Articles Posted in Medicaid Fraud

telemed-300x167Having recently written here about “target letters,” I thought it would be helpful to discuss what happens in a fairly garden variety Medicare prosecution.  A few weeks back, a Florida man who the owner of a durable medical equipment company was charged in federal court in Savannah, Georgia, for his involvement in a Medicare kickback and telemedicine conspiracy.

Patrick Wolfe of Belleair Beach, FL, was accused in an information (a charging document that substitutes for a grand jury indictment) of conspiring to pay kickbacks for “leads,” which as it turns out were not actually “leads” at all.  The so-called “leads” were signed orders from nurse practitioners and doctors, which were then submitted to Medicare Part B and Medicare Part C for payment through Wolfe’s DME Georgia based company, Wilmington Island Medical Inc.  Reading the information lays out how the scheme operated.

Apparently, the feds have been on to Wolfe for a while.  In fact, Wolfe is the 25th defendant who has been charged in a far reaching telemedicine conspiracy arising out of “Operation Brace Yourself” and “Operation Double Helix” as part of the largest Medicare fraud ever prosecuted in the Southern District of Georgia.  As is so often the case, I would say that other defendants looking to cut a deal with prosecutors in hopes of lessening their sentence by way of earning a §5k1.1 motion for downward departure or a Rule 35 motion reduction of sentence probably fingered Wolfe as someone who was paying kickbacks for bogus leads.

BigStock_KickBackTypically, when I meet with clients for the first time, it never ceases to amaze me that they have little or no idea what constitutes Medicare fraud is and didn’t know they couldn’t be doing the things they were doing.  So, I decided to write this post to give a primer to explain: what is Medicare Fraud?

For those who are working in the medical field, whether they are doctors, corporate owners of medical practices, pharmacists, pharmacy owners, lab owners, durable medical equipment business owners, just to name a few, it can’t be overemphasized that it is essential to be familiar with the basics of Medicare fraud.

With this in mind, I want to make sure you are informed about how someone can get themselves in trouble. In general, Medicare fraud refers to submitting a false claim in a Medicare beneficiary’s name to a governmental sponsored health care program for reimbursement.

Corrupt-doctorIn a nutshell, the federal Anti-Kickback Statute and Stark Law make it a crime with serious penalties for providers of medical services to pay or accept any form of remuneration such as kickbacks or anything of value in exchange for receiving referrals of patients who obtain medical treatment paid by government healthcare programs including Medicare and Medicaid, and from entering into certain kinds of financial relationships.

The Anti-Kickback Statute and the Stark Law are designed to keep medical treatment decisions independent from any influence of possible financial gain. The Anti-Kickback Law and the laws prohibiting other unlawful financial arrangements are designed to prevent healthcare providers from referring patients for healthcare services that are not medically necessary.

The Department of Justice has declared that, “[p]atients are entitled to be sure that the care they receive is based on their actual medical needs rather than the financial interests of their physician.”

On June 4, 2020, an indictment was unsealed in Tampa at the U.S. District Court for the Middle District of Florida charging four Florida men with among other crimes, conspiracy to defraud the United States and paying or receiving health care kickbacks.

The charges arise out of the defendants’ participation in a multi-million dollar conspiracy aimed at defrauding TRICARE, the health care benefit program of the U.S. Department of Defense that provides health care coverage for active duty service members, the National Guard and Reserve members, retirees, their families and survivors.

compounding-service-940x600-1-300x191The indictment alleges that the co-conspirators owned and operated Florida Pharmacy Solutions Inc. (FPS) aimed at targeting TRICARE beneficiaries. Florida Pharmacy Solutions submitted claims to TRICARE for expensive prescription drugs that were specially compounded for beneficiaries, but were not prescribed legitimately, and were generated by paying illegal bribes and kickbacks.  The indictment alleges that the defendants submitted claims to TRICARE of more than $54 million for compounded drug prescriptions and that TRICARE paid out roughly $41 million to FPS.

TRENTON, NJ (Nov. 22, 2019) Kenneth Sun, M.D., 58, of Easton, PA, pleaded guilty to one count of conspiracy to defraud the United States and to pay and receive health care kickbacks in U.S. District for the District of New Jersey.

