HHS OIG Health Care Fraud Cases

November 29, 2011; U.S. Attorney; Southern District of Texas

Local Music Producer and Club Owner Convicted on Multiple Federal Charges 
HOUSTON - Julian Kimble, 46, has pleaded guilty to conspiracy to commit healthcare fraud, conspiracy to commit money laundering and tax evasion, United States Attorney Kenneth Magidson announced today. Kimble is the owner of Pearl Records and Pearl Entertainment and investor in Grooves Restaurant & Lounge.

November 29, 2011; U.S. Department of Justice

Patient Recruiter Pleads Guilty in Connection with $5.4 Million Medicare Fraud Scheme in Detroit 
WASHINGTON - A patient recruiter pleaded guilty today for his participation in a Medicare fraud scheme operated out of three Detroit-area health care clinics, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

November 29, 2011; U.S. Department of Justice

Owner of Houston Health Care Company Pleads Guilty to Defrauding Medicare 
WASHINGTON - The owner of a Houston health care company pleaded guilty today in connection with a Medicare fraud scheme involving durable medical equipment (DME), announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

November 28, 2011; U.S. Attorney; Eastern District of Michigan

Southfield Family Practice Doctor, Dr. Gwendolyn Washington, Sentenced To 120 Months For Public Corruption, Illegal Prescription Drug Trafficking And Health Care Fraud 
Dr. Gwendolyn Washington, M.D., age 67, was sentenced today to 120 months imprisonment for public corruption, health care fraud, and conspiring to illegally distribute prescription drugs, United States Attorney Barbara L. McQuade announced. McQuade was joined in the announcement by Andrew G. Arena, Special Agent in Charge, Federal Bureau of Investigation, Detroit Field Division and Lamont Pugh, III, Special Agent in Charge, Department of Health and Human Services, Office of Inspector General. Dr. Washington was sentenced by the Honorable Paul D. Borman.

November 22, 2011; U.S. Department of Justice

Detroit-Area Foot Doctor Pleads Guilty to Medicare Fraud Scheme 
WASHINGTON - A Detroit-area foot doctor pleaded guilty today for his participation in a Medicare fraud scheme, announced the Department of Justice, FBI and the Department of Health and Human Services (HHS).

November 22, 2011; U.S. Department of Justice

U.S. Pharmaceutical Company Merck Sharp & Dohme to Pay Nearly One Billion Dollars Over Promotion of Vioxx® 
WASHINGTON - American pharmaceutical company Merck, Sharp & Dohme has agreed to pay $950 million to resolve criminal charges and civil claims related to its promotion and marketing of the painkiller Vioxx® (rofecoxib), the Justice Department announced today. Under the terms of the resolution, Merck will plead guilty to a one-count information charging a single violation of the Food Drug and Cosmetic Act (FDCA) for introducing a misbranded drug, Vioxx�, into interstate commerce. Under the terms of its plea agreement with the United States, Merck will plead guilty to a misdemeanor for its illegal promotional activity and will pay a $321,636,000 criminal fine.

November 22, 2011; U.S. Department of Justice

United States Files Complaint Against BestCare Laboratory Services Alleging False Claims for Medicare Funds 
WASHINGTON - The United States filed a complaint against BestCare Laboratories, Inc. and its founder and principal, Karim A. Maghareh, in the U.S. District Court for the Southern District of Texas, the Justice Department announced today. The suit alleges that the defendants knowingly misrepresented the distances traveled by its lab technicians to artificially increase reimbursement from Medicare for mileage-based technician travel allowance fees.

November 21, 2011; U.S. Attorney; Southern District of Florida

Miami Man Sentenced For Stealing Identity Information From DCF Computers For Use In Medicare Fraud Scam 
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Henry Gutierrez, Postal Inspector in Charge, United States Postal Inspection Service, Miami Division, Vance Luce, Acting Special Agent in Charge, U.S. Secret Service, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and James K. Loftus, Director, Miami-Dade Police Department, announced today's sentencing of Yenky Sanchez, 25, of Miami, for conspiring to commit health care fraud, in violation of Title 18, United States Code, Section 1349; conspiring to commit authentication feature fraud, in violation of Title 18, United States Code, Sections 1028(a)(3) and (f); and aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1). U.S. District Judge Cecilia M. Altonaga sentenced Sanchez to 65 months in prison, followed by three years of supervised release. Judge Altonaga also imposed a $5,000.00 fine.

November 21, 2011; U.S. Attorney; District of New Jersey

Former Maxim Healthcare Services Senior Manager Sentenced to Prison for Health Care Fraud 
TRENTON, N.J. - A former senior manager and 13-year employee of Maxim Healthcare Services, Inc. ("Maxim"), was sentenced today to five months in prison and five months of home confinement with electronic monitoring for his involvement in the unlicensed operation of Maxim office that billed nearly a million dollars to government health care programs, J. Gilmore Childers, First Assistant U.S. Attorney announced.

