Health Care Fraud Blog

WASHINGTON – A Detroit-area patient recruiter pleaded guilty today for his participation in a Medicare fraud scheme, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

Daron Elder, 28, of Southfield, Mich., pleaded guilty in the Eastern District of Michigan to one count of conspiracy to commit health care fraud. At sentencing, he faces a maximum penalty of 10 years in prison and a $250,000 fine. However, the advisory sentencing guidelines call for a term of imprisonment of 30-37 months, restitution in the amount of almost $3 million, plus a $1 million fine.

According to the plea documents, Elder was a patient recruiter for a medical clinic in the Detroit area, Blessed Medical Clinic. Elder paid indigent Medicare beneficiaries cash kickbacks to receive diagnostic tests that he knew were medically unnecessary. In return for the cash kickbacks, the Medicare beneficiaries allowed their identification to be used in the submission of fraudulent claims. The government will argue at sentencing that Elder’s conduct caused the submission of approximately $2.5 million dollars in fraudulent claims to Medicare.

Medicare Fraud Cases on The Rise

http://gooznews.com/?p=3453

By GoozNews

Federal prosecutors brought a record number of cases of health care fraud in fiscal 2011, a new report said, with Florida and its huge Medicare-dependent population remaining the epicenter of fraudulent claims.

The latest data, drawn from federal records by the Transactional Records Access Records database at Syracuse University, showed total prosecutions jumped 68.9 percent to 1,235 cases compared to 2010, a record increase.

The huge increase was fueled largely by a sharp jump in cases brought in Puerto Rico, where prosecutors charged 548 defendants with health care fraud last year, up from just 119 the previous year. Most of those were minor cases. But even without the Puerto Rican cases, fraud prosecutions nationwide were up sharply and reached the highest level since 2000.

Miami led the nation in activity, accounting for nearly one out of every nine health care fraud prosecutions, followed by Houston. Together, federal prosecutors in those two districts accounted for over one out of every five health care fraud prosecutions.

The Obama administration stepped up its enforcement activity in late 2009 with the creation of tasks forces in nine cities to root out Medicare and Medicaid fraud. “They’re really going after these cases very aggressively, and I think you’ll see prosecutions increase even more over the next few years,” said Louis Saccoccio, chief executive officer of the National Health Care Anti-Fraud Association, which was launched in 1985 by insurers to help root out both private and public sector fraud in the industry.

“The good news is there’s lots of prosecutions,” he said. “The bad news is there’s lots of prosecutions. The real question is what will CMS (the Center for Medicare and Medicare Services) do to prevent these frauds from taking place in the first place.”

A typical case concluded in Trenton last week when a federal judge sentenced a former senior manager of Columbia, Md.-based Maxim Health Care Services, one of the nation’s leading home health care providers, to five months in prison for setting up a phony office that billed Medicaid and the Veterans Administration nearly a million dollars. The criminal charges were part of a nationwide investigation of Maxim that led in September to an out-of-court settlement where the firm – to avoid a conviction that might have disqualified it from the programs – agreed to pay the government $150 million in criminal and civil penalties.

Experts and even defense attorneys say health care fraud, estimated to cost the government $70 billion a year, won’t be curbed until the government figures out how to short-circuit schemes through better monitoring of claims before they are paid and better screening of firms before they are allowed to sell services to the programs. Last June, CMS launched a data-mining program that will review Medicare claims before payment to identify individual providers that show huge spikes in activity. “CMS is on the right track,” Saccoccio said.

“They have to blow up the bill now, investigate later system,” agreed Andrew Ittleman, a white collar criminal defense attorney at Fuerst Ittleman in Miami. While he says that many cases involve companies in legitimate billing disputes with the government, he agreed “it’s not at all misguided given the size of the problem and the magnitude of the fraud.”

“The more sinister cases down here involve people who set up broom closets without an address and bill Medicare as long as they can before they high-tail it to Cuba or wherever in Latin America,” he said. “Magistrates aren’t even giving pre-trial release to some of these defendants because we don’t have an extradition treaty with Cuba.”

This story appeared first in The Fiscal Times.

DETROIT, MI (May 6, 2011) - Two owners of a Dearborn HIV-infusion clinic were convicted of conspiracy to commit health care fraud, conspiracy to pay health care kickbacks, health care fraud and conspiracy to commit money laundering. Leonio Alayone, the person who helped them launder their financial gains, was convicted of conspiracy to commit money laundering and money laundering.

According to the superseding indictment, the two owners and brothers, Martin and Joaquin Tasis, paid kickbacks to patients when the brothers used the patients' Medicare accounts to bill for services never performed. Evidence showed that the Dearborn Rehabilitation and Medical Center was specifically established for the purpose of defrauding Medicare. From 2005 to 2007, Medicare was billed $9.1 million by the clinic for medically unnecessary treatments or services that were never performed.

Initially, the clinic was located in South Florida. The brothers later moved the clinic to Michigan when law enforcement became suspicious of possible fraudulent practices. So far 12 individuals involved in the case have been convicted for their part in the fraud; two others are awaiting trial.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

If you or someone you know is a healthcare provider and in need of serious HIV infusion defense or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

As reported previously here, a central feature of the Obama administration’s health care reform has been the HEAT (Health Care Fraud Prevention and Enforcement Action Team) initiative is the use of Strike Force teams. Strike Forces are multi-agency units of Federal and State law enforcement personnel designed to identify, investigate, and prosecute Medicare fraud. Strike Forces are supported by a CMS data analysis team and CMS program experts.

Since May 2009, this Administration has expanded Strike Force cities from Miami and Los Angeles, when Strike Force teams were launched in Houston and Detroit in May 2009 and in Brooklyn, Baton Rouge, and Tampa in December 2009. (To read more, click: here).

Building on the momentum started last May, U.S. Department of Health and Human Services Deputy Secretary William Corr and U.S. Department of Justice Acting Deputy Attorney General Gary Grindler, testified earlier this month before the United States House of Representatives Subcommittee on Labor, Health and Human Services, Education, and Related Agencies Committee on Appropriations and stated that the entire $250 million increase in the President’s Budget advances the goals of the HEAT initiative.

Strike Force defendants are also more likely to receive prison sentences and longer terms of imprisonment than more traditional criminal health care fraud defendants. Since the Strike Force’s inception, over 94% of all Strike Force defendants were convicted and sentenced to terms of imprisonment compared to 64% of all criminal health care fraud defendants. The average prison term for Strike Force defendants was 45 months, which was about 10% longer than the overall national average for federal health care fraud defendants over this same period.

New Strike Force locations are chosen based on thorough analysis of Medicare claims data, which helps identify hot spots of unexplained high-billing levels in concentrated areas, and a review of the most effective allocation of investigative and prosecutorial resources. The cost associated with Strike Forces expansion resulting in 20 locations by end-of-year FY 2011 is an estimated $46 million.

MIAMI, FL (September 22, 2009) Today the Miami Herald reported that “A fugitive who claimed to be Mexican but was betrayed by his Cuban accent -- which led to his arrest in Spain -- was sentenced to eight years' imprisonment Monday in Miami federal court on U.S. Medicare fraud charges. For more: Click here

One study by CMS found that up to 70% of payments for some medical equipment should not have been due to a failure to document the medical necessity for the equipment provided under CMS guidelines. In 2008, the errors resulted in $2.8 billion. A representative of CMS indicated that the numbers were not actual fraud, but the error rates made fraud more likely. A new program is of regional bidding for DME suppliers is expected to begin in 2010.

To read more, click here.