The Healthcare Fraud Blog

The Department of Justice announced another guilty plea for one count of conspiracy to commit health care fraud related to the home health care industry.  This time Beverly Cooper, a registered nurse, pleaded guilty for her role in fabricating nursing visit forms connected to a $24 million home health care fraud conspiracy.

Ms. Cooper worked with home health care companies in the Detroit, Michigan area, including Reliance Home Care LLC, First Choice Home Health Care Services Inc. and Accessible Home Care Inc.  She routinely fabricated nursing visits notes and other documents to give the impression to Medicare that home health care services were provided.  These fabricated documents were the basis of and supported the fraudulent claims submitted to Medicare for reimbursement.  In fact, these home health care services were not medically necessary and/or not provided.  Ms. Cooper also signed the nursing visit forms for home visits made by other unlicensed individuals, giving the false impression that she actually provided the services.  Ms. Cooper understood that the fraudulent documents she created would be used to support the claims the home health care companies submitted to Medicare for services that were not medically necessary and/or not provided.

In addition to fabricating the nursing visit forms, Ms. Cooper and her co-conspirators participated in staged home health care visits during inspections from Medicare.  The co-conspirators posed as employees of the home health care services companies and treated fake patients to give the inspectors the impression that the companies were legitimate and the home health care services for which they billed Medicare were actually being provided.

Between 2006 and May 2012, Ms. Cooper’s conduct caused fraudulent claims to be submitted to Medicare.  The companies received approximately $5, 403, 703 from Medicare for Ms.Cooper’s participation in the scheme.

Cooper faces a maximum of ten years in prison and $250,000 fine at her sentencing scheduled for July 23, 2013.

In the previous post information was included on the indictment of Dr. Ben Harris Echols of Houston, Texas for committing health care fraud in the home health care arena.  On March 14, 2013, the Department of Justice announced the sentencing of Dr. Echols for this fraud.  Echols was sentenced to sixty-three months in prison and ordered to pay $2,918,830 in restitution for his part in a conspiracy with Family Healthcare Group Inc. and Houston Compassionate Care, two home health care providers, by falsifying plans of care for Medicare beneficiaries, including patients he did not treat, in order to receive home health care services for which the patients were not qualified and the services were not medically necessary.

After a four-day trial, a jury convicted Echols of one count of conspiracy to commit health care fraud and six counts of false statements relating to health care matters.  Evidence presented at the trial showed that Family Healthcare Group Inc. and Houston Compassionate Care fraudulently billed Medicare for its home health care services and were reimbursed approximately $17.3 million, of which $5.5 million is attributed to beneficiaries for whom Echols had signed a plan of care.

In just one week the Department of Justice (DOJ) announced three guilty pleas in three cases across the nation involving similar schemes of fraud in the home health care industry.  In each of the three cases the defendants were guilty of billing Medicare for home health care services that were not medically necessary or never provided.  Furthermore, all three cases involved the falsification of medical records in efforts to support the fraudulent claims submitted to Medicare for reimbursement.

The first case announced on the DOJ’s website December 13, 2012, a Houston, Texas federal jury convicted Dr. Ben Harris Echols of one count of conspiracy to commit health care fraud and six counts of false statements relating to health care matters.  Echols worked with the Family Healthcare Group, Inc. and Houston Compassionate Care to commit the fraud.  He signed plans of care which are required by Medicare in order to receive reimbursement for the provided home health care service. The plans of care he signed, however, were for patients who were not under his care and about whose health conditions he had no knowledge.  Echols signed the documents even if other doctors were listed as the patient’s attending physician.  During the trial, doctors in whose names the claims were submitted to Medicare testified that the patients did not need the services for which Medicare had been billed.  Additionally, two patients testified that they had never been treated by Echols, they had different primary care doctors and they did not need or want home health care. Nonetheless, Echols submitted fraudulent claims for services that were never provided to these patients.  Family Healthcare Group, Inc. and Houston Compassionate Care fraudulently billed Medicare for home health services and received approximately $17.3 million of which $5.5 million were for the patients for whom Echols signed a plan of care.

