Health Care Fraud Blog

According to a Department of Justice press release, Miami-Dade County resident Dulce Briceño was sentenced on February 4th to 63 months in prison for her role in a $2.3 million Medicare fraud scheme.

Miami based U.S. District Judge Ursula Ungaro also ordered Briceño to pay $1.8 million in restitution. Originally, Briceño was indicted in the Eastern District of Michigan, but after her arrest in Miami, she consented to have her case transferred to the Southern District of Florida for her plea and sentencing.

Briceño pleaded guilty on Oct. 9, 2009, at which time she admitted that in approximately September 2006, she agreed with the owners of X-Press Center to manage the clinic on a day-to-day basis in exchange for a percentage of the profits the clinic generated. Briceño also admitted that during the time the clinic was open, the clinic routinely billed the Medicare program for services that were medically unnecessary or were never provided. Briceño admitted that she and her co-conspirators at the clinic had purchased only a small fraction of the medications that the clinic billed the Medicare program for providing.

Briceño admitted that Medicare beneficiaries were not referred to X-Press Center by their primary care physicians, or for any other legitimate medical purpose, but rather were recruited to come to the clinic through the payment of kickbacks. In exchange for those kickbacks, Briceño admitted that the Medicare beneficiaries would visit the clinic and sign documents indicating that they had received the services billed to Medicare. Kickbacks paid to Medicare beneficiaries at the clinic, according to plea documents, came in the form of cash and prescriptions for narcotic drugs.

Briceño also admitted that between approximately September 2006 and March 2007, she and her co-conspirators at X-Press Center caused the submission of approximately $2.3 million in false and fraudulent claims to the Medicare program for services purportedly provided at X-Press Center. Medicare paid approximately $1.8 million on those claims.

HOUSTON - Whether it is known as “courtroom rent” or by some other name, the dangers of going to trial as opposed to pleading guilty requires a careful consideration of the case, the facts, the sentencing guidelines and the judge.

Two Texas DME owners learned the very hard way yesterday at their sentencing following a trial. Rhonda Fleming was sentenced to 30 years in prison for her role in a DME scheme, she was the alleged owner of three DME companies and a billing company that submitted the claims, totaling $36 million. Her trial co-defendants, a co-owner of one DME and a “runner” (someone who supplied patient information for the others in the scheme) were sentenced to 11 years 3 months and seven and a half years in prison. Their co-defendants, who plead guilty before trial and testified at trial received 12 months, 60 months and 70 months in prison.

For more info, click: here.

Often, we hear that white collar crime is treated differently than other types of crime. However, it is often who commits white collar crime that brings about different treatment. I had a client indicted for fraud related to a DME. Monthly, he would send me articles about large DME companies paying large fines and false claims settlements for the same conduct he was alleged to have engaged in and asked the simple question, “Why am I supposed to go to jail and they don’t?”

People arrested for crimes, and in particular health care fraud can find many rationales for conduct that objectively looks bad; some form the bases for defenses; some are to try to feel better. One reaction is generally the same for nearly all, whether it is speeding or a million dollar fraud, “everyone is doing it.” A variation on that theme, and a fair one is that often individuals and small companies are treated much differently than much larger companies.

In 2004, at the same time Pfizer was negotiating a resolution of a $460 million settlement with the United States for unlawful “off label” uses of its drugs, it also was planning and executing marketing campaigns for other drugs doing precisely the same conduct. The results, a huge fine and restitution, but no criminal charges for individuals. An individual that takes a million dollars in a Medicare fraud scheme is going to jail; as are employees and others most closely associated with that person and the scheme. The world’s largest drug company agreed it participated in a $1 billion in Medicare fraud and pays money. The company, or likely a subsidiary, also plead guilty to a crime, but no person goes to jail. $2 billion is not a small sum, but many sitting in prison wonder why the rules are different.

Currently, the highest dollar “amount of loss” category for sentencing purposes involving fraud is for a loss figure of $400,000,000 or more, garnering a 30 level sentencing enhancement; whereas $1,000,000 or more will get a 16 level enhancement. If someone participated in a scheme with a resulting loss of $1million dollars, they are likely to go to prison for a minimum (without other adjustments) of 41 months. This sentence could be applicable to the person who masterminded the scheme as well as some low level employee who merely assisted. A person who participates in a scheme with a resulting loss of $1 billion would be subject to prison for a minimum of 188 months; however in this case, no one goes to jail. Clients complain, "the rich (corporate defendants) get richer, while the poor (individual defendant) gets prison."