Subsys-300x300Sun admitted that from 2012 to 2016, he conspired to solicit and receive more than $140,000 in bribes and kickbacks from Insys Therapeutics, a pharmaceutical company headquartered in Arizona, in exchange for him prescribing more than 28 million micrograms of Subsys, a powerful opioid narcotic that is designed for rapid entry into a patient’s bloodstream by being sprayed under the tongue.

Subsys contains fentanyl, a synthetic opioid pain reliever that is approximately 50 to 100 times more potent than morphine.  The U.S. FDA approved Subsys solely for the “management of breakthrough pain in cancer patients who are already receiving and who are tolerant to around the clock therapy for their underlying persistent cancer pain.”  Dr. Sun admitted that he broke the law when he prescribed Subsys to patients for whom Subsys was completely medically unnecessary, not eligible for insurance reimbursement and unsafe.

doc-thumbCHICAGO (September 25) – Two owners of Rosner home health care agency near Chicago and two physicians were among nine people charged in a 27-count indictment with federal offenses for paying and receiving kickbacks in exchange for the referral of Medicare patients for home health care services.

Three defendants were charged with one count of conspiracy to pay illegal kickbacks for Medicare patient referrals. Eight of the nine defendants were charged with two or more counts of violating the anti-kickback statute.

According to the indictment between January 2008 and July 2012, three defendants conspired with others to pay kickbacks and bribes to doctors. The amount of kickbacks varied from $300 to $600 for each new patient’s completion of five home health visits in one cycle and ranged between the same amounts for the repeat admission of a previous patient in a new cycle of home health care.

money-pile.jpgMIAMI (June 21) – Two Miami home health care agency owners of a were sentenced to 73 and 74 months in prison for their participation in a $20 million home health Medicare fraud scheme.

Ariel Rodriguez was to 73 months in prison and three years of supervised release and Reynaldo Navarro was sentenced to 74 months in prison followed by three years of supervised release and were ordered to pay $14 million in restitution. Rodriguez, 41, Navarro, 37, were the owners of Serendipity Home Health Inc., a Miami home health agency that was supposed to provide home health care and physical therapy services to qualifying Medicare beneficiaries.

According to court records, Rodriguez and Navarro paid kickbacks and bribes to patient recruiters in exchange for the recruiters providing patients to their home health care agency, as well as prescriptions, plans of care and certifications for medically unnecessary therapy and home health services for Medicare beneficiaries. The prescriptions, POCs and medical certifications were then submitted to Medicare for reimbursement.


Eight Others, Including Senior Managers, Previously Sentenced for
Felony Charges Arising out of Maxim’s Activities

