DC

July 16, 2010

Medicare Fraud Strike Force Charges 94 Doctors, Health Care Company Owners, Executives and Others for More Than $251 Million in Alleged False Billing

WASHINGTON – Ninety-four people have been charged for their alleged participation in schemes to collectively submit more than $251 million in false claims to the Medicare program in the continuing operation of the Medicare Fraud Strike Force in Miami; Baton Rouge, La.; Brooklyn, N.Y.; Detroit and Houston, announced Attorney General Eric Holder, Department of Health and Human Services (HHS) Secretary Kathleen Sebelius, FBI Director Robert Mueller and Daniel R. Levinson, Inspector General of HHS. The operation announced today is the largest federal health care fraud takedown since Medicare Fraud Strike Force operations began in 2007.

The joint DOJ-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. More than 360 law enforcement agents from the FBI, HHS-Office of Inspector General (HHS-OIG), multiple Medicaid Fraud Control Units, and other state and local law enforcement agencies participated in today’s operation.

"Our continued Strike Force operations reflect the unprecedented commitment that inspired the creation of the Health Care Fraud Prevention and Enforcement Action Team in May 2009," said Attorney General Holder. "With today’s arrests, we’re putting would-be criminals on notice: Health care fraud is no longer a safe bet. The federal government is working aggressively – and collaboratively – to pursue health care criminals around the country and to bring these offenders to justice."

"Today’s arrests send a strong message that attempts to defraud Medicare will not be tolerated," said Secretary Sebelius.  "With the help of new tools in the Affordable Care Act, including stiffer penalties and better information sharing, we will continue to work with our federal, state and local partners to stamp out Medicare fraud and protect beneficiaries and the American taxpayer."

Charges were unsealed today against 94 individuals who are accused of various Medicare fraud-related offenses, including conspiracy to defraud the Medicare program, criminal false claims, violations of the anti-kickback statutes and money laundering. The charges are based on a variety of fraud schemes, including physical therapy and occupational therapy schemes, home health care schemes, HIV infusion fraud schemes and durable medical equipment (DME) schemes. Thirty-six defendants charged in these schemes have been arrested in Miami, New York, Baton Rouge and Detroit and additional arrests are expected throughout the day.

According to the court documents, the defendants charged today participated in schemes to submit claims to Medicare for treatments that were medically unnecessary and oftentimes, never provided. In many cases, indictments and complaints allege that beneficiaries accepted cash kickbacks in return for allowing providers to submit forms saying they had received the treatments that, in reality, were unnecessary or never provided. Collectively, the doctors, health care company owners, executives and others charged in the indictments and complaints are accused of conspiring to submit more than $251 million in false claims to the Medicare program.

In Miami, 24 defendants were charged for allegedly participating in various fraud schemes that led to approximately $103 million in false billings. According to court documents, the fraud schemes involved fraudulent billing for HIV infusion services, home health care and physical therapy services, DME and pharmaceutical medications. The defendants include owners and operators of companies, doctors, nurses, and patient recruiters, as well as a medical biller who is alleged to have billed approximately $49 million for fraudulent services.

Thirty-one defendants were charged in Baton Rouge for various schemes allegedly involving fraudulent claims for DME totaling approximately $32 million. The defendants include the owners and operators of nine different purported medical services companies and four doctors, 14 patient recruiters and other individuals who allegedly worked at the medical services companies.

Twenty-two defendants were charged in Brooklyn for their alleged participation in schemes to submit fraudulent claims totaling approximately $78 million. These fraud schemes involved false billing for physical and occupational therapy and DME. The defendants include the owners and operators, patient recruiters and employees at three different purported medical clinics and a medical equipment company, as well as three doctors. According to court documents, six of the defendants charged are serial Medicare beneficiaries, who purported to seek medical treatment from numerous providers, causing the submission of multiple claims to Medicare for purported medical treatments.

In Detroit, 11 defendants were charged for their alleged roles in schemes to submit fraudulent claims to Medicare for home health services, nerve conduction tests and injection and infusion therapy sessions. The schemes involved a total alleged fraud of approximately $35 million and five different purported medical services companies.