Click here to read more.

Proposals to increase the criminal penalties for health care fraud are making their way into the Senate’s health care reform bill. The proposal, The Health Care Fraud Enforcement Act, involves significant increases in potential jail time through modifications of the Federal Sentencing Guidelines to increase sentencing levels predicated upon the “amount of loss” if the offenses involve health care fraud. Also, the proposal would lessen the proof requirements in kickback cases to no longer require willful conduct for a conviction. The proposal, S.B. 1959, by Senator Kaufman is co-sponsored by other fairly powerful Senators including Schumer, Specter and Leahy.

To lear more, click here.

Eight Miami-Dade County residents have been charged in a 16-count indictment for their alleged roles in a Medicare fraud scheme involving fake HIV infusion treatments.

After the arrests, the Sept. 24, 2008, indictment was unsealed charging one count of health care fraud conspiracy against Juan A. Marrero, a/k/a Tony Marrero; Orlando Pascual Jr.; Belkis Marrero; Dr. David Rothman; Luz Borrego; Dr. Keith Russell; Eda Milanes; and Jorge L. Pacheco.

In addition to the conspiracy charge, Tony Marrero is charged with six counts of health care fraud, two counts of money-laundering conspiracy and four counts of money laundering. Pascual is also charged with six counts of health care fraud, two counts of money-laundering conspiracy and four counts of money laundering. Belkis Marrero is additionally charged with six counts of health care fraud, one count of money-laundering conspiracy and one count of money laundering. In addition to the conspiracy charge, Rothman and Borrego are each charged with four counts of health care fraud, and Milanes, Russell and Pacheco are each charged with two counts of health care fraud. The indictment also seeks forfeiture from all defendants.

According to the indictment, Tony Marrero, Pascual and Belkis Marrero controlled the day-to-day operations of two Miami medical clinics: Medcore Group LLC (Medcore) and M&P Group of South Florida Inc. (M&P). As medical assistants, Borrego (at Medcore), Pacheco (at M&P) and Milanes (at M&P) provided unneeded HIV infusion treatments to paid patients. The indictment charges that Pascual, Borrego and Milanes delivered cash payments to the patients. Furthermore, the indictment charges Rothman with ordering the unnecessary treatments at Medcore, and Russell with ordering the unnecessary treatments at M&P. Rothman and Russell allegedly conducted cursory examinations of the beneficiaries and signed the required documentation, including medical and billing records, to make it appear that the injection and infusion treatments billed by Medcore and M&P were medically necessary and provided, when, in fact, they were not.

Juan Marrero, Pascual, Belkis Marrero, Rothman and Borrego allegedly caused Medcore and M&P to submit fraudulent claims to Medicare for more than $5.3 million. The indictment alleges that the defendants laundered a portion of the proceeds to acquire the cash necessary to pay the patients.

In the event of conviction, the advisory sentencing guidelines sentence range will be determined by measuring the dollar amount of the loss suffered. It is anticipated that lawyers for the government will advocate that loss is equal to the intended loss - an amount equal to the dollar amount alleged in the indictment. However, we have been successful in persuading federal judges that an obscure provision of “Special Rules” in the calculation of loss under the Federal Sentencing Guidelines is instructive and resulted in a significant exclusion of “relevant conduct” claimed by the government and a Guideline range approximately half of that requested.

As reported earlier in this blog, (click here and here) one U.S. District Court Judge has declared that he didn’t care whether the government proved the “submitted” amount as “intended loss” when the law actually requires calculation of the “allowed amount” minus 20 percent.

Continue reading "MEDICARE FRAUD STRIKE FORCE INDICTS EIGHT MIAMI-DADE RESIDENTS FOR AIDS/HIV INFUSION FRAUD" »

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DALLAS, TX (August 27, 2008) - The federal government’s largest health fraud case involving online pharmacies was scheduled to conclude today with the sentencing of Ryokesh Johar Saran (Joe Saran) before US District Judge Jorge A. Solis in the Northern District of Texas. Saran as well and the 30 corporations he controlled were scheduled for sentencing. Sentencing for the corporate and individual defendants was indefinitely postponed due to the apparent heart attack Saran suffered en route to court.

Benson Weintraub, the nationally renown federal sentencing expert and a former full-time professor of law along with publisher of the Health Care Fraud Blog, Robert Malove, both of Fort Lauderdale have represented Saran and the corporate defendants for more than two-years and have been mounting a virtually unprecedented course of complex presentece litigation. The defense has challenged the criminalization of Group Purchasing Organizations (GPO), comparing it to “pharmaceutical arbitrage” according to recent defense pleadings.

