam to four different patients without having a valid license and registration to prescribe controlled substances. The defendant, Dr. Kenneth S. Nave, 51, of Chicago, who also was arrested and charged last April, allegedly illegally used the Drug Enforcement Administration registration number of another physician when he prescribed the prescription narcotics between October and December 2012. Nave pleaded not guilty at his arraignment this week.
Each count in the eight-defendant Novak indictment carries a maximum penalty of five years in prison and a $250,000 fine and restitution is mandatory. Each count in the Nave indictment carries a maximum penalty of four years in prison and a $250,000 fine. 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, Ryan Hedges, and Terra Reynolds.
The public is reminded that an indictment 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.
The case falls under the umbrella of the Medicare Fraud Strike Force, which expanded operations to Chicago in February 2011 and is part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Justice Department and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. Dozens of defendants have been charged in health care fraud cases since the strike force began operating in Chicago.
To report health care fraud to learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

Former Los Angeles-Area Pastor Sentenced for Role in $11 Million Medicare Fraud Scheme

WASHINGTON—A pastor and owner of a Los Angeles-area medical supply company was sentenced today for his role in a power wheelchair fraud scheme that defrauded Medicare of more than $11 million.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney André Birotte, Jr. of the Central District of California; Special Agent in Charge Glenn R. Ferry of the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); Assistant Director in Charge Bill L. Lewis of the FBI’s Los Angeles Field Office; and Special Agent in Charge Joseph Fendrick of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse made the announcement.
Charles Agbu, 58, of Carson, California, was sentenced by U.S. District Judge George H. Wu to serve 87 months in prison and was ordered to pay $5,788,725 in restitution to Medicare. In December 2012, Agbu pleaded guilty to conspiracy and money laundering charges based on his role as owner and operator of Bonfee Inc., a fraudulent durable medical equipment (DME) supply company that Agbu operated with his daughter and co-defendant, Obiageli Agbu, and members of his family from a nondescript office building in Carson. Agbu admitted that he paid patient recruiters and doctors to provide him with fraudulent prescriptions for expensive, highly specialized power wheelchairs and other DME that he, Obiageli Agbu, and their co-conspirators used in submitting more than $11 million false claims to Medicare. Agbu billed the power wheelchairs to Medicare at a rate of approximately $6,000 per wheelchair even though he paid approximately $900 wholesale per wheelchair. In many cases, the Medicare beneficiaries to whom Agbu and his co-conspirators claimed they supplied the power wheelchairs and DME did not have any legitimate medical need for the medical equipment and, in some cases, never received the medical equipment from Agbu’s company. At the time Agbu engaged in this fraud, he was a pastor at Pilgrim Congregational Church in South Central Los Angeles.
On September 30, 2013 and October 2, 2013, Agbu’s co-defendants, Alejandro Maciel, 43, of Huntington Park, California, and Dr. Emmanuel Ayodele, 65, of Los Angeles, were sentenced to serve 41 and 37 months in prison and ordered to pay $5,388,755 and $6,355,949 in restitution to Medicare, respectively. Two other co-defendants, Dr. Juan Van Putten and Candelaria Estrada, have pleaded guilty to Medicare fraud charges and are scheduled for sentencing on December 12, 2013 and October 31, 2013, respectively. Obiageli Agbu was convicted by a jury on nine counts of conspiracy to commit health care fraud and health care fraud on July 19, 2013. Her sentencing date has not been set.
The case is being investigated by the FBI, HHS-OIG and the California Department of Justice 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 Central District of California. The case is being prosecuted by Trial Attorneys Jonathan T. Baum and Alexander Porter of the Criminal Division’s Fraud Section.
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare & 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.

Oakland County Doctor and Owner of Michigan Hematology and Oncology Centers Charged in $35 Million Medicare Fraud Scheme

Dr. Farid Fata, 48, of Oakland Township, Michigan, was arrested this morning and charged in a criminal complaint for his role in a health care fraud scheme which involved submitting false claims to Medicare for services that were medically unnecessary, including chemotherapy treatments, announced United States Attorney Barbara L. McQuade and Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.
Joining in the announcement were Special Agent in Charge Robert D. Foley, III, Federal Bureau of Investigation, and Special Agent in Charge Lamont Pugh, Health and Human Services-Office of Inspector General (HHS-OIG).
United States Attorney Barbara L. McQuade stated, “Our first priority is patient care. The agents and attorneys acted with great attention to detail to stop these allegedly dangerous practices as quickly as possible, and we have set up a victim hotline so that patients can access their files and get questions answered.”
FBI Special Agent in Charge Robert D. Foley, III stated, “Violating patients’ trust and placing them at risk through fraudulent abuse of our nation’s health care system is deplorable and a crime which the FBI takes most seriously. The FBI remains committed to the arrest and prosecution of those who commit health care fraud.”
HHS-OIG Special Agent in Charge Lamont Pugh stated, “The conduct alleged in this complaint is serious, not only in terms of potential Medicare dollars improperly obtained, but patient safety as well. The OIG will aggressively investigate allegations of this nature in order to ensure the safety of Medicare patients and to protect vital taxpayer dollars.”
According to the complaint, Dr. Fata owns and operates Michigan Hematology Oncology Centers (MHO), which has offices in Clarkston, Bloomfield Hills, Lapeer, Sterling Heights, Troy, and Oak Park. It was through MHO that Dr. Fata allegedly submitted fraudulent claims to Medicare for medically unnecessary services, including chemotherapy treatments, positron emission tomograph (PET) scans, and a variety of cancer and hematology treatments for patients who did not need them. In the course of the scheme, Dr. Fata falsified and directed others to falsify documents. MHO billed Medicare for approximately $35 million dollars over a two-year period, approximately $25 million of which is attributable to Dr. Fata.
The complaint further alleges that Dr. Fata directed the administration of unnecessary chemotherapy to patients in remission; deliberate misdiagnosis of patients as having cancer to justify unnecessary cancer treatment; administration of chemotherapy to end-of-life patients who would not benefit from the treatment; deliberate misdiagnosis of patients without cancer to justify expensive testing; fabrication of other diagnoses such as anemia and fatigue to justify unnecessary hematology treatments; and distribution of controlled substances to patients without medical necessity or administered them at dangerous levels.
The complaint goes on to allege that Dr. Fata directed that chemotherapy be administered to patients who had other serious medical conditions that required immediate treatment before he would permit them to go to the hospital. In one instance, a male patient fell down and hit his head when he came to MHO. Dr. Fata insisted that the patient receive his chemotherapy before he could be taken to the emergency room. MHO administered the chemotherapy, after which the patient was taken to the emergency room. The patient later died from his head injury. In the second instance, a patient came to MHO with extremely low sodium levels, which can be fatal. Dr. Fata again directed that the patient first receive chemotherapy before being taken to the emergency room. MHO administered the chemotherapy and the patient was taken to the emergency room and hospitalized.
Dr. Fata will be making his initial appearance in federal court this afternoon at 1 p.m.
Patients who have questions concerning their medical records and/or information regarding this investigation and prosecution can call the United States Attorney’s Office Information Line at 888-702-0553.
The case is being prosecuted by Assistant Chief Catherine Dick, supervisor of the Detroit Medicare Fraud Strike Force, and Trial Attorney Matthew Thuesen of the Department of Justice as well as Sarah Resnick Cohen, Deputy Chief of the Health Care Fraud Unit at the U.S. Attorney’s Office, and Justin Bidwell, Special Assistant United States Attorney. The investigations were conducted jointly by the FBI and HHS- OIG, along with the assistance of the Michigan Attorney General’s Office.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team, go to: www.stopmedicarefraud.gov.