On December 18, 2012, the DOJ announced that in Detroit, Michigan, a physical therapist, Ankit Patel, pleaded guilty for his role in a $13.8 million home health care fraud scheme.  Since 2009, Patel received payments from Physicians Choice Home Health Care, LLC to falsify medical documentation.  Patel created evaluations, therapy revisit notes and other medical documentation to support physical therapy services for patients Patel never saw or treated.  Patel admitted he knew that the documents he falsified and the documents he signed would be used to support false claims submitted to Medicare for reimbursement.  Patel also falsified documents for home health care for First Care Home Health Care LLC, Quantum Home Care Inc. and Moonlite Home Care Inc., all Detroit area home health companies and owned by Patel’s alleged co-conspirators.

Between June 2009 and September 2011, Physicians Choice and Quantum received approximately $1,324,015 from Medicare for claims submitted for fraudulent physical therapy services based on the falsified files and notes created by Patel.  Ten of Patel’s co-conspirators have already pleaded guilty for their roles in this health care scheme and one has been sentenced.  Three co-conspirators are fugitives and five await their own trials.

And the resolution of the third home health care fraud case was announced on December 19, 2012.  The owners and operators of two Miami home health care agencies pleaded guilty for their participation in a $48 million home health care Medicare fraud scheme.  As with the first two cases discussed above, the defendants Rogelio Rodriguez and Raymond Aday conspired to bill Medicare for home health services that were never provided.  And the medical records of Medicare beneficiaries were falsified to make it appear the patients qualified for the home health care services when in fact they did not and furthermore, the patients never received the care for which Medicare was subsequently billed.

Rodriguez and Aday conspired with patient recruiters through payments of kickbacks and bribes in exchange for providing patients to Caring Nurse and Good Quality, two home health care agencies in the Detroit area, as well as prescriptions, plans of care and certifications of medical necessity for unnecessary home health therapy and services.  Rodriguez and Aday used these falsified documents to bill Medicare.  Additionally staff at the two home health agencies falsified the patients’ medical records to make it appear that the patients qualified for such services, when in fact they did not qualify and they did not receive the services for which Medicare was billed.

Between January 2006 and June 2011, Caring Nurse and Good Quality submitted approximately $48 million in fraudulent claims and Medicare reimbursed the two entities approximately $33 million.

Pfizer Inc. has agreed to pay $55 million plus interest to settle allegations that Wyeth LLC illegally promoted off-label uses for its drug Protonix.  Pfizer Inc. acquired Wyeth LLC in 2009 and is responsible for Wyeth’s prior misconduct.  The United States government alleged the between February 2000 and June 2001, Wyeth illegally promoted Protonix tablets for uses beyond the approved Food and Drug Administration’s (FDA) indication for the drug.  Under the Federal Food Drug and Cosmetic Act, drug manufacturers such as Wyeth and Pfizer obtain FDA approval for the indications of use(s) that a manufacturer intends to market a drug.  A prescription drug is considered misbranded when a manufacturer intentionally markets the drug for unapproved indications of use, more commonly referred to as off-label uses.  It is illegal for a manufacturer to introduce or cause the introduction of a misbranded drug into interstate commerce.

The FDA approved the Protonix tablets manufactured and sold by Wyeth for the short-term treatment of erosive esophagitis, a condition associated with gastro-esophageal reflux disease (GERD) that can only be diagnosed with an invasive endoscopy.  The United States government alleged that Wyeth illegally promoted Protonix for all forms of GERD which could be diagnosed without an endoscopy, well beyond its limited erosive esophagitis indication.  The  illegal promotion began even before Wyeth started promoting the drug, when the company submitted its marketing materials for FDA approval.  The FDA noted at the time that the materials were misleading as Wyeth stated Protonix was safe and effective in the treatment of patients with GERD and did not limit the drug’s use to only those patients with esophageal erosion.  The government alleged that Wyeth disregarded the FDA’s warnings about its expansive promotion and trained its sales force to illegally promote Protonix for all forms of GERD, well beyond its FDA indication.

Furthermore, the government alleged that Wyeth promoted Protonix as the “best PPI for nighttime heartburn.”  This superiority claim, which the government alleged was formulated at the highest levels of the company, was not supported by any clinical evidence.  Wyeth retained an outside market research firm to ensure that the company’s sales representatives delivered this incorrect superiority claim.

Wyeth also conducted numerous continuing medical education (CME) programs  to further its illegal promotion of Protonix for off-label uses.  Pharmaceutical companies, such as Wyeth, are allowed to provide financial support to independent providers such as universities or nonprofit organizations for CME programs.  But these companies are not allowed to use the CME programs for promotional events for off-label indications.  The United States government alleged that Wyeth spent millions of dollars to conduct CME programs to drive the off-label use of Protonix.  The government alleged that Wyeth’s “brand team” influenced every aspect of the CME programs such as selecting program topics, speakers and content.  The CME materials were produced in the same colors and appearance as Protonix’s marketing materials as a tactic Wyeth and its vendor called “branducation.”