TRENTON, N.J. – A former senior manager and 13-year employee of Maxim Healthcare Services, Inc. (“Maxim”), was sentenced today to five months in prison and five months of home confinement with electronic monitoring for his involvement in the unlicensed operation of Maxim office that billed nearly a million dollars to government health care programs, J. Gilmore Childers, First Assistant U.S. Attorney announced.
Bryan Lee Shipman, 38, of Athens, Ga., pleaded guilty in Trenton federal court on June 17, 2010, to an Information charging him with one count of health care fraud. Shipman was charged in connection with his role as a regional account manager supervising Maxim’s decision to open and operate Maxim’s Gainesville, Ga., office without a license from 2008 through 2009, when he and others directed billings from that office to be submitted for reimbursement by the Medicaid program as if they were from another, licensed office. Shipman entered his guilty plea before U.S. District Judge Anne E. Thompson, who also imposed the sentence today in Trenton federal court.
On Sept. 12, 2011, Maxim – one of the nation’s leading providers of home healthcare services – entered into a settlement agreement to resolve criminal and civil charges relating to a nationwide scheme to defraud Medicaid programs and the Veterans Affairs program of more than $61 million. Maxim was charged in a criminal Complaint with conspiracy to commit health care fraud, and entered into a Deferred Prosecution Agreement (“DPA”) with the Department of Justice. The agreement allows Maxim to avoid a health care fraud conviction on the charges if it complies with the DPA’s requirements. As required by the DPA, Maxim agreed to pay approximately $150 million – a criminal penalty of $20 million and approximately $130 million in civil settlements in the matter, including to settle federal False Claims Act claims.
Shipman is one of nine individuals – eight former Maxim employees, including three senior managers, and the parent of a former Maxim patient – to have pleaded guilty to and been sentenced on felony charges arising out of the submission of fraudulent billings to government health care programs, the creation of fraudulent documentation associated with government program billings, or false statements to government health care program officials regarding Maxim’s activities.
According to documents filed in this and related cases and statements made in court:
Shipman had been employed by Maxim for 13 years, the last eight as a regional account manager. As a regional account manager, Shipman reported directly to one of two nationwide vice presidents, who in turn reported to Maxim’s president. He also managed 13 offices in 2008 with hundreds of employees and total annual sales of more than $42 million, much of which derived from government programs. In his last full year of employment, Shipman earned more than $325,000, and was among the top 25 individuals at Maxim in terms of compensation out of the more than 80,000 individuals employed by Maxim in that year.
Shipman’s annual compensation – which ranked him within the top .03% of the Company – was based to a significant degree on meeting sales goals. Shipman said his superiors demanded levels of growth based “not on any market analysis, but simply on a belief that dramatic growth was necessary regardless of market conditions.” It was in response to that pressure, Shipman said, that he authorized and supervised the unlicensed operation of the Gainesville office.
At one point, when Maxim employees believed a state regulator would be visiting the office, lower-level employees were directed by Shipman and others to provide false information to the state regulator in an effort to prevent the Medicaid program from learning about the unlicensed operation of the office.
In addition to the prison term, Judge Thompson sentenced Shipman to two years of supervised release and ordered him to pay a $10,000 fine.
The other eight individuals who pleaded guilty were sentenced by Judge Thompson as follows:
Gregory Munzel, 35, of Charleston, S.C., was employed as a regional account manager, reporting directly to a vice president, responsible for Maxim offices throughout the southeastern United States. He pleaded guilty on Dec. 4, 2009, to one count of making false statements relating to health care fraud matters. During his plea hearing, Munzel admitted that he was aware individuals he supervised were submitting time cards for work that had not actually been done – a practice Munzel said was in response to pressure from Maxim superiors to increase revenue. Munzel also acknowledged forging caregiver credentials such as CPR cards throughout his time at Maxim, in order to make it appear that the caregivers were properly credentialed, when they were not. Munzel indicated he learned the practice from his supervisors when he first joined Maxim, and that those under him engaged in the practice when he took on a leadership role with the company. Munzel was sentenced on Sept. 29, 2011, to three months of home confinement as part of a two-year term of probation. Munzel was also ordered to pay a $1,000 fine.