Health Care Business Owner is Sentenced to Four Years in Prison, Pays a Million-Dollar Civil Settlement, and Agrees to 20-Year Exclusion from Medicare and Medicaid in Connection with Illegal Kickback Scheme

GRAND RAPIDS, MI—U.S. Attorney Patrick Miles announced today that Babubhai Rathod, age 44, of Okemos, Michigan, was sentenced to four years in prison and two years of supervised release for his lead role in a conspiracy to pay illegal kickbacks to health care practitioners and others to induce the referral of patients to medical clinics, physical therapy clinics, and a home health care agency. U.S. District Judge Janet T. Neff also ordered Rathod to pay $950,000 in restitution, $900,000 of which Rathod paid prior to sentencing under the terms of a related $1,000,000 civil False Claims Act settlement. As part of that civil settlement, Rathod also agreed to a 20-year exclusion from federal health care programs, including Medicare and Medicaid. In sentencing Mr. Rathod, Judge Neff described the kickback charges as “very, very serious” and having “consequences to...very important government programs in which millions of Americans participate.”
Rathod’s conviction and the related civil settlement arose from a superseding indictment and civil complaint which alleged that between at least January 2007 and January 2012, Rathod directed a scheme to pay physicians, mid-level practitioners, and others for referring patients to medical clinics (Lakeshore Spine & Pain P.C., based in Ludington, Michigan), physical therapy clinics (U.S. Rehab Services P.C., among others, based in Mt. Pleasant, Michigan), and a home health care agency (Lakeshore Home Health Care Inc., based in Lansing, Michigan). The illegal payments were made in cash and checks disguised as bonuses, mileage reimbursements, and payments under sham contracts for medical director and consulting services that were never performed. During the sentencing hearing, Judge Neff specifically noted that the physicians who received such kickbacks stole from government programs that provide “crucial medical services.” Judge Neff further emphasized, with respect to such medical professionals, that “[a] thief is a thief.”
The superseding indictment and civil complaint also alleged that between at least January 2007 and January 2012, Rathod directed a scheme where Lakeshore Spine & Pain P.C. routinely submitted claims for medical services in order to fraudulently obtain higher insurance reimbursements than those to which the company was entitled, a practice known as upcoding. Notably, Rathod was able to own and operate this network of affiliated health care companies and direct these kickback and upcoding schemes, despite the fact that in 2003, Rathod pleaded one of his physical therapy companies guilty to a felony charge of falsifying medical records and subsequently lost his physical therapy license as the result of an assault conviction involving a patient.
Rathod’s sentencing follows the felony convictions of five other persons who paid or received illegal kickbacks in exchange for referring patients to Rathod’s health care companies for physical therapy, electrodiagnostic testing, and home health care services. Judge Neff imposed the following sentences for those individuals:

• Lino S. Dial, Jr., D.O. (Physician, Edmore, Michigan). Dial was sentenced to four months’ imprisonment and $70,000 in restitution. Dial has also been excluded from federal health care programs for five years.

• Clinton J. Cornell, P.A. (Physician Assistant, Mt. Pleasant, Michigan). Cornell was sentenced to fourteen months’ imprisonment and $38,430 in restitution. Cornell is also subject to a minimum five-year exclusion from federal health care programs.

• John E. Roberts, P.A. (Physician Assistant, Mt. Pleasant, Michigan). Roberts was sentenced to four months’ imprisonment and $70,000 in restitution. Roberts has also been excluded from federal health care programs for five years.

• Natalie J. Schutte, P.A. (Physician Assistant, Edmore, Michigan). Schutte was sentenced to two years’ probation and $120,000 in restitution. Schutte has also been excluded from federal health care programs for five years.

• Raju G. Nakum (Practice Administrator, Mt. Pleasant, Michigan). Nakum was sentenced to three months’ imprisonment and $345,000 in restitution. Nakum is also subject to a minimum five-year exclusion from federal health care programs.

Two other individuals employed by Lakeshore Spine & Pain P.C. were convicted of felony health care fraud for their roles in the illegal upcoding scheme. Judge Neff imposed the following sentences for those individuals:

• Rajesh Makwana (Practice Administrator, Ludington, Michigan). Makwana was sentenced to twelve months and one day imprisonment and $71,000 in restitution. Makwana is also subject to a minimum five-year exclusion from federal health care programs.

• Sandeepkumar Patel (Biller, Ludington, Michigan). Patel was sentenced to two years’ probation. Patel has been excluded from federal health care programs for five years and will be deported from the United States.

In addition to these individuals and Rathod, a ninth individual, Kevin Witt, D.O., of Jackson, Michigan, was charged and convicted by the Michigan Attorney General’s Office on a related state felony charge for accepting kickback payments from Rathod. Witt has been excluded from federal health care programs for five years.
This case resulted from a civil lawsuit filed by a whistleblower who worked in one of Rathod’s offices. The lawsuit, known as a qui tam action, was filed under the False Claims Act and Michigan Medicaid False Claims Act, which allow private whistleblowers to bring lawsuits on behalf of the United States and the state of Michigan and receive a share of any recoveries. In this case, the United States and state of Michigan intervened in the whistleblower’s lawsuit, recovered $1,140,000 to date, and are pursuing additional claims against over a dozen other physicians and mid-level practitioners. The whistleblower has received $240,100 of these settlement proceeds, as well as additional amounts for attorney’s fees and costs.
“Whistleblowers play a key role in protecting federal health care programs from fraud and abuse, including kickback schemes that are often difficult to detect and result in the referral of unnecessary and upcoded services,” said U.S. Attorney Miles. “Paying kickbacks for patient referrals distorts the motives of health care professionals. The U.S. Attorney’s Office will continue to aggressively investigate and prosecute such kickback schemes and seek all available civil and criminal remedies including treble civil damages, monetary penalties, and felony prosecutions.”
“It is essential to maintain integrity in our health care system. Patients deserve to know that when a doctor refers them for additional treatment, the decision to do so is based upon quality health advice—not what is best for the doctor’s bottom line,” said Attorney General Bill Schuette. “Kickbacks with the Medicaid program do not just hurt patients, they affect the taxpayers whose hard-earned dollars subsidize healthcare for those in need.”
FBI Special Agent in Charge Robert D. Foley, III stated, “Those who provide health care must be held to the highest standards of ethics and integrity. The FBI remains committed to pursuing and prosecuting such criminals who abuse the system by receiving illegal kickbacks.”
“Paying kickbacks for the referral of Medicare or Medicaid patients is a serious crime,” said Lamont Pugh, III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General-Chicago Region. “Kickbacks inappropriately influence health care practitioners’ medical decision making process, lead to overutilization and/or upcoding of services, and further increase program costs. The OIG will continue to aggressively pursue all available remedies whether criminal, civil, or administrative to ensure the integrity of the Medicare and Medicaid programs and protect vital taxpayer dollars.”
These convictions and settlements were the result of a coordinated effort by the U.S. Attorney’s Office for the Western District of Michigan, the Michigan Attorney General’s Office, the Federal Bureau of Investigation, the U.S. Department of Health and Human Services-Office of Inspector General, and Blue Cross Blue Shield of Michigan.