On Thursday, December 6, 2012, Jose Carlos Morales co-owner of Pharmovisa, Inc., and PharmovisaMD Inc., plead guilty to to paying kickbacks and submitting fraudulent claims for pharmaceuticals to Medicare and Medicaid.  The Department of Justice, in its announcement, stated that Morales and his co-conspirators submitted false and fraudulent claims to the government agencies, which amounted to approximately $23,367,775.

Morales through Pharmovisa, Inc. operated two pharmacies and one pharmacy through PharmovisaMD Inc., all located in Miami, Florida.  Morales paid his co-conspirators kickbacks in exchange for Medicare and Medicaid beneficiaries’ information for residents at assisted living facilities located throughout Miami.  Additionally, Morales and his co-c0nspirators paid kickbacks to physicians for prescription referrals, which Morales’ pharmacies billed to Medicare.

In addition to the kickback schemes Morales, since 2007, operated a double billing of Medicare and Medicaid for unused pharmaceuticals.  The drivers working for Morales’s three pharmacies routinely delivered pharmaceuticals to assisted living facilities located throughout federal Southern District of Florida.  The “pharmaceuticals” were packaged as “bingo cards,” which allowed the medications to be popped out of the packaging.  Following Morales’s instructions, these drivers picked up any unused “bingo cards” in order for Morales’s pharmacy personnel to repackage the medications into pill bottles.  The pharmacies would eventually re-bill Medicare and Medicaid.  A majority of the previously submitted claims for the “bingo cards” were never reversed.  Furthermore, Morales’s pharmacy staff — following his instructions — placed unused and partially used medications into bottles that were sold directly to the general public from the “community” pharmacy shelves.

In order to facilitate and conceal the fraud schemes, Morales and his co-conspirators also engaged in sham financial transactions that aided in concealing the flow of the fraudulent proceeds resulting from these schemes.  The sham transactions involved shell entities owned and/or controlled by Morales and his co-conspirators.

On Monday, December 10, 2012, the Department of Justice announced that Dr. Boris Sachakov, a board certified colorectal surgeon of Brooklyn, New York, was sentenced to thirty months in prison for his role in a fraud scheme to bill Medicare and more than ten private insurance companies for surgeries and other complex medical procedures that were never performed.

During a two week trial in June, 2012, evidence showed that from January 2008 to January 2012, Dr. Sachakov, owner and operator of the Colon and Rectal Care of New York PC, clinic fraudulently billed Medicare and the private insurance companies for surgeries and medical services he never provided to his patients.  After receiving complaints from patients that Sachakov never performed the surgeries, including hemorrhoidectomies for which he submitted billing, several of the private insurance companies began an investigation into Sachakov activities.  Trial evidence showed that the records in patients’ files created and maintained by Sachakov did not support the extensive billing claims he submitted to the private insurance companies and Medicare.  Further evidence showed that upon being confronted by several of the insurance companies about his billing practices, Sachakov wrote letters to patients asking them to falsely certify in writing that they had undergone the fraudulent surgeries.  During this time period Sachakov submitted or caused to be submitted false claims for such procedures to Medicare and the private insurance companies totaling more than $22.6 million and he received more than $9 million in reimbursements on those claims.

The Department of Justice announced on Monday, December 10, 2012, that Dr. Ho Yon Kim of Flushing, New York, pleaded guilty for his role in a scheme that resulted in more than $11.7 million fraudulent claims submitted to Medicare.

Dr. Kim was the president of URI Medical Service PC and Sarang Medical PC, two medical clinics located in Flushing, New York.  The clinics were supposed to provide physical therapy services and electric stimulation treatment.  Dr. Kim admitted that, between March 2007 to October 2011, he conspired with others to provide kickbacks to Medicare beneficiaries to allow the medical clinics to use their Medicare numbers to submit claims for medical services that were never provided or were medically unnecessary.  In exchange for the use of their Medicare numbers, Dr. Kim and his co-conspirators provided the Medicare beneficiaries with a variety of spa services, including massages, facials, lunches and dancing classes.

Dr. Kim faces a maximum of ten years in prison.  Two co-conspirators, Dr. Hoi Yat Kim and Dr. Peter Lu still await their trials for this particular scheme.