November 17, 2011; U.S. Attorney; District of Rhode Island

Nationwide Supplier of Medical Equipment Pleads Guilty to Health Care Fraud, Money Laundering & Selling Adulterated and Misbranded Medical Devices 
PROVIDENCE, R.I. - The owner of Planned Eldercare, a nationwide supplier of durable medical equipment located in Buffalo Grove, Ill., pled guilty today in U.S. District Court in Providence, R.I., to defrauding the Medicare program by targeting arthritic and/or diabetic Medicare beneficiaries, and ensuring that his company ordered and shipped medical equipment and supplies to Medicare beneficiaries that they did not order and/or were not medically necessary.

November 17, 2011; U.S. Department of Justice

Houston Patient Recruiter Sentenced to 21 Months in Prison for Medicare Fraud Scheme Involving Claims of Hurricane Damage to Power Wheelchairs 
WASHINGTON - A patient recruiter for a Houston durable medical equipment (DME) company was sentenced today to 21 months in prison for her role in a health care fraud scheme involving power wheelchairs, announced the Department of Justice, FBI and the Department of Health and Human Services.

November 17, 2011; U.S. Attorney; Northern District of California

Three Bay Area Residents Charged With Oxycodone Trafficking 
SAN FRANCISCO - A federal grand jury in San Francisco returned an indictment in which three Bay Area residents are charged variously with conspiracy; possession with intent to distribute oxycodone and oxymorphone; distribution of oxycodone and oxymorphone; and possession of a firearm by a felon, United States Attorney Melinda Haag announced. The prosecution is the result of a seven month, multi-district investigation by the Federal Bureau of Investigation, Drug Enforcement Agency, and Health and Human Services.

November 17, 2011; U.S. Department of Justice

Fort Lauderdale, Fla.-Area Assisted Living Facility Manager Pleads Guilty to Fraud and Kickback Scheme 
WASHINGTON - The manager of a Fort Lauderdale, Fla.-area assisted living facility and owner of a purported community mental health center pleaded guilty yesterday for his role in a Medicare fraud kickback scheme that funneled patients through a fraudulent mental health company, American Therapeutic Corporation (ATC), announced the Department of Justice, FBI and Department of Health and Human Services.

November 16, 2011; U.S. Attorney; District of New Jersey

Top New Jersey Prescriber of Drugs to Medicaid Patients Sentenced to 43 Months in Prison for Fraud Scheme Involving Fake Physicians 
NEWARK, N.J. - A doctor with a practice in Elizabeth, N.J., was sentenced today to 43 months in prison for operating a health care fraud scheme in which patients were exposed to treatment during 20,000 patient visits from individuals who made as little as $10 an hour to pose as licensed physicians, U.S. Attorney Paul J. Fishman announced.

November 16, 2011; U.S. Attorney; Southern District of Texas

Houston Man Arrested for Health Care Fraud 
HOUSTON - Endurance Iyamu, 47, of Houston, has been indicted and arrested for devising and executing a scheme to commit health care fraud, United States Attorney Kenneth Magidson announced today. Iyamu will appear for his arraignment and detention hearing on Friday, Nov. 18.

November 16, 2011; U.S. Attorney; Southern District of Texas

Arrested in Florida, Couple to Appear in Houston on Charges of Bankruptcy Fraud 
HOUSTON - Husband and wife Michael Giventer and Julia Shvabskaya have been arrested for devising and executing a scheme to commit bankruptcy fraud and defrauding several creditors in Texas and elsewhere, U.S. Attorney Kenneth Magidson announced today. Giventer and Shvabskaya orchestrated the formation of multiple business entities allegedly dedicated to providing healthcare services.

November 15, 2011; U.S. Attorney; Northern District of Texas

Owner And Associates Of Euless Healthcare Corporation Arrested On Conspiracy And Health Care Fraud Charges 
DALLAS - Three defendants who have been charged in a federal indictment, unsealed today, with various offenses related to their involvement in the operation of Euless Healthcare Corporation, were arrested this morning by special agents with the FBI and the U.S. Department of Health and Human Services - Office of the Inspector General, announced U.S. Attorney Sarah R. Salda�a of the Northern District of Texas.

November 15, 2011; U.S. Attorney; Western District of North Carolina

Monroe Physician To Pay $950,000 To Settle Government Civil Fraud Allegations 
Millicent Francis-Lane, M.D. has agreed to pay $950,000 to the North Carolina Medicaid Program to resolve False Claims Act allegations, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina and North Carolina Attorney General Roy Cooper. Dr. Francis-Lane owns Union County Women's Care, which has offices in Monroe, N.C.