Former Office Manager for Health Care Solutions Network Sentenced in $63 Million Medicare Fraud

WASHINGTON—A former office manager at the defunct health care provider Health Care Solutions Network Inc. (HCSN) was sentenced today in Miami to serve 68 months in prison for her role in a fraud scheme that resulted in more than $63 million in fraudulent claims to Medicare and Florida Medicaid.
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.
Lisset Palmero, 45, of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. In addition to her prison term, Palmero was sentenced to three years of supervised release and ordered to pay restitution in the amount of $17.4 million.
During the course of the conspiracy, Palmero was employed as a receptionist and office manager at HCSN, a mental health facility that purported to provide Partial Hospitalization Program (PHP) services. A PHP is a form of intensive treatment for severe mental illness.
HCSN of Florida (HCSN-FL) operated community mental health centers at two locations. According to court documents, Palmero was aware that HCSN-FL paid illegal kickbacks to owners and operators of Miami-Dade County Assisted Living Facilities (ALF) in exchange for patient referral information to be used to submit false and fraudulent claims to Medicare and Medicaid. Palmero also knew that many of the ALF referral patients were ineligible for PHP services because they suffered from mental retardation, dementia, or Alzheimer’s disease.
Court documents reveal that Palmero was aware that HCSN-FL personnel were fabricating patient medical records. Many of these medical records were created weeks or months after the patients were admitted to HCSN-FL for purported PHP treatment. Palmero was also aware that medical records were fabricated for “ghost patients” who were never admitted to the HCSN-FL PHP. During her employment at HCSN-FL, Palmero actively concealed the fabrication of medical records by preparing, and causing others to prepare, documentation that was later utilized to support false and fraudulent billing to government-sponsored health care benefit programs, including Medicare and Florida Medicaid.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported HCSN-FL mental health services.
This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under 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 Allan J. Medina and former Special Trial Attorney William J. Parente.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare & 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.

Leader of Armenian Organized Crime Ring Sentenced in Manhattan Federal Court to 37 Months in Prison for His Role in $100 Million Medicare Fraud Scheme

Preet Bharara, the United States Attorney for the Southern District of New York, announced that Armen Kazarian was sentenced today in Manhattan federal court to 37 months in prison for his involvement with the Mirzoyan-Terdjanian Organization, an Armenian-American organized crime enterprise engaged in a wide range of criminal activity. Kazarian pled guilty to racketeering conspiracy in July 2011 and was sentenced today by U.S. District Judge Paul G. Gardephe.
Manhattan U.S. Attorney Preet Bharara said, “Armen Kazarian sat at the top of a criminal organization and now he will sit in a jail cell for a long time. International mobsters who think they can export their criminal enterprises to the United States and target our government programs and our citizens are in for a rude awakening—they will face U.S. justice and be made to answer for their crimes.”
According to the indictment, other documents filed in this case, and statements made during the guilty plea proceeding:

Kazarian was a “Vor,” a term translated as “Thief-in-Law.” The term refers to a member of a select group of high-level criminals from Russia and the countries that had been part of the former Soviet Union, including Armenia. Vors offer prestige and protection to criminal organizations in return for a share of criminal earnings and use their position of authority to resolve disputes among criminals. Kazarian used his status as a Vor within the criminal community to assist the Mirzoyan-Terdjanian Organization, an Armenian-American organized crime ring that engaged in an extensive range of criminal offenses including the operation of a $100 million Medicare fraud billing ring. As part of his involvement with the group, Kazarian engaged in extortion on the organization’s and his own behalf.

* * *

In addition to the prison term, Judge Gardephe sentenced Kazarian, 47, of Glendale, California, to three years of supervised release. He was also ordered to pay a $60,000 fine.
Mr. Bharara thanked the New York Field Office of the Federal Bureau of Investigation; the New York City Police Department; the New York Field Office of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; and the New York Office of the Inspector General, Department of Health and Human Services for their work in the investigation.
The prosecution is being handled by the Office’s Organized Crime Unit. Assistant U.S. Attorneys Jennifer Burns, Arlo Devlin-Brown, and Harris Fischman are in charge of the prosecution.

Psychologist Sentenced for $1 Million Health Care Fraud

KANSAS CITY, MO—Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a psychologist practicing in the Lebanon, Missouri area was sentenced in federal court today for engaging in a $1 million scheme to defraud Medicare and Medicaid.
“Those who defraud the government are stealing from the pockets of law-abiding taxpayers,” Dickinson said. “This psychologist flagrantly abused the system to enrich himself for more than three years, but today he is being held accountable for his actions.”
Rhett E. McCarty, 67, of Lake Ozark, Missouri, was sentenced by U.S. District Judge Howard F. Sachs to three years in federal prison without parole. The court also ordered McCarty to pay $1 million in restitution to Medicaid and Medicare.
McCarty was a licensed psychologist and private practitioner who provided psychotherapy services to recipients of both Medicare and Medicaid in their homes in the Lebanon area. On August 16, 2012, McCarty pleaded guilty to health care fraud and to forgery.
“Rhett McCarty violated the trust extended to him by the American taxpayers to provide medical services to our Medicare and Medicaid beneficiaries,” said Special Agent in Charge Gerry Roy of the Health and Human Services-Office of Inspector General. “He is now being held responsible for his violations. At HHS-OIG, we will continue to work with our federal and state law enforcement and prosecution partners to ensure the solvency and integrity of our federally funded health care programs.”
Between September 17, 2008 and April 5, 2012, McCarty submitted Medicare and Medicaid claims for daily or near daily psychotherapy services to 19 beneficiaries for which he was paid $1,276,334. According to the claims that McCarty submitted, he routinely saw beneficiaries seven days per week and worked long hours every day. Moreover, according to McCarty’s claims, he worked every single day of the calendar year from mid-September 2008 through early April 2012, except for Christmas day. McCarty routinely billed for every weekend day and for all holidays except Christmas day.
Although McCarty did provide some services for most of these beneficiaries, he admitted that he did not see those beneficiaries more than once a week. McCarty also admitted that the amount he was paid by Medicare and Medicaid for services he did not provide to these 19 beneficiaries was $1 million.
McCarty also admitted that he forged (or caused another person to forge) the signatures of five of the beneficiaries on patient sign-in sheets in order to obtain $418,507 in Medicare and Medicaid payments.
This case was prosecuted by Assistant U.S. Attorney Lucinda S. Woolery. It was investigated by Health and Human Services-Office of Inspector General, the FBI, and the Medicaid Fraud Control Unit.

Two Patient Recruiters of Miami Home Health Company Plead Guilty in $20 Million Health Care Fraud Scheme

WASHINGTON—Two patient recruiters for a Miami home health care company have pleaded guilty for their participation in a $20 million home health Medicare fraud scheme. The guilty pleas were announced today by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Acting Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations, Miami Office.
Manuel Lozano, 65, and Vladimir Jimenez, 43, pleaded guilty today and January 22, 2013, respectively, to one count each of conspiracy to receive health care kickbacks. They entered their guilty pleas before U.S. District Judge Joan A. Lenard in Miami federal court.
According to the court documents, both Lozano and Jimenez were patient recruiters who worked for Serendipity Home Health, a Miami home health care agency that claimed to provide home health and therapy services to Medicare beneficiaries.
The pair admitted that from approximately April 2007 through March 2009, Lozano and Jimenez would recruit patients, for which Serendipity could bill Medicare, in exchange for kickbacks and bribes they would solicit from Serendipity’s owners and operators. Medicare was billed for home health care and therapy services on behalf of these beneficiaries that were medically unnecessary and/or not provided.
Lozano and Jimenez each face a maximum potential penalty on the conspiracy charge of five years in prison and a $250,000 fine, or twice the gain or loss from the offense. Sentencing is scheduled for April 15 and April 1, 2013, for the respective defendants.
In a related case, on June 21, 2012, Serendipity owners and operators Ariel Rodriguez and Reynaldo Navarro were sentenced to 73 and 74 months in prison, respectively, following guilty pleas in March 2012 to one count each of conspiracy to commit health care fraud. According to court documents, from approximately January 2006 through March 2009, Serendipity submitted approximately $20 million in claims for home health services that were not medically necessary and/or not provided. Medicare actually paid approximately $14 million for these fraudulent claims.
This case is being prosecuted by Senior Trial Attorney Joseph S. Beemsterboer of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since their inception in March 2007, strike force operations in nine locations have charged more than 1,480 defendants who collectively have falsely billed the Medicare program for more than $4.8 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.