Though the government’s theory of “intended loss” reflects a gross exaggeration of loss, artificially inflating the sentencing range called for by the advisory United States Sentencing Guidelines. The amount of restitution, $69,000, better reflects the relative severity of the offense behavior caused by Saran and 30 individual codefendants,

The case was launched by the US Attorney General’s office with much fanfare, but Saran, the lead defendant and virtually only one not yet sentenced, has challenged the methodology by which the government arrived at its loss calculations, particularly in view of the “actual loss” associated with the Mandatory Victim Restitution Act (MVRA).

Defense lawyers and US Attorneys are tracking the Saran case as a benchmark in health care fraud sentencing litigation based on the novel issues presented by his counsel. Similar theories of “loss” asserted by the DOJ Trial Attorneys from Washington were recently rejected by two federal judges in Miami before whom Weintraub and Malove recently prevailed at sentencing.

The defense issued subpoenas for agents of the FBI and FDA as part of it’s reaction to the prosecution’ failure to abide by its earlier commitment to turn over all Brady material in mitigation of punishment. The government moved to quash the subpoenas and that litigation, too, is still in progress. The defense preemptively filed a motion to enforce the government’s promise made one-year ago of an incremental turnover of Brady materials and the defendant’s statements. Parenthetically, Chad Meacham, lead counsel for the Dallas US Attorneys office, repudiated the discovery stipulation reached between the defense and his predecessor, Bill McMurrey, now a partner at the Dallas office of Bracewell and Giuliani.

The United States Circuit Court of Appeals for the Eleventh Circuit in Atlanta reversed one of my cases on July 31, 2008, and remanded it back to the district court for re-sentencing due to the sentencing judge's failure to specifically follow the dictates of 18 U.S.C. § 3553(c). While this particular case had to do with a conspiracy to import a large quantity of cocaine aboard a ship boarded by customs agents on the high seas, the appellate court's opinion has universal applicability to all federal sentencing matters and certainly must be paid careful attention by attorneys who represent healthcare fraud defendants at sentencing. To read the opinion click here.

MIAMI (July 11, 2008). Yesterday the Bureau of National Affairs first reported another case rejecting the government’s methodology of computing “loss” in health fraud cases under the federal sentencing guidelines in the Southern District of Florida.

BENSON WEINTRAUB, the nationally renown federal sentencing expert National sentencing expert, a former full-time professor of law, persuaded US District Judge Cecilia Altonaga to reduce the government’s overarching figure of $14 million down to less than $400,000. The sentence of 41 months was about half of what the government claimed should be applied under the sentencing guidelines.

This ruling adopted the legal rationale of Judge Adalberto Jordan reported earlier in this blog when he declared that he didn’t care whether the government proved the “submitted” amount as “intended loss” when the law actually requires calculation of the “allowed amount” minus 80 percent.

The defendant was a physician, Ana Caos, MD who, after a mistrial and retrial, was convicted of dual conspiracies to file false Medicare claims and receive kickbacks.

Weintraub also argued that before, during, and after trial/sentencing, the defendant suffered from significantly reduced mental capacity which materially impacted her cognitive and volitional functions to mitigate the extent of her mens rea.

The case is legally significant as setting precedential loss rulings for health care fraud.

Dr. Caos was also represented by trial attorney Robert Josefsberg.

BENSON WEINTRAUB, the nationally renown federal sentencing expert and ANTHONY C. VITALE of the Health Law Offices of Anthony C. Vitale, PA presented a novel issue in health care fraud during a 5-day sentencing proceeding against Rodolpho Ramirez, a DME operator sentenced by US District Judge Adalberto Jordan (S.D.Fl.) to 24-months imprisonment for making fraudulent claims to Medicare and paying kickbacks to a local physician.

Weintraub and Vitale were successful in persuading Judge Jordan to assume, without deciding the issue, that an obscure provision of “Special Rules” in the calculation of loss under the Federal Sentencing Guidelines is instructive and resulted in a significant exclusion of “relevant conduct” claimed by the government and a Guideline range approximately half of that requested by John Cunningam and Jay Darden, DOJ Trial Attorneys from the Fraud Section in Washington.