CMS Public Solicitation for Coverage with Evidence Development

Date:

11/07/2011

Public Comment Period:

11/07/2011 - 01/06/2012   

CED Public Solicitation

CMS is committed to improving health outcomes for its beneficiaries. However, many new technologies are developed with insufficient attention to addressing the needs of the Medicare beneficiary population.  Though the scientific evidence may be promising, it may not be sufficient to support broad coverage.  Conversely, a non-coverage decision could limit further evidence development, thereby making it more challenging to conduct studies that could better define the patient population that might benefit from an item or service.

CMS has a mechanism, known as coverage with evidence development (CED), through which we provide conditional payment for items and services while generating clinical data to demonstrate their impact on health outcomes.  

In concept, CED has the potential to accelerate Medicare beneficiaries’ access to innovative items and services and use evidence to identify the setting(s) in which a patient population is more likely to see the greatest benefit from an item or service.  While CED has produced some gains in innovation, our experience over the last few years indicates we still have room to improve the CED process.  The goal is to improve health outcomes for Medicare beneficiaries.  CMS believes that public input should inform this effort and is inviting your comments concerning CED.

We ask that you comment on the following areas:

• Implementation of CED through the national coverage determination (NCD) or other avenues under Part A and Part B;
• Potential impact of CED on the Medicare program and its beneficiaries.
• Suggested approach to CED to maximize benefit to Medicare beneficiaries

We will weigh public input on CED with our internal lessons learned to develop a guidance document that better aligns CED with the rapidly evolving changes in our healthcare system.  Our intended outcome is to mature CED so that it fulfills its potential as a mechanism that simultaneously reduces barriers for innovation and enables CMS to make better informed decisions that improve health outcomes for Medicare beneficiaries. 

We are removing the current CED guidance document with this request for comments.  We will collect comments on CED through January 6, 2012.  CED continues to remain in place during this review.

Instructions on submitting public comments can be found at http://www.cms.hhs.gov/InfoExchange/02_publiccomments.asp.

You may submit a public comment by clicking on the highlighted word COMMENT at the top of this page. We strongly urge that all public comments be submitted through this website. Please do not submit personal health information in public comments. Comments with personal health information may not be posted to the website.

Sisters sentenced in $6 million Medicare fraud in Dearborn

Two sisters, Caridad and Clara Guilarte, opened a clinic in Dearborn that purported to offer infusion therapy to people from the AIDS virus — just like the suspicious clinics all over Miami-Dade. They were sentenced to 14 years in prison for defrauding Medicare of more than $6 million. / Office of Inspector General

MIAMI — When Medicare started paying attention to the spike in costly HIV therapy claims in South Florida, a group of criminal entrepreneurs headed north to the Detroit area to exploit new territory, authorities say. Leading the first wave in 2005 were two sisters, Caridad and Clara Guilarte, who opened a clinic in Dearborn, Mich., that purported to offer infusion therapy to people from the AIDS virus — just like the suspicious clinics all over Miami-Dade.

“They were trailblazers of the worst kind,” Justice Department trial attorney Benjamin Singer said at the sisters’ sentencings today in U.S. District Court in Miami. “They opened a new strain (of Medicare fraud) in Detroit.” The judge agreed, sentencing the sisters, who came to the United States from Cuba in the early 1980s, to 14 years in prison for defrauding Medicare of more than $6 million.

U.S. District Judge Cecilia Altonaga gave the Guilarte sisters — who fled to Latin America in 2007 when they learned they were under federal investigation — five more years in prison than prosecutors and defense attorneys had agreed on in their plea agreements on convictions for health-care-fraud and money-laundering conspiracies.

The judge said her initial intentions were to sentence the sisters to maximum prison terms — 30 years — but she was “tempered” by the disparity with lower sentences already imposed on other defendants in the Caridads’ case and related Detroit investigations.

The Guilarte sisters, who were indicted in Detroit in 2009, asked to have their case transferred to their hometown in Miami after they fled to Venezuela and were arrested in Colombia this year.

“We are tired of seeing the brazen, callous manner with which countless people defraud our Medicare system,” Altonaga said.. “We must stop the epidemic. ... Both of you took what you learned in South Florida and exported it to Michigan.”

Altonaga reminded Caridad, 54, and Clara, 57, that the United States welcomed both with “open arms” from communist Cuba and that they returned the privilege by stealing millions from the U.S. government’s health-care program for the elderly and disabled.

The Justice Department said the sisters — Caridad is a legal permanent resident, Clara a naturalized U.S. citizen —pocketed $3.8 million from their HIV-therapy scam in Detroit, but none of that money has been recovered. Both sisters apologized to the judge and the U.S. government, saying they “must pay” for their theft. But the judge didn’t buy it, saying at one point to Clara: “Even though you say you must pay, I have every conviction you will not pay.”