Doctor and Owner of Medical Supply Company Plead Guilty in Million-Dollar Power Wheelchair Scam

United States Attorney Laura E. Duffy announced that a California medical doctor and the owner of the Oceanside Medical Supply in Long Beach, California, have both pled guilty to participating in a conspiracy to defraud the Medicare trust fund by submitting more than $1 million in fraudulent power wheelchair claims. Dr. Irving Schwartz and Jose Melendez entered their guilty pleas before Magistrate Judge Nita L. Stormes in federal court in San Diego, and, pursuant to their plea agreements, the defendants are obligated to pay restitution to the Medicare trust fund for the losses caused by their scheme.

According to court papers and admissions by the defendants, the fraudulent conspiracy focused on the sale of bogus prescriptions, with the ultimate goal being to obtain reimbursements from Medicare for expensive power wheelchairs that patients did not need and, in some cases, did not want. Dr. Irving Schwartz admitted today during his guilty plea that in 2007-2008, he would travel to El Centro, California, in search of elderly Medicare patients. Dr. Schwartz would write prescriptions for power wheelchairs, even though the patients did not need the equipment and could walk without assistance. In exchange, Schwartz collected a $300 cash kickback for each fraudulent power wheelchair prescription. One of Schwartz’s co-conspirators would then sell the power wheelchair prescriptions to Melendez, a medical supply company owner, charging him $1,000 per fraudulent prescription.

According to court papers and admissions at today’s hearing, Melendez sold some of the power wheelchair prescriptions to other co-conspirators, charging them an additional mark-up on each fraudulent prescription. As the last step in the scheme, Melendez and other co-conspirators would submit the fraudulent prescriptions to Medicare for reimbursement, billing the government thousands more per wheelchair than it had cost them to purchase and deliver the equipment. Often the unneeded equipment would sit unused in patients’ homes for years.

Dr. Schwartz admitted today in open court that he wrote at least 186 fraudulent power wheelchair prescriptions for Medicare beneficiaries in exchange for more than $55,000 in bribes and kickbacks. Melendez, the owner and operator of Oceanside Medical Services, admitted that he purchased these 186 fraudulent prescriptions and used them to submit over $830,000 in false claims to Medicare.

In a related case, co-conspirators Aristeo and Laura Tavares have pled guilty and admitted to submitting more than $250,000 in false claims based on Dr. Schwartz’s fraudulent prescriptions. In total, the scheme resulted in more than $1 million in false claims to the Medicare trust fund.

United States Attorney Duffy said, “Combating health care fraud is a top priority of the Department of Justice. When Medicare dollars are wasted on expensive and unnecessary equipment, senior citizens run the risk of not being able to obtain the legitimate medical treatment they need. In this time of fiscal austerity, we must aggressively prosecute those who pilfer Medicare dollars to line their own pockets.”

“Health care fraud schemes involving false claims of durable medical equipment cost U.S. taxpayers billions of dollars each year,” said Daphne Hearn, Special Agent in Charge of the San Diego FBI Office. “This prosecution should serve notice that the FBI will aggressively pursue those individuals and criminal enterprises who would line their own pockets at the expense of U.S. taxpayers.”

“There can be no doubt that the federal government will crack down on physicians and other individuals defrauding the Medicare program,” said Glenn R. Ferry, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General’s Los Angeles region. “When business owners conspire with doctors to pay kickbacks and write phony prescriptions, they both should expect to be brought to justice.”

The pleas are subject to final acceptance by United States District Judge Marilyn L. Huff. The defendants are scheduled to be sentenced by Judge Huff on May 6, 2013, at 9:00 a.m.

Defendants in Criminal Case No. 12cr2599-H
Irving J. Schwartz, age 67, Yuba City, California
Jose Melendez, age 51, Long Beach, California

Summary of Charges
Count one: Conspiracy to pay and receive health care kickbacks and defraud-Title 18, United States Code, Section 371
Maximum penalties: Five years in custody; $250,000 fine; three years of supervised release; and mandatory restitution

Investigating Agencies
Federal Bureau of Investigation
Department of Health and Human Services, Office of Inspector General

Miami-Area Therapist Sentenced to Prison in Florida in $205 Million Community Mental Health Fraud Scheme

WASHINGTON—Miami-area resident Nichole Eckert, former therapist at the mental health care company American Therapeutic Corporation (ATC), was sentenced today to serve 48 months in prison for participating in a $205 million Medicare fraud scheme.
The sentence was announced today by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher Dennis of the Health and Human Services’ Office of Inspector General (HHS-OIG), Office of Investigations, Miami Office.
Eckert, 35, was sentenced by U.S. District Judge Patricia A. Seitz in the Southern District of Florida. In addition to the prison term, Judge Seitz sentenced Eckert to serve three years of supervised release and ordered her to pay more than $72 million in restitution, jointly and severally with her co-defendants.
On November 15, 2012, a federal jury in the Southern District of Florida found Eckert guilty of one count of conspiracy to commit health care fraud after a 16-day trial. She has been in federal custody since her conviction.
Evidence at trial demonstrated that the defendant and her co-conspirators caused the submission of false and fraudulent claims to Medicare through ATC, a Florida corporation headquartered in Miami that operated purported partial hospitalization programs (PHPs) in seven different locations throughout South Florida and Orlando. A PHP is a form of intensive treatment for severe mental illness. The defendant and her co-conspirators also used a related company, American Sleep Institute, to submit fraudulent Medicare claims.
Evidence at trial revealed that ATC secured patients by paying kickbacks to assisted living facility owners and halfway house owners who would then steer patients to ATC. These patients attended ATC, where they were ineligible for the treatment ATC billed to Medicare and where they did not receive the treatment that was billed to Medicare. After Medicare paid the claims, some of the co-conspirators then laundered the Medicare money in order to create cash to pay the patient kickbacks.
Eckert was a therapist at ATC’s Ft. Lauderdale, Florida center from September 2005 to September 2007 and returned to ATC as a therapist from late 2009 to October 2010, when ATC closed its doors as a result of federal charges. Evidence at trial revealed that Eckert fabricated therapist notes and other documents for patient files and submissions, and taught others to fabricate them, to make it appear both that ATC patients were qualified for PHP treatment and that they were receiving the intensive, individualized treatment PHP is supposed to be. ATC used those patient files to substantiate false and fraudulent claims to Medicare. Included in these submissions were claims for patients who were in the late stages of diseases causing permanent cognitive memory loss and patients who had substance abuse issues and were living in halfway houses. These patients were ineligible for PHP treatments, and because they were forced by their assisted living facility owners and halfway house owners to attend ATC, they were not receiving treatment for the diseases they actually had.
ATC and related company Medlink pleaded guilty in May 2011 to conspiracy to commit health care fraud. ATC also pleaded guilty to conspiracy to defraud the United States and to pay and receive illegal health care kickbacks. On September 16, 2011, the two corporations were sentenced to five years of probation per count and ordered to pay restitution of $87 million. Both corporations have been defunct since their owners were arrested in October 2010. Dozens of individuals have been convicted at trial or pleaded guilty for their participation in the scheme.
Evidence at trial showed that the ATC scheme resulted in a total of $205 million in fraudulent Medicare billings.
The cases were prosecuted by Senior Trial Attorney Jennifer L. Saulino and Trial Attorney Laura M.K. Cordova of the Justice Department Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 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.