Four defendants were also charged in Houston for their alleged roles in a $3 million scheme to submit fraudulent claims for DME.

In addition to making arrests around the country, law enforcement agents are executing search warrants in connection with ongoing health care fraud investigations.

"Today’s charges allege attempts by individuals to defraud the Medicare program of $251 million," said FBI Director Robert S. Mueller, III. "Countless Americans rely on Medicare for their well-being, and the FBI, working in conjunction with our federal agency partners, is resolute in its commitment to stop those who would illegally manipulate the system."

"Today’s arrests illustrate how health care fraud schemes can replicate virally and migrate rapidly across communities," said Daniel R. Levinson, Inspector General of HHS. "To combat this fraud, the government’s response must also be swift, agile, and organized – a HEAT initiative goal which is well illustrated by today’s Strike Force actions."

The Strike Force operations in Miami, Baton Rouge, Brooklyn, Detroit and Houston are part of the Health Care Fraud Prevention & 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. The HEAT task force, co-chaired by Acting Deputy Attorney General Gary G. Grindler and Deputy Secretary Bill Corr, is made up of top-level law enforcement agents, prosecutors and staff from both departments and their operating divisions. In the May 2009 announcement, Attorney General Holder and Secretary Sebelius announced the expansion of the Strike Force into Detroit and Houston to build upon existing partnerships between the agencies in a heightened effort to reduce fraud and recover taxpayer dollars. In December 2009, Strike Force operations were expanded to Brooklyn, Baton Rouge and Tampa.

Since its inception in March 2007 with Phase One in South Florida and continuing through its most recent expansion into Tampa, Fla., the Strike Force has obtained indictments of more than 810 individuals and organizations that collectively have billed the Medicare program for more than $1.85 billion. In addition, HHS’s 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.

The cases announced today are being prosecuted and investigated by Strike Force teams comprised of attorneys from the Fraud Section in the Justice Department’s Criminal Division and from the U.S. Attorneys’ Offices for the Southern District of Florida, the Eastern District of New York, the Middle District of Louisiana, the Eastern District of Michigan and the Southern District of Texas; and agents from the FBI and HHS-OIG.

The Railroad Retirement Board Office of Inspector General and the Office of Personnel Management-Office of Inspector General also participated in today’s operation.

An indictment is merely an allegation, and defendants are presumed innocent until and unless proven guilty.

To learn more about the HEAT team, go to: www.stopmedicarefraud.gov.

May 11, 2010

Medicare Fraud Fugitive Taken into Custody at Miami International Airport and Ordered Held in Pre-Trial Detention Pending Trial (Criminal Division)

Washington - Jose Garcia, 55, who has been a fugitive since 2008, was taken into federal custody May 10, 2010, at Miami International Airport, announced the Departments of Justice and Health and Human Services (HHS). Garcia self-surrendered to FBI agents upon arrival in Miami.

Garcia appeared in federal court in Miami, where U.S. Magistrate Judge William C. Turnoff ordered him detained pending the resolution of the charges against him. Garcia and his co-defendant, Nayda Freire, were charged in 2008 with allegedly conspiring between April 2003 and November 2003 to submit approximately $10.9 million in false and fraudulent claims to the Medicare program for HIV infusion services allegedly provided at Global Med-Care Corp., an HIV infusion clinic operated by Garcia and Freire.

According to the indictment, Garcia, Freire and their co-conspirators allegedly retained and trained physicians and physicians’ assistants as part of the scheme at Global Med-Care to make it appear that legitimate HIV infusion and medical services were being provided. The indictment also alleges that Garcia and Freire laundered the proceeds of their crimes by sending the proceeds to sham management and marketing companies owned and controlled by their co-conspirators.

Garcia and Freire were charged with one count of conspiracy to defraud the United States, to cause the submission of false claims to the Medicare program and to pay health care kickbacks; one count of conspiracy to commit health care fraud; one count of conspiracy to launder the proceeds of their crimes; and four counts of money laundering. Garcia also was charged with four counts of submitting false claims to the Medicare program.