The Guilarte sisters were among 53 suspects charged with Medicare fraud in the Detroit area in June 2009, the first cases brought by a Justice Department strike force that opened in that city after the Medicare corruption crisis in Miami-Dade.

The takedown was such a big deal that U.S. Attorney General Eric Holder held a news conference in Washington to spotlight the spread of Medicare fraud.

“In fact, 10 of the defendants named in the indictments ... are alleged to have brought their fraud schemes from Miami to Detroit,” Holder said. “After we arrested criminals in Miami, their cohorts simply moved their schemes to Detroit.”

According to an indictment and other court records, the Guilarte sisters incorporated Dearborn Medical Rehabilitation Center in November 2005. The sisters joined with other indicted Miami collaborators: Daisy Martinez, Jose Rosario, Martin Tasis and Joaquin Tasis. “The four had previously been partners in fraudulent infusion therapy clinics in Miami,” Singer, the prosecutor, wrote in court papers. The sisters told Martinez, who would ultimately cooperate with authorities as part of a plea deal, that Medicare was “paying well” for HIV infusion therapy in Michigan.

But when Martinez and the three others traveled from Miami to Detroit to meet the sisters, the Guilartes said they had a problem: obtaining patients with valuable Medicare cards.

Collectively, the partners expanded the business, hired local recruiters and paid off inner-city Detroit black men with Medicare cards who were eligible for expensive HIV services.

The patients did not need the infusion drugs, nor did they receive them in most instances, prosecutors said. Moreover, the infusion therapy taken intravenously had been obsolete for more than a decade, replaced by stronger antiretroviral drugs. Nonetheless, Medicare, known for its lax scrutiny of bills, continued to pay out hundreds of millions of dollars for the obsolete HIV therapy over the past decade.

The Guilartes and their co-conspirators submitted $9.1 million in Medicare claims for purported HIV therapy and collected about $6.1 million from the federal program through 2007. Singer said in court papers that the Guilartes’ Dearborn clinic “spread like a veritable contagion” in the Detroit area, where other offenders opened clinics, tapping into the city’s poor and sick population of Medicare beneficiaries.

Hundreds of clinic owners, operators, recruiters, doctors and beneficiaries joined the Detroit Medicare racket, submitting millions of dollars in false claims “above and beyond (the Guilartes’) haul,” Singer wrote. “Every one of those clinics had at its origin (in the sisters’) scheme,” he wrote.

The Justice Department has charged about 140 people — many from Miami — with Medicare fraud in Detroit. So far, about two-thirds of them, including the Guilartes’ co-conspirators, have been convicted.

Detroit-Area Man Arrested in Connection with $30 Million Medicare Home Health Scheme 

U.S. Department of JusticeNovember 03, 2011

Office of Public Affairs(202) 514-2007/TDD (202) 514-1888

WASHINGTON—A Detroit-area resident was charged and arrested today in the Eastern District of Michigan for his alleged leading role in a $30 million Medicare fraud scheme involving home health services, announced the Department of Justice, the Department of Health and Human Services (HHS), the FBI and the HHS-Office of Inspector General (OIG). In addition to the arrest, law enforcement agents executed search warrants at five locations, seizure warrants for 31 bank accounts related to the scheme and suspended Medicare payments to 16 health care companies associated with the scheme.

According to a criminal complaint unsealed today in U.S. District Court in Detroit, Zafar Mehmood, 45, allegedly masterminded a $30 million scheme involving the submission of fraudulent claims submitted to Medicare for services that were medically unnecessary and/or never provided through at least four home health agencies. The four home health agencies named in the complaint are Access Care Home Care Inc. and Patient Care Home Care Inc., in Ypsilanti, Mich., and Hands On Healing Home Care Inc. and All State Home Care Inc., in Detroit.

Mehmood is alleged to have paid kickbacks to patient recruiters and billed Medicare for services that were not medically necessary and/or not performed through Access, Patient Care, Hands On Healing and All State. Mehmood is also accused of laundering the proceeds of the scheme through sham companies and intermediaries.

Mehmood is scheduled to make his initial appearance today before U.S. Magistrate Judge Mona K. Majzoub.

Today’s charges were announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the HHS-OIG Office of Investigation. Including today’s charges, Medicare Fraud Strike Force operations in Detroit have charged a total of 139 individuals in cases involving approximately $174 million in fraudulent billings to Medicare.

The case is being prosecuted by Trial Attorney Gejaa T. Gobena and Catherine Dick of the Criminal Division’s Fraud Section. The investigations were conducted jointly by the FBI and HHS-OIG, as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Eastern District of Michigan and the Criminal Division’s Fraud Section.

Since their inception in March 2007, the strike force operations in nine districts have charged more than 1,140 individuals who collectively have falsely billed the Medicare program for more than $2.9 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

Criminal complaints contain merely charges and defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.