Another Orthofix Defendant Sentenced for Committing Medicare Fraud

BOSTON—A former Orthofix territory manager was sentenced yesterday for defrauding Medicare by forging patient medical records.
Michael J. McKay, 32, was sentenced by U.S. District Court Judge Denise J. Casper to one year of probation, with the first three months to be served in home confinement, and ordered to forfeit $10,000 and pay a fine of $3,000. In May 2012, McKay pleaded guilty to health care fraud.
Between 2008 and 2009, McKay was a territory manager for Orthofix, a company that manufactured and distributed bone growth stimulator medical devices that were intended to assist patients with bone fractures that did not heal properly. Medicare and many private insurance carriers have specific guidelines describing when it will pay for bone growth stimulators. When McKay received orders for patients that did not satisfy these guidelines, McKay frequently falsified the patients’ medical records to make it appear as though the order met Medicare’s rules so that Medicare would pay for a claim that otherwise would not be covered. Between 2008 and 2010, federal insurance carriers paid more than $70,000 for bone growth stimulators for claims where McKay falsified medical records. McKay altered physicians’ charts notes, changing the dates of patient visits, describing patient visits that did not occur, and inserting false diagnoses. McKay also forged prescriptions and Medicare Certificates of Medical Necessity within the orders. Orthofix fired McKay after it discovered his fraud. Even after he was fired, however, McKay continued to submit orders for stimulators by submitting them to a colleague, Derrick Field, who split the commissions with Field. Even after he was fired, McKay continued to forge chart notes, prescriptions, and CMNs in the orders he submitted to Field. On January 9, 2013, Field was sentenced to five months home confinement, two years of probation, and $44,000 in fines and forfeiture.
In addition to the McKay sentence, the Orthofix investigation has to date resulted in a number of felony charges against employees and contractors of Orthofix, including the following:
In December 2012, Orthofix was convicted of obstruction of a federal audit and ordered to pay $42 million in criminal fines and civil payments and was sentenced to probation for five years.
On January 22, 2013, Tom Guerrieri, the former vice president of sales for Orthofix, was sentenced to eight months in prison and ordered to pay $50,000 in fines and forfeiture for paying kickbacks.
In July 2012, Michael Cobb, a physician’s assistant, was sentenced to six months in prison, six months home confinement, and ordered to forfeit $10,000 and pay a $3,000 fine for accepting kickbacks from Orthofix.
In December 2011, Mitchell Salzman pleaded guilty while he was a regional manager for Orthofix and is scheduled to be sentenced on January 31, 2013.
In September 2012, Brian Racey pleaded guilty to health care while he was a territory manager for Orthofix and is scheduled to be sentenced on February 2, 2013, in the U.S. District Court for the Eastern District of Pennsylvania.
This case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations; the Federal Bureau of Investigation Boston Field Office; and the Department of Defense, Defense Criminal Investigative Service-Boston Resident Agency. It was being prosecuted by Assistant U.S. Attorneys David Schumacher and Jeremy Sternberg of Ortiz’s Health Care Fraud Unit.

Houston Man Sentenced for Health Care Fraud

SHREVEPORT, LA—United States Attorney Stephanie A. Finley announced today that Godspower Joseph Essang, 35, of Houston, Texas, was sentenced today, to 37 months in federal prison with three years’ supervised release for Medicare fraud.
Essang was also ordered to pay $613,096 in restitution to Medicare. Judge Maurice S. Hicks immediately remanded Essang into the custody of the U.S. Marshals Service to begin serving his sentence.
Essang was sentenced based on his September 28, 2012 guilty plea to one count of health care fraud. During the guilty plea hearing, Essang admitted owning and operating Shalom Equipment, a durable medical equipment company located on Woodward Avenue in Shreveport. Shalom engaged in the business of providing what were referred to as “ortho kits,” which were braces for various parts of the body. Essang admitted paying individuals to provide him with their Medicare beneficiaries and physicians information. He then used this identifying information to file false claims with Medicare for providing the “ortho kits” to Medicare beneficiaries who did not need, were not prescribed, and/or did not receive the items. Essang admitted that between August 12, 2007 and October 21, 2008, he filed approximately 736 claims, billing Medicare for $1,223,255. Medicare actually paid out $613,096 on the claims.
“Mr. Essang’s scheme was designed to defraud a program whose sole purpose is providing medical services to the elderly and the disabled,” U.S. Attorney Stephanie A. Finley stated. “His actions defrauded the program and, ultimately, U.S. taxpayers. This office will continue to vigorously pursue charges against those who steal from such programs.”
“Durable medical equipment fraud is a major problem that costs taxpayers billions in lost and wasted dollars,” said William W. Root, Assistant Special Agent in Charge, U.S. Department of Health and Human Services. “Today’s sentencing is the culmination of a concerted and joint effort by our Inspector General’s Office, the U.S. Attorney’s Office, and the Federal Bureau of Investigation to quickly bring to justice those who prey on our elderly for financial gain.”
The Federal Bureau of Investigation and the U.S. Department of Health and Human Services-Office of the Inspector General conducted the investigation. Assistant U.S. Attorney C. Mignonne Griffing prosecuted the case.

Former Miami Clinic Director Sentenced to 70 Months in Prison for Role in HIV Infusion Fraud Scheme