Freire pleaded guilty on Aug. 28, 2008, to one count of conspiracy to defraud the Medicare program, and was sentenced on Nov. 12, 2008, by U.S. District Court Judge Adalberto Jordan to 30 months in prison. In addition to the prison term, Judge Jordan sentenced Freire to two years of supervised release following her release from prison and ordered her to pay $7,992,391 in restitution to the Medicare program. In her plea, Freire acknowledged that between April 2003 and November 2003, she and others conspired to file $10.9 million in false claims to the Medicare program for HIV infusion services that were not provided and were not medically necessary. In addition, court documents explain how the patients were paid cash kickbacks in return for agreeing to allow Global Med-Care to bill Medicare for the unneeded services.

Freire admitted that after payments from Medicare were made into the bank accounts of Global Med-Care, she and others transferred approximately $6 million of the fraud proceeds to sham management, marketing and investment companies owned and operated by co-conspirators Carlos, Luis and Jose Benitez. Co-conspirators 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, these co-conspirators allegedly provided the money and staff necessary to open Global Med-Care; the Medicare patients whom the clinic would bill to the Medicare program; and transportation for the HIV patients who visited the clinic.  That indictment also alleges that Carlos and Luis Benitez were the true owners of Global Med-Care. 

The three Benitez brothers and McKenzie were charged with participating in the commission of approximately $109 million in HIV infusion fraud and money laundering through Global Med-Care and 10 other HIV infusion clinics. On Sept. 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 also admitted his role in a $119 million HIV infusion fraud scheme. McKenzie was sentenced by U.S. District Judge Alan S. Gold on Dec. 18, 2008, to 14 years in prison in connection with his role in the HIV-infusion Medicare fraud scheme.  In addition to the prison sentence, McKenzie was ordered to serve three years of supervised release following his prison term and pay $84 million in restitution to the Medicare program. The Benitez brothers remain fugitives.

The results were announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; John V. Gillies, 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 (OIG), Office of Investigations Miami office.

The case was prosecuted by Deputy Chief Hank Bond Walther and Trial Attorney N. Nathan Dimock of the Criminal Division’s Fraud Section, and investigated by the FBI and the HHS 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.

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 560 individuals who collectively have falsely billed the Medicare program for more than $1.2 billion.  In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.  

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

December 1, 2009

Maryland Man Admits Fraud on Hospital (U.S. Attorney for the District of Columbia)

WASHINGTON - Ademola Adeptu, 24, of Springdale, Maryland, pleaded guilty to one count of health care fraud on Dec. 2, 2009 in the U.S. District Court for the District of Columbia, announced Acting U.S. Attorney Channing D. Phillips, Special Agent in Charge Jeffrey W. Irvine of the United States Secret Service, Washington Field Office, and Chief Cathy Lanier of the Washington, D.C. Metropolitan Police Department. Adeptu is scheduled to be sentenced by the Honorable Paul L. Friedman on February 10, 2010, and could face up to 10 years in prison, although a sentence of less than sixteen months incarceration is likely under applicable sentencing guidelines.

According to the factual proffer agreed to by Adeptu, between August 2008 and April 2009, Adeptu worked in the finance department of the Children’s National Medical Center (hereinafter “Children’s”). During that time, Mr. Adeptu submitted six false invoices claiming payment due in the amount of $95,420 for medical services rendered to Children’s.

When the first three checks from Children’s could not be cashed because of the payee he had selected, Mr. Adeptu changed the payee on the false invoices to a corporate account to which he had access. Using this method, Mr. Adeptu was able to cash two checks from Children’s totaling $42,390. Among other items, Mr. Adeptu purchased a 2002 Land Rover, Freelander SE with the proceeds of his crime.

In announcing the guilty plea, Acting U.S. Attorney Phillips, Special Agent in Charge Irvine, and Chief Lanier praised the hard work of Secret Service Special Agent Kevin Rylach and Metropolitan Police Department Detective Richard Espinosa. They also acknowledged the efforts of Assistant U.S. Attorney Thomas E. Zeno, who is prosecuting this case, with the assistance of paralegal specialist Carolyn Cody.

For more information, visit the website of the United States Attorney's Office for the District of Columbia at: http://www.justice.gov/usao/dc/