Matthew Skaggs, 39, was employed as a regional account manager, reporting directly to a vice president, responsible for Maxim’s offices in Texas. He pleaded guilty on Sept. 23, 2010, to making false statements relating to health care fraud matters. During his plea hearing, Skaggs acknowledged having knowingly made false statements to a surveyor from Texas’ Medicaid Program, who was investigating the operation of an unlicensed Maxim office in Houston. Skaggs was sentenced on June 10, 2011, to a three-year term of probation and ordered to pay a $4,000 fine.
Andrew Sabbaghzadeh, 30, of Clay, N.Y., was employed as an account manager; and Jason Bouche, 27, of Paradise Valley, Ariz., was employed as a recruiter at Maxim’s Tempe, Ariz. office. They pleaded guilty to health care fraud on Nov. 4, 2009, and April 23, 2010, respectively. During their plea hearings, Sabbaghzadeh and Bouche acknowledged creating fraudulent time cards in order to bill government programs. They acknowledged that in some instances, Maxim employees cut signatures from legitimate time cards and pasted them onto forged time cards in order to submit them for reimbursement. Sabbaghzadeh was sentenced on Sept. 26, 2011, to six months of home confinement as part of a three-year term of probation. Sabbaghzadeh was also ordered to pay a $2,000 fine. Bouche was sentenced on Nov. 17, 2011, to a two-year term of probation and ordered to pay a $500 fine.
Donna Ocansey, 49, of Medford, N.J., was employed as a director of clinical services (supervising nurse) in Maxim’s Cherry Hill, N.J., office. She pleaded guilty on May 28, 2010, to making false statements relating to health care fraud matters. Ocansey, a registered nurse (RN), had responsibility for, among other things, ensuring that Medicaid-required supervisory visits of patients were conducted periodically – meaning that an RN periodically visited each patient to check each patient’s condition and the care the patient was receiving from Maxim Home Health Aides, who lack the skills and training of RNs. During her plea hearing, Ocansey acknowledged that she fabricated documentation in order to make it appear that other nurses had conducted Medicaid-mandated supervisory visits, when in fact they had not. Ocansey stated that she fabricated documentation in response to pressure from her superiors at Maxim, who expected her to make sure that all supervisory visits were completed without providing adequate resources for her to do so. Ocansey was sentenced on Oct. 18, 2011, to four months of home confinement as part of a a three-year term of probation. Ocansey was also ordered to pay a $2,000 fine.
Mary Shelly Janvier-Pierre, 43, of Lake Worth, Fla., and Sandy Cave, 39, of West Palm Beach, Fla., pleaded guilty to health care fraud on Feb. 1, 2010, and June 21, 2010, respectively. During their plea hearings, Janvier-Pierre, who had been employed by Maxim’s West Palm Beach office as a licensed practical nurse; and Cave, the mother of a former pediatric patient of Maxim, admitted to their roles in a scheme to fraudulently bill Medicaid, through Maxim, for services that were not rendered. Janvier-Pierre and Cave acknowledged that they agreed to submit billings as if Janvier-Pierre was taking care of Cave’s child, when she was not. Janvier-Pierre and Cave then split the money Janvier-Pierre received for purportedly providing the care. As a result of the scheme, Maxim was paid more than $70,000 by Florida’s Medicaid program. Janvier-Pierre was sentenced on Sept. 21, 2011, to six months of home confinement as part of a three-year term of probation. Cave was sentenced on Nov. 17, 2011, to five months of home confinement as part of a three-year term of probation. Cave was also ordered to pay a $1,000 fine.
Marion Morton, 45, of North Charleston, S.C., was employed as a home health aide and personal care assistant by Maxim’s Charleston, S.C., office. He pleaded guilty on May 3, 2010, to one count of making false statements relating to health care fraud matters. During his plea hearing, Morton acknowledged that, at the instruction of Maxim employees, he fabricated timecards reflecting work he had not done. On multiple occasions, Maxim submitted bills to Medicaid based on timecards which showed he worked more than 24 hours on certain days. Morton was sentenced on May 24, 2011, to a three-year term of probation and ordered to pay a $5,000 fine.
First Assistant U.S. Attorney Childers credited special agents and investigators from HHS/OIG, under the direction of Special Agent in Charge Thomas ODonnell; the FBI, under the direction of Special Agent in Charge Michael B. Ward; and VA OIG, under the direction of Special Agent in Charge Jeffrey Hughes for conducting the multi-year investigation.
The government is represented by Assistant U.S. Attorney Jacob T. Elberg of the U.S. Attorney’s Office Health Care and Government Fraud Unit.
Defense counsel:
Maxim: Laura Laemmle-Weidenfeld Esq.; Robert Luskin Esq., Washington
Gregory Munzel: John Lacey Esq., Roseland, N.J.
Bryan Lee Shipman: Peter Bennett Esq., Middletown, N.J.
Matthew Skaggs: David Sellinger Esq., Florham Park, N.J.
Andrew Sabbaghzadeh: James Hopkins Esq., Syracuse, N.Y.
Jason Bouche: Chester Keller Esq., Assistant Federal Public Defender, Newark
Donna Ocansey: Jeffrey Carney Esq., Hackensack, N.J.
Mary Shelly Janvier Pierre: Michael Salnick Esq., West Palm Beach, Fla.
Sandy Cave: Chester Keller Esq., Assistant Federal Public Defender, Newark
Marion Morton: John Renner Esq., Marlton, N.J.

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