WASHINGTON—A former Miami HIV infusion clinic director was sentenced today to serve 70 months in prison for his role in a $26.2 million HIV infusion fraud scheme, announced Assistant Attorney General Lanny Breuer of the Criminal Division, U.S. Wifredo A. Ferrer of the Southern District of Florida, Acting 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.
Enrique Gonzalez, 67, formerly of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. In addition to his prison term, Judge Altonaga sentenced Gonzalez to serve three years of supervised release and ordered him to pay $17,590,896 in restitution to HHS.
On November 13, 2012, Gonzalez pleaded guilty to one count of conspiracy to defraud the United States, to cause the submission of false claims, and to pay health care kickbacks, and one count of conspiracy to commit health care fraud.
Gonzalez admitted that between August 2002 and March 2004, he conspired with co-defendant Ronald Harris, a Miami physician, and alleged co-conspirators to operate Physicians Med-Care and Physicians Health (together the “Physicians Clinics”), two Miami HIV infusion clinics. According to court documents, the Physicians Clinics were owned and controlled by alleged co-conspirators Carlos Benitez and his brother Luis Benitez. The Physicians Clinics purported to specialize in treating patients with HIV but were operated for the sole purpose of committing Medicare fraud, according to court documents. Gonzalez was a director of Physicians Med-Care and, at the direction of his co-conspirators, was responsible for the finances of the Physicians Clinics.
Gonzalez admitted that he agreed with his co-conspirators to handle the finances for the Physicians Clinics, moving the money paid by the Medicare program out of the Physicians Clinics’ accounts and into accounts owned and controlled by his co-conspirators. According to court documents, Harris signed blank checks that Gonzalez used to transfer funds to various Benitez-owned entities and others, as directed by his co-conspirators. In addition, Gonzalez agreed to provide cash to various co-conspirators at the Physicians Clinics to be used to pay bribes and kickbacks to the Medicare beneficiaries in return for those beneficiaries allowing the Physicians Clinics to bill the Medicare program for HIV infusion services that were not medically necessary and often not provided.
Gonzalez admitted that during his association with Physicians Med-Care, the clinic billed the Medicare program approximately $24.5 million in HIV infusion therapy claims, for which the clinic received $16.7 million in payments. Gonzalez also admitted that during his time with Physicians Health, the clinic billed Medicare approximately $1.7 million and received approximately $800,000 in payment from the Medicare program for fraudulent services.
Gonzalez was a fugitive from justice from the time of his indictment in 2008, until he was located and detained in Peru in late 2011. Gonzalez was extradited to the United States in July of 2012. Gonzalez’s daughter, Carmen Gonzalez, was indicted in a related case and is currently a fugitive.
Co-defendant Harris pleaded guilty on August 26, 2008, to one count of conspiracy to defraud the United States, to cause the submission of false claims and to pay health care kickbacks; one count of conspiracy to commit health care fraud; and three counts of submitting false claims to the Medicare program. Harris pleaded guilty in connection with his role as the medical director for the Physicians Clinics. On November 4, 2008, Harris was sentenced to serve 84 months in prison for his role in the scheme.
Carlos and Luis Benitez and Thomas McKenzie were charged separately with health care fraud and money laundering crimes in an indictment unsealed on June 11, 2008. According to the separate indictment, the defendants provided the money and staff necessary to open the Physicians Clinics, the Medicare patients that the clinics needed to bill the Medicare program and transportation for the HIV patients who visited the clinics. Carlos and Luis Benitez and McKenzie were charged for their role in committing approximately $109 million in HIV infusion fraud and money laundering through the Physicians Clinics and nine other HIV infusion clinics.
On September 18, 2008, McKenzie pleaded guilty to one count of conspiracy to commit health care fraud and one count of submitting false claims to the Medicare program and admitted to his role in a $119 million HIV infusion fraud scheme. On December 18, 2008, McKenzie was sentenced to serve 14 years in prison.
Carlos and Luis Benitez are also fugitives. Anyone with information regarding the whereabouts of the fugitives is urged to contact HHS-OIG fugitive reporting phone line at 888-476-4453.
The defendants who have not been convicted are presumed innocent unless and until proven guilty.
The Physicians Med-Care and Physicians Health case is being prosecuted by Trial Attorney N. Nathan Dimock of the Criminal Division’s Fraud Section. The case was investigated by the FBI and the DHS Office of Inspector General.
The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The Department also thanks the Peruvian National Police Interpol Unit for their assistance.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 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.

Four Sentenced to Prison in Community Mental Health Center Case

WASHINGTON—The owners of three Miami-area assisted living facilities and an affiliated psychologist were sentenced to prison today in connection with a health care fraud scheme involving now-defunct Miami-area health provider Health Care Solutions Network Inc. (HCSN) in which Medicare was billed for mental health treatments that were unnecessary or not provided.
The sentences were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Acting Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
U.S. District Judge Cecilia M. Altonaga sentenced Serena Joslin, 32, of Looneyville, West Virginia, to 63 months in prison, following her previous guilty plea to conspiracy to commit health care fraud. Raymond Rivero, 55, Daniel Martinez, 46, and Ivon Perez, 50, all of Miami, were each sentenced to 28 months in prison. All three had previously pleaded guilty to conspiracy to violate the anti-kickback statute.
According to court documents, HCSN operated community mental health centers both in Miami and North Carolina, including partial hospitalization programs (PHP)—a form of intensive treatment for severe mental illness. HCSN obtained Medicare beneficiaries to attend HCSN for purported PHP treatment that was unnecessary and, in many instances, not provided.
In Miami, HCSN obtained beneficiaries by paying kickbacks to owners and operators of assisted living facilities (ALF) or by otherwise recruiting them from the facilities and from nursing homes. Rivero, Martinez, and Perez admitted during their guilty pleas to referring Medicare beneficiaries to HCSN in exchange for cash bribes. Rivero, former owner of Miami-based God Is First ALF; Martinez, former owner of Homestead, Florida-based Mi Renacer ALF; and Perez, former owner of Homestead-based Kayleen and Denis Care Corp., are no longer permitted to operate such facilities as a condition of their guilty pleas.
According to court documents, ALF residents referred to HCSN by Rivero, Martinez, and Perez were not qualified to be placed in PHP and were only selected because they had Medicare or state of Florida Medicaid benefits. In some cases, ALF patients suffered from dementia, Alzheimer’s disease, mental retardation, or were otherwise unable to benefit from mental health services.
According to court documents, Joslin, a licensed psychologist, was hired by HCSN in North Carolina in April 2010 as a clinical coordinator and later promoted to clinical director. In those roles, she conspired with other HCSN employees to fabricate medical documents to substantiate alleged PHP treatment that was medically unnecessary and, in many instances, not even provided to the beneficiaries. Joslin admitted that many of the HCSN patients were unqualified for the PHP program because they suffered from conditions such as mental retardation and dementia and that she directed therapists to fabricate medical records to support HCSN’s fraudulent billing to the Medicare program. Joslin was also required to surrender her North Carolina license to provide mental health treatment as part of her plea agreement.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.
In addition to the prison terms, Judge Altonaga sentenced Joslin, Rivero, Martinez, and Perez each to serve three years of supervised release and ordered them to pay $4,464,728; $90,896; $76,358; and $89,245 in restitution, respectively.
The cases are being prosecuted by Special Trial Attorney William Parente and Trial Attorney Allan J. Medina of the Criminal Division’s Fraud Section. The cases were investigated by the FBI and HHS-OIG and were brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 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.

Detroit Doctor Pleads Guilty in Connection with Medicare Psychotherapy Fraud Scheme

WASHINGTON—A Detroit doctor at the center of a $13.2 million psychotherapy fraud scheme, which used the Medicare information of mentally-disabled Detroit residents to defraud Medicare, pleaded guilty today for his role in the scheme, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Robert D. Foley, III of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh, III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Chicago Regional Office.
Dr. Alphonso Berry, 51, of Orchard Lake, Michigan, pleaded guilty before U.S. District Judge Stephen J. Murphy, III in the Eastern District of Michigan to one count of conspiracy to commit health care fraud and five counts of health care fraud. Marcus Jenkins and Beth Jenkins, Dr. Berry’s co-conspirators in the scheme, pleaded guilty on January 7 and January 3, 2012, respectively, to the same charges for their roles in the scheme.
Dr. Berry admitted that he and others conspired to defraud Medicare through Quality Recreation & Rehabilitation LLC (QRR) and Procare Rehabilitation Inc., two Detroit adult day care centers. Dr. Berry admitted that he created a Medicare provider number for these businesses to allow them to bill Medicare for psychotherapy in his name. According to court documents, the Medicare recipients at QRR and Procare were severely mentally-disabled residents of Detroit adult foster care homes. Dr. Berry admitted that, although he did not provide any psychotherapy to these patients at QRR and Procare, he signed psychotherapy progress notes that were used at these companies to submit psychotherapy claims to Medicare, including claims that he provided psychotherapy to a dead person.
Court documents allege that Dr. Berry and his co-conspirators used Dr. Berry’s Medicare number to submit more than 116,000 psychotherapy claims in his name, amounting to more than $8.2 million. From 2004 through 2011, QRR and Procare submitted more than 185,000 claims to Medicare totaling more than $13.2 million for group and individual psychotherapy that was not provided. According to court documents, Medicare paid $4,777,792 on these claims.
At sentencing, scheduled for April 26, 2013, Dr. Berry faces a maximum penalty of 60 years in prison and a $1.5 million fine.
This case is being prosecuted by William G. Kanellis and Tarek Helou of the Criminal Division’s Fraud Section. It was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 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.

