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The many facets of crime . . .
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criminal fraud cases
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 Home Health Agencies (HHAs)

The owner and Chief Executive Officer of Georgia's largest home health agency, who pled guilty to charging Medicare and Medicaid for campaign contributions, ghost employees, and personal vacation trips, was sentenced to 33 months incarceration followed by three years supervised work release, during which time she is to perform 200 hours of community service. She was fined $25 million and ordered to pay $11.5 million in restitution. The company's former Vice President was sentenced to 151 months incarceration and three years probation, fined $75,000 and ordered to repay $710,100. He was convicted of making false statements about salaries for ghost employees and a related organization, converting workers' compensation premiums to his own use, using Medicare funds to support a consulting business, embezzling employee health insurance and benefit plan funds, committing bank fraud, and laundering money. In addition, the former agency risk manager was sentenced to 97 months incarceration and three years probation and ordered to repay $710,000 after being convicted of mail fraud and conspiracy to defraud the Medicare and Medicaid programs. The consulting business of which the risk manager had been president was sentenced to five years probation, fined $250,000 and ordered to pay restitution of $710,000. This case is an excellent example of a successful joint audit and investigative effort. 

The owner of two Pennsylvania HHAs was sentenced to two years probation, assessed $50, and ordered to perform 100 hours of community service. She submitted Medicare reimbursement claims for personal expenses, such as placing her husband and nanny on the company's payroll, and for non-Medicare expenses such as hotel stays, meals, flowers, and clothing. Due to her financial situation, she will not be prosecuted in civil court. However, on the basis of a Medicare carrier review, $300,000 was withheld and will be retained by the Medicare program.

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 Nursing Homes

A former nursing home owner and operator was sentenced in California for filing over 7,000 fraudulent Medicare claims. He was sentenced to 11 years and three months imprisonment and ordered to pay fines, restitution, and special assessments of more than $3.5 million. A joint audit and investigation revealed that the nursing home owner had billed Medicare for nonexistent medical supplies for his nursing home, and filed cost reports with false expenses. He attempted to conceal the scheme by submitting false cost reports to Medicare, supported by falsified medical records and fabricated invoices. Two of his employees and two former Medicare carrier employees who testified against him pled guilty and were sentenced prior to his trial.

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 Physicians

An Illinois physician was sentenced to 24 months in prison and ordered to pay a $25,000 fine and $41,460 in restitution for defrauding Medicare and private insurers.  Unable to recruit physicians and sufficient referrals for a multi-million dollar diagnostic clinic he had built, the physician billed every patient who visited the clinic $4,000 to $6,000 in unnecessary tests.  He entered false symptoms in the patients' records to justify the billings.  The case involved the difficult issue of proving lack of medical necessity.  The sentencing culminated a lengthy investigation and a five-month trial, the longest in the southern district of Illinois.

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 Pharmacists

In Pennsylvania, a pharmacist was sentenced to eight months imprisonment for defrauding Medicaid and Medicare.  The pharmacist routinely billed Medicaid for brand name drugs while supplying generic brands.   He also was a partner in a durable medical equipment (DME) company, which paid kickbacks to his brother for referrals.  The pharmacist was ordered to pay restitution and assessment of $167,200, and the holding company for his pharmacy had to pay a $600 assessment.  The company's owner and two employees were sentenced earlier for fabricating test results and forging physician signatures for equipment.  The pharmacist's brother is to be sentenced in November.


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  Durable Medical Equipment (DME) Companies

A New York jury returned a guilty verdict against two brothers for conspiracy related to fraudulent Medicare claims.   The two visited senior citizen high rises, and conducted health fairs where they coaxed beneficiaries into giving them their Medicare health insurance numbers.  The brothers furnished these numbers, along with forged certificates of medical necessity (CMNs), to two DME companies.  The companies then billed for equipment, much of which was never supplied, causing Medicare to pay more than $750,000.  The brothers were paid "commissions" depending on the cost of each piece of equipment.  The two had formerly worked for two other New York DME companies which were convicted and sentenced earlier as a result of Office of Inspector General investigations.

A DME company in Texas was sentenced to one year of probation for filing false Medicaid claims for services not rendered.  As part of the plea agreement the company was also ordered to pay restitution of $450,000.  The DME company supplied wheel chair pads to nursing home patients and then fraudulently billed Medicare under the code for a lumbar sacral support system, also known as a "body jacket."  Earlier, the former owner of the DME company pled guilty to mail fraud.

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 Medicaid

A North Dakota state social worker signed an agreement to repay $110,500 she had defrauded in false Medicaid claims in Minnesota and South Dakota from 1988 to 1992.  She also agreed to a five-year exclusion from Medicare and Medicaid.  The social worker billed for the services of a physician psychiatrist which were actually performed by social workers.  She conspired with a psychiatrist who signed the claims, although he performed no services, in exchange for a part of the reimbursements. The psychiatrist agreed to pay $80,000 for his part in the scheme.

In Tennessee, two men were sentenced to seven months incarceration, seven months home confinement, and two years supervised release for defrauding Medicaid.  The father of one of the men was sentenced to one day incarceration and 18 months supervised release.  The three submitted fraudulent crossover claims to Medicaid, including false expenses on cost reports and failure to report related parties.  Prior to this investigation, the father was incarcerated in a related case, involving his brother and several nursing homes.

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