Two former patient recruiters for the Miami base mental health clinic Biscayne Milieu Health Care Inc., were sentenced November 16, 2012, for their roles in a Medicare fraud billing scheme that involved the submission of more than $50 million in fraudulent billings to Medicare.

The patient recruiters, Anthony Roberts and Derek Alexander, both of Miami, participated in the Medicare billing scheme with the owners of Biscayne Milieu Health Care Inc. and twenty-five other individuals including doctors, clinic managers, therapists, patient brokers and other employees.  Biscayne Milieu Health Care Inc. (Biscayne Milieu) is a Florida corporation headquartered in Miami that purported to provide a partial hospitalization program (PHP). A PHP provides intensive treatment services for patients suffering from severe mental illness.

The co-conspirators submitted the fraudulent Medicare billing in connection with the operation of Biscayne Milieu.  The co-conspirators paid the patient recruiters, among them Roberts and Alexander, to refer ineligible Medicare beneficiaries to Biscayne Milieu for PHP services that were never provided.  Many of the patients admitted to Biscayne Milieu were not eligible because they did not meet the medical qualifications such as chronic substance abuse, suffering from severe Alzheimer’s disease or dementia or had no mental health diagnosis but instead were seeking the fraudulent treatment in order to gain exemption from certain requirements for application of United States citizenship.

Anthony Roberts was sentenced to serve eighty-seven months in prison and ordered to pay $887,085 in restitution. Derek Alexander was sentenced to serve forty-two months in prison and ordered t pay $300,876 in restitution.

On Friday October 26, 2012, a physician, a home health agency owner and a patient recruiter were convicted for their participation in a $14. 5 million Medicare fraud scheme.  Sixteen other co-conspirators have previously plead guilty for their involvement in the scheme. The three current defendants and their co-conspirators caused the submission of false and fraudulent claims to Medicare for skilled nursing and physical therapy services for Medicare beneficiaries that in fact where never provided and/or medically unnecessary.

The scheme involved two home health care companies, Patient Choice and All American located in Oak Park, Michigan.  The co-conspirators used patient recruiters to get Medicare beneficiaries to sign blank documents for physical therapy.  These “patients” were paid in cash for their signatures on the blank documents.  Next, the owners of Patient Choice and All American paid physicians to sign referrals and other documents necessary to bill Medicare.  Contracted physical therapists and physical therapist assistants would create fake medical records using the pre-signed blank documents previously provided by the patient recruiters to make it appear that the physical therapy services had actually been provided, when in fact those services were never rendered.

Dr. Pramod Raval was found guilty of accepting kickbacks in exchange for referring patients to Patient Choice and All American home health care companies.  Dr. Raval referred patients from his own practice as well as patients recruited by the patient recruiters.

Chiradeep Gupta a physical therapist and part owner of All American was found guilty of providing the physical therapists and physical therapy assistants to Patient Choice and All American, who then created the false patient files from which the Medicare claims were submitted for services that were never provided and/or were medically unnecessary.  Gupta also directed the creation of these fake patient files.  Additionally, it was shown at trial that Gupta laundered the fraudulent Medicare reimbursements through multiple shell companies.

Richard Shannon, a patient recruiter was found guilty of recruiting patients and paying them cash for their signatures on the blank physical therapy forms, which were then used to create the fake patient files.

The Department of Justice announced on October 15, 2012, that Okechukwu Ofoegbu, administrator of CardioMax EMS, a Houston, Texas based ambulance company, pleaded guilty to the charges that he submitted approximately $1,734,550 in fraudulent claims for ambulance transport services to the Medicare program.

Medicare has very specific and narrow regulations under which ambulance transport services are covered. According to the plea agreement, from January 2011 through December 2011, Ofoegbu and others at CardioMax EMS transported patients that did not meet the Medicare regulations, falsified ambulance run sheets that describe a patient’s health condition and thus qualify the patient for transportation, and used such falsified run sheets to file claims with Medicare.  Ofoegbu admitted that he knew the claims were miscoded, the services were not medically necessary and, in some cases, not provided.

Ofoegbu was originally indicted in a nationwide sting on May 2, 2102, that resulted in 107 individuals being charged with Medicare fraud amounting to a total of $452 million. As part of Ofoegbu’s plea, he agreed to pay $553,002 in restitution to the United States.  On January 24, 2013, he faces a maximum of a ten year prison sentence.