EMH Regional Medical Center and North Ohio Heart Center to Pay U.S. $4.4 Million to Resolve False Claims Act Allegations

WASHINGTON—EMH Regional Medical Center (EMH) has agreed to pay the United States $3,863,857, and North Ohio Heart Center Inc. (NOHC) has agreed to pay the United States $541,870 to settle allegations that they submitted false claims to Medicare, the Justice Department announced today.
EMH is a non-profit community hospital system located in Lorain County, Ohio. During the relevant time period, NOHC was an independent physician group located in Lorain County that practiced at EMH. The settlement resolves allegations that between 2001 and 2006, EMH and NOHC performed unnecessary cardiac procedures on Medicare patients. Specifically, the United States alleged that EMH and NOHC performed angioplasty and stent placement procedures on patients who had heart disease but whose blood vessels were not sufficiently occluded to require the particular procedures at issue.
“Billing Medicare for cardiac procedures that are not necessary or appropriate contributes to the soaring costs of health care and puts patients at risk. The settlement demonstrates the Department of Justice’s efforts both to protect public funds and safeguard Medicare beneficiaries,” said Stuart F. Delery, Principal Deputy Assistant Attorney General of the Justice Department’s Civil Division.
“Most doctors act responsibly,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio. “These few didn’t. Patient health and taxpayer dollars have to come before greed.”
This matter was initiated by the filing of a whistleblower complaint under the False Claims Act (FCA). Under the FCA, private citizens can bring suit for false claims on behalf of the United States and receive a share of the recovery obtained by the government. The whistleblower in this matter, Kenny Loughner, was the former manager of EMH’s catheterization and electrophysiology laboratory. As a result of the settlement, Mr. Loughner will receive $660,859 of the United States’ recovery.
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $10.1 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13.8 billion.
The investigation was jointly handled by the U.S. Attorney’s Office for the Northern District of Ohio, the Justice Department’s Civil Division, the Office of the Inspector General of the Department of Health and Human Services Cleveland Field Office, and the FBI. The claims resolved by this settlement are allegations only, and there has been no determination of liability.
The case is captioned United States ex rel. Loughner v. EMH Regional Medical Center et al., Case

EMH Regional Medical Center and North Ohio Heart Center to Pay U.S. $4.4 Million to Resolve False Claims Act Allegations

WASHINGTON—EMH Regional Medical Center (EMH) has agreed to pay the United States $3,863,857, and North Ohio Heart Center Inc. (NOHC) has agreed to pay the United States $541,870 to settle allegations that they submitted false claims to Medicare, the Justice Department announced today.
EMH is a non-profit community hospital system located in Lorain County, Ohio. During the relevant time period, NOHC was an independent physician group located in Lorain County that practiced at EMH. The settlement resolves allegations that between 2001 and 2006, EMH and NOHC performed unnecessary cardiac procedures on Medicare patients. Specifically, the United States alleged that EMH and NOHC performed angioplasty and stent placement procedures on patients who had heart disease but whose blood vessels were not sufficiently occluded to require the particular procedures at issue.
“Billing Medicare for cardiac procedures that are not necessary or appropriate contributes to the soaring costs of health care and puts patients at risk. The settlement demonstrates the Department of Justice’s efforts both to protect public funds and safeguard Medicare beneficiaries,” said Stuart F. Delery, Principal Deputy Assistant Attorney General of the Justice Department’s Civil Division.
“Most doctors act responsibly,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio. “These few didn’t. Patient health and taxpayer dollars have to come before greed.”
This matter was initiated by the filing of a whistleblower complaint under the False Claims Act (FCA). Under the FCA, private citizens can bring suit for false claims on behalf of the United States and receive a share of the recovery obtained by the government. The whistleblower in this matter, Kenny Loughner, was the former manager of EMH’s catheterization and electrophysiology laboratory. As a result of the settlement, Mr. Loughner will receive $660,859 of the United States’ recovery.
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $10.1 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13.8 billion.
The investigation was jointly handled by the U.S. Attorney’s Office for the Northern District of Ohio, the Justice Department’s Civil Division, the Office of the Inspector General of the Department of Health and Human Services Cleveland Field Office, and the FBI. The claims resolved by this settlement are allegations only, and there has been no determination of liability.
The case is captioned United States ex rel. Loughner v. EMH Regional Medical Center et al., Case No. 1:06-cv-2441 (N.D. Oh.).

Shelby Woman Pleads Guilty to Defrauding Medicaid of $8 Million, Aggravated Identity Theft, and Tax Fraud

CHARLOTTE—A Shelby, North Carolina woman pleaded guilty today for her involvement in a health care fraud scheme that defrauded Medicaid of $8 million for sham mental and behavioral health services, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. In addition to defrauding Medicaid, Victoria Finney Brewton, 37, also pleaded guilty to stealing a therapist’s identity to commit the fraud and to filing a false tax return.
U.S. Attorney Tompkins is joined in making today’s announcement by North Carolina Attorney General Roy Cooper, who oversees the North Carolina Medicaid Investigations Division (MID); Roger A. Coe, Acting Special Agent in Charge of the FBI, Charlotte Division; Jeannine A. Hammett, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI); and Derrick Jackson, Special Agent in Charge, Department of Health and Human Services, Office of the Inspector General (HHS-OIG), Office of Investigations, Atlanta Region.
Brewton pleaded guilty today before U.S. Magistrate Judge David Keesler to seven counts of health care fraud and health care fraud conspiracy, one count of aggravated identity theft, and one count of filing a false tax return. At today’s plea hearing, the defendant admitted that from 2008 to 2012, Brewton, her co-defendant Linda Radeker, also of Shelby, and others submitted in excess of $8 million in false claims to Medicaid. According to filed court documents and statements made in court, Brewton operated a series of after-school and summer childcare programs in Shelby. Brewton recruited juvenile Medicaid recipients to her childcare programs by promising that the program would be free for Medicaid recipients. After Brewton obtained the children’s and families’ Medicaid recipient numbers, she used this information to fraudulently bill Medicaid for mental and behavioral health services that were never provided.
According to the criminal information, Brewton was not licensed or qualified to provide mental and behavioral health services, and she was not approved by Medicaid. Instead, Brewton enlisted the assistance of other complicit Medicaid-approved providers, such as Linda Radeker and, in other instances, stole the identity of Medicaid-approved providers in order to accomplish the fraud. Court documents indicate that Brewton conspired with Radeker, a licensed professional counselor enrolled with North Carolina Medicaid, to submit claims to Medicaid making it appear that Radeker had provided the claimed mental and behavioral health services when, in fact, Radeker did not provide any of the services. Radeker and Brewton then split the Medicaid payments 50/50 for these false claims.
Filed documents also indicate that Brewton hired licensed therapist K.S.M. in October 2010 to provide services at Brewton’s company, Healing Hearts. Although K.S.M. provided some mental and behavioral health services while she worked at Healing Hearts, Brewton submitted false and fraudulent claims to Medicaid through K.S.M.’s Medicaid provider number far in excess of the services actually provided by K.S.M. In or about October 2011, K.S.M. left Healing Hearts after learning that Brewton had submitted false claims through K.S.M.’s Medicaid provider number. Thereafter, Brewton misappropriated K.S.M.’s identity, specifically her Medicaid provider number, in order to continue to submit fraudulent claims to Medicaid after K.S.M. was no longer employed at Healing Hearts. Specifically, the defendant admitted that on or about October 27, 2011, Brewton submitted an Electronic Funds Transfer Authorization Agreement to Medicaid directing that reimbursements for claims submitted through K.S.M.’s provider numbers be deposited into a bank account held and controlled by Brewton. From in or about April 2011 to May 2012, Brewton submitted in excess of $1.8 million in false claims through K.S.M.’s provider number which K.S.M. did not provide. According to court documents, Brewton also misused the Medicaid provider numbers of other therapists employed by her companies in order to submit false claims to Medicaid through their numbers.
As part of her plea, Brewton also admitted that she defrauded the United States by filing a false tax return for the year 2009 that intentionally failed to report the income Brewton received from her scheme to defraud Medicaid. She also failed to file tax returns for 2010 and 2011, which further masked the income from her fraud scheme. Brewton agreed to forfeit a 2005 Dodge Magnum which was seized as the proceeds of fraud during the investigation.
Brewton, who was released on bond, faces a mandatory two years in prison consecutive to any other term of imprisonment and a $250,000 fine for the aggravated identity theft charge, a maximum term of 10 years in prison, and a $250,000 fine for the health care fraud charges; and a maximum term of three years in prison and a $250,000 fine for the filing of a false tax return charge. In her plea agreement, Brewton has agreed to pay full restitution to Medicaid for any losses resulting from her criminal scheme. The final restitution amount will be determined by the court at Brewton’s sentencing hearing, which has not been scheduled yet.
Radeker pleaded guilty to charges of health care conspiracy and money laundering on September 13, 2012, and is awaiting sentencing.
The investigation into Brewton was handled by the FBI, MID, IRS, and HHS-OIG. Special assistance to the task force was provided by the North Carolina Division of Medical Assistance, Program Integrity Section. The prosecution was handled by Assistant U.S. Attorneys Kelli Ferry and Jenny Grus Sugar of the U.S. Attorney’s Office in Charlotte.
The investigation and charges are the work of the Western District’s joint Health Care Fraud Task Force. The task force is multi-agency team of experienced federal and state investigators, working in conjunction with criminal and civil Assistant United States Attorneys, dedicated to identifying and prosecuting those who defraud the health care system, and reducing the potential for health care fraud in the future. The task force focuses on the coordination of cases, information sharing, identification of trends in health care fraud throughout the region, staffing of all whistleblower complaints, and the creation of investigative teams so that individual agencies may focus their unique areas of expertise on investigations. The task force builds upon existing partnerships between the agencies, and its work reflects a heightened effort to reduce fraud and recover taxpayer dollars.