The case attracted considerable attention in the legal profession with both criminal defense lawyers and a Deputy Attorney General observing portions of the extraordinarily lengthy hearing characterized by expert medical testimony about medical necessity, Medicare billing procedures, and medical economics.

The prosecutors argued that for the past year, they consistently employed another loss methodology in 70-100 other cases in the Southern District of Florida, a hotbed of Medicare Fraud, and every Judge accepted it, to which Judge Jordan replied, “Did anyone raise the issue asserted by Mr. Weintraub?” to which the government responded “No.”

Continue reading "DEFENSE LAWYERS PREVAIL IN HEALTH CARE FRAUD CASE" »

On April 2, the same day that seven co-defendants were indicted (click here) for their roles in an $11 million Medicare fraud scheme involving HIV infusion clinics, Rita Campos Ramirez who had pleaded guilty in August 2007 to a $170 million conspiracy to commit health care fraud was sentenced to 10 years in prison. According to the U.S. Department of Justice and local federal prosecutors, the scheme represents the largest known individual case of Medicare fraud in the history of the program.

Continue reading "Miami Woman Sentenced to 10-years for Role in $170M Healthcare Fraud Consiracy" »

Professor Benson Weintraub, Esquire, a Ft. Lauderdale-based global health care attorney and counselor with an international practice and clientele, and a distinguished academic authority on the Federal sentencing of corporations and individuals, has been invited to present "Defense of a Criminal Healthcare Fraud Case" at Health Care Compliance Association's (HCCA) 12th Annual Compliance Institute to be held in New Orleans April 13-16, 2008.

Weintraub has served as a full-time Professor of Law. During his legal career, Porf. Weintraub has successfully represented complex white collar targets, corporations, business entities, executives, defendants, and witnesses as a tenacious, exclusively federal white collar criminal defense lawyer for more than 25 years.

Among his credits has defended more than 60 Physicians, Health Care Delivery Corporations & Organizations, DME Distributors, Internet Pharmacies, Pharmacists, Pharmaceutical Manufacturers, and public officials on hospital regulatory boards throughout the nation.

He also represented David Paul in the failed CenTrust Bank case as well as reputed drug lords, Willie Falcon and Salvador Magluta.

Weintraub recently represented Arne Soreide, a high profile telecom executive convicted after trial (by other counsel) in Fort Lauderdale of a $22m fraud, successfully convincing the U.S. Court of Appeals for the Eleventh Circuit in Atlanta that his 25 year sentence of imprisonment must be reversed, which the appellate court conceded was improper.

Weintraub was appointed by the first Chairman of the US Sentencing Commission to assist the fledgling agency in drafting its initial sentencing guidelines for organizations and individuals.

His extensive academic writing has been widely published or cited in Yale L.J., Harvard Law Review, Federal Sentencing Reporter, Stanford Journal of Law & Policy, Notre Dame Law Review, Federal Probation (US Courts), etc., and health care blogs.

Florida Board Certified Criminal Trial Lawyer Robert David Malove is Of Counsel to Benson Weintraub, LLC, upon whom a Masters Degree in Forensic Science, was conferred on Malove by the distinguished George Washington University in Washington DC. Malove received his JD from Pepperdine University School of Law. He has completed the Graduate Certificate Program in Healthcare Corporate Compliance at George Washington University and is Certified in Healthcare Compliance (CHC) by the Compliance Certification Board of HCCA. For more information visit www.healthcarefraudblog.com.

By
Benson Weintraub [Benson Weintraub is a sentencing lawyer is Of-Counsel to the Law Offices of Robert David Malove, P.A.,in Fort Lauderdale and former Visiting Professor of Law at Hofstra University. While in law school, he worked on the Hoffa litigation under the direction of civil rights lawyer, Leonard Boudin.]

The political implications of Lewis Libby’s commutation of sentence by President Bush continue to reverberate, but this case summons memories of the suspicious circumstances under which President Nixon commuted the sentence of former Teamsters President, James R. Hoffa, 1971.

Hoffa and Libby were both convicted of obstruction of justice, but Hoffa had already served part of his thirteen-year sentence. That was enough to encourage exposure of the links between organized crime, the old International Brotherhood of Teamsters [IBT], and the intersection of such ties with money and politics.

Similarly, Bush and Cheney also appeared to fear that Libby’s imminent incarceration would lead him to cooperate with the Special Prosecutor, perhaps engendering a political scandal making Watergate look like a misdemeanor.

Continue reading "Political Commutations: Scooter Libby, Jimmy Hoffa & Sentencing Disparity" »