Medical Assistant Pleads Guilty to Conspiracy to Bill Medicare for Unlicensed Physician’s Services

NEWARK—A medical assistant at a pair of large medical services companies with offices in New Jersey and New York admitted today to conspiring with the companies’ chief executive officer to defraud Medicare over a four-year period by performing illegal, unlicensed physicians’ services for patients, U.S. Attorney Paul J. Fishman announced.
Mario Roncal, 61, of Woodland Park, New Jersey, pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to an indictment charging him with one count of conspiracy to commit health care fraud.
According to documents filed in this case and statements made in court:
In 1988, Roncal received a medical degree from San Juan Bautista School of Medicine in San Juan, Puerto Rico. Since that time, however, he was never licensed to practice medicine in New Jersey, New York, or any other state in the United States. In 2000 and 2002, Roncal was advised by the New Jersey Board of Medical Examiners that he were ineligible to obtain a medical license in New Jersey because his medical school was not accredited and he lacked certain requirements for international medical students to obtain a license in the United States.
From 2004 to the present, Roncal was employed ostensibly as a medical assistant for Cardio-Med Services LLC in New Jersey and for Comprehensive Healthcare & Medical Services LLC in Manhattan and Queens, New York. These companies were owned and operated by the CEO and head physician at Cardio-Med and Comprehensive Healthcare, who is a board-certified cardiologist licensed to practice medicine in New Jersey and New York, and who is identified in the indictment as the “CEO-physician.”
According to Roncal, from 2004 through at least 2008, he conspired with the CEO-physician to cause Cardio-Med and Comprehensive Healthcare to submit false billing claims to Medicare representing that physicians’ services had been provided by the CEO-physician when those services had, in fact, been provided by Roncal. Roncal admitted that he held himself out to fellow employees and to patients as “Dr. Roncal” and that he examined new patients as well as the CEO-physician’s follow-up patients. He also admitted that he ordered diagnostic tests for patients; diagnosed patients with medical conditions, diseases, and the like; and recommended and prescribed courses of treatment, including surgery and enhanced external counter pulsation (or EECP) for patients. Roncal stated that he intentionally ordered unnecessary diagnostic tests for the patients he unlawfully treated and that he willfully misdiagnosed patients with diseases and conditions such as coronary artery disease and angina, for the purpose of fraudulently prescribing and administering treatments of EECP, at the direction of the CEO-physician. To disguise that he, rather than the CEO-physician, was providing these physicians’ services to patients, Roncal forged the CEO-physician’s signature on paperwork associated with these unlawful services, including on prescription pads and patient charts.
The count to which Roncal pleaded guilty is punishable by a maximum potential penalty of 10 years in prison. Sentencing is scheduled for April 17, 2013.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge David Velazquez; the U.S. Department of Health and Human Services, Office of the Inspector General, under the direction of Special Agent in Charge Thomas F. O’Donnell; the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Marie 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 Acting Special Agent in Charge Shantelle P. Kitchen; and criminal investigators at the U.S. Attorney’s Office, for the investigation leading to the guilty plea.
The case is being prosecuted by Assistant U.S. Attorney Scott B. McBride the U.S. Attorney’s Office’s Health Care and Government Fraud Unit.

Owner of Detroit Adult Day Care Centers Pleads Guilty in Connection with Medicare Psychotherapy Fraud Scheme

WASHINGTON—The owner of several Detroit-area adult day care centers pleaded guilty today for her role in a $13.2 million psychotherapy fraud scheme, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Robert D. Foley, III of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh, III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Chicago Regional Office.
Beth Jenkins, 48, of Farmington Hills, Michigan, pleaded guilty to one count of conspiracy to commit health care fraud and five counts of health care fraud before U.S. District Judge Stephen J. Murphy, III in the Eastern District of Michigan.
Jenkins admitted that she and others conspired to defraud Medicare through Quality Recreation & Rehabilitation LLC (QRR) and Procare Rehabilitation Inc., two adult day care centers she owned and operated with alleged co-conspirators. According to court documents, Jenkins and her alleged co-conspirators owned and operated several Detroit-area adult foster care homes (AFCs) that housed severely mentally disabled Medicare recipients. Court documents allege that Medicare beneficiaries living at AFCs, some of which were owned and operated by Jenkins and her alleged co-conspirators, were transported to QRR and Procare by Jenkins and others. According to court documents, Jenkins and her alleged co-conspirators used the AFC residents’ Medicare information to bill Medicare for group and individual psychotherapy that was never provided.
From 2004 through 2011, Jenkins and her alleged co-conspirators submitted more than 185,000 claims to Medicare totaling more than $13.2 million for group and individual psychotherapy that was not provided. According to court documents, Medicare paid $4,777,792 on these claims.
At sentencing, scheduled for April 19, 2013, Jenkins faces a maximum penalty of 60 years in prison and a $1,500,000 fine.
Jenkins’s co-defendants, Dr. Alphonso Berry and Marcus Jenkins, Beth Jenkins’s husband, are scheduled for trial on January 8, 2013. They are presumed innocent until proven guilty at trial.
This case is being prosecuted by William G. Kanellis and Tarek Helou of the Criminal Division’s Fraud Section. It was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 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.