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Criminal and Civil Enforcement

February 2004 Criminal Enforcement Report

Hospitals, Laboratories, and Clinics

In South Carolina, the remaining five physicians from a pain management center were sentenced for their roles in defrauding the Government. They were the last of ten individuals sentenced in a case that resulted in over 70 years total incarceration and ordered restitution totaling approximately $811,000. The doctors at the center prescribed controlled substances outside the usual course of medical practice and forced unnecessary tests on patients in order to submit fraudulent claims to Medicare and other health care plans. Narcotics were provided to patients after little or no physical exam, and doctors met with more than one patient at a time in an effort to increase the clinic's revenue.

Durable Medical Equipment

In South Carolina, an owner/operator of a DME company was sentenced to 5 months in prison and ordered to pay $88,000 in restitution for health care fraud. From February 1998 through 2002, the woman submitted claims for repairs to wheelchairs and mechanical hospital beds that were never performed.

Physicians and Other Health Care Professionals

In New York, a man was sentenced to 24 months incarceration and ordered to pay $398,000 in restitution for health care fraud. Although he possessed a valid license as a clinical psychologist in Massachusetts, the man did not meet the criteria for licensure in New York but purported to be licensed in the State. Based on the Massachusetts license, he was able to obtain Medicare and private provider numbers. The man used these numbers to submit claims to Medicare that were upcoded, not rendered, or for telephonic services. For his private pay patients, he submitted claims as if the patients were treated in Massachusetts.

Medicaid Fraud

In Virginia, two operators of a cab service were sentenced to 27 months and 21 months in prison, respectively, for submitting claims to Medicaid for taxi services they did not provide. They were also ordered to pay $395,000 in joint and several restitution.

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March 2004 Criminal Enforcement Report

Hospitals, Laboratories, and Clinics

In Arizona, two operators of a small community mental health clinic were sentenced for false statements relating to health care matters. They were each ordered to pay $40,000 in restitution. The investigation revealed that they used a matrix of keywords in order to systematically create false progress notes to pass the Medicare carrier's medical review. They also photocopied doctors' signatures on plans-of-care to keep patients in the partial hospitalization program for extended periods of time.

Transportation Fraud

In Georgia, two individuals and an ambulance company were sentenced related to charges of providing medically unnecessary ambulance runs and for using non-licensed personnel. One of the individuals was sentenced to 30 months in prison, and the other was sentenced to 21 months in prison. The company was ordered to pay a $650,000 fine. In addition, they were ordered to pay $959,000 in joint and several restitution.

Physicians and Other Health Care Professionals

In Pennsylvania, a chiropractor was sentenced to 18 months imprisonment and ordered to pay $10,000 in fines and restitution for mail fraud in connection with the death of a Medicaid patient. A world-renowned chiropractor, the woman admitted that she deprived patients of their intangible right to her honest services by acting outside the scope of her field in treating patients with conditions such as epilepsy and Down Syndrome. The chiropractor admitted that the death of a 32-year-old epileptic Medicaid patient in 1999 was the direct result of her actions when she convinced the woman that she could cure her of her epilepsy. She informed her patient that to be seizure free, she must be drug free. As such, she convinced the patient to stop taking her anti-convulsive medications. After discontinuing the medications, the patient began to experience violent grand mal seizures, some of which occurred in the chiropractor's presence, over the next several days. The chiropractor took no steps to seek proper medical treatment for her patient, despite the fact that she could no longer walk, was forced to wear adult diapers, was confined to a wheel chair, was severely dehydrated, had aspirated the contents of her stomach into her lungs and was unconscious. From April 26, 1999 through April 28, 1999, the patient was taken in this condition to see the chiropractor who characterized her condition as normal and that she was merely getting the drugs out of her system. The chiropractor specifically warned the patient's fiancÚ that if he took her to the hospital, she would be administered the anti-convulsive medications and she could die. The patient was pronounced dead in the early morning of April 29, 1999. The cause of death was complications from uncontrolled epilepsy.

Child Support Enforcement

In Virginia, a man was sentenced to 16 months imprisonment, 1 year supervised release and ordered to pay $62,000 in restitution for failure to pay child support. In order to avoid paying child support, the man used numerous aliases and social security numbers. When arrested, the man was using an alias but was correctly identified through a match of fingerprints on file with the FBI.

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April 2004 Criminal Enforcement Report

Misuse of Grant Funds

In Montana, a former university professor was sentenced to 5 months incarceration and ordered to pay $39,000 in restitution for embezzlement. While employed at a State university, the man received grant funds to coordinate a community campaign against teen drug, alcohol and tobacco use. Although the man failed to complete the project, he used the grant funds for his own personal use.

Durable Medical Equipment

In Florida, a durable medical equipment owner was ordered to pay $3,000 in restitution related to a scheme to defraud. The owner paid a printing and graphics company to print 20 prescription pads using the licensing and business information of a physician without his knowledge. In addition, the owner submitted 16 fraudulent claims to Medicare for custom fitted orthotic equipment purportedly prescribed by the physician.

Employee Misconduct

In New Mexico, a former Indian Health Service nurse was sentenced for unlawful possession of a controlled substance. An investigation revealed that the nurse removed numerous narcotic drugs from the hospital's emergency room without physician orders.

Physicians and Other Health Care Professionals

In New York, three subjects were sentenced for their roles in a scheme to defraud the Government and private insurers. A podiatrist was sentenced for submitting claims for services that were either upcoded, not rendered, or were medically unnecessary. Also sentenced were two billing clerks who at the direction of the office manager, submitted claims that they knew were fraudulent.

Child Support Enforcement

In Montana, a man was sentenced to 24 months in prison and ordered to pay $45,000 in restitution for failure to pay child support. The man used various dates of birth and Social Security numbers to avoid detection.

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May 2004 Criminal Enforcement Report

Misuse of Grant Funds

In South Carolina, a woman was ordered to pay $30,000 in restitution for embezzlement and theft. Working as the executive director of a rural health clinic which receives grant funds, the woman used a corporate credit card to make purchases for her own personal use. The fraudulent activity was discovered during an audit.

Physicians and Other Health Care Professionals

An Indiana doctor was sentenced to 7 years incarceration, with 3 years suspended, for his scheme involving intimidating Medicaid beneficiaries. The doctor, who was previously found guilty during a 4-day jury trial, intimidated Medicaid recipients by telling them they would lose their benefits if they did not make cash payments.

Child Support Enforcement

In Nevada, a man was fined $5,000 for failure to pay child support. In March 2004, the man pled guilty and paid $46,317, the amount of his arrearage. The man was the chief executive officer of a medical supply company in New York.

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June 2004 Criminal Enforcement Report

Durable Medical Equipment

In Texas, a man was sentenced to 13 months incarceration and ordered to pay $105,000 in restitution for health care fraud. Through his company, the man billed Medicare for power wheelchairs using a code that did not correspond to the wheelchair that was actually provided.

Physicians and Other Health Care Professionals

A Virginia physician was sentenced to 18 months incarceration and ordered to pay a $10,000 fine and $191,000 in restitution for health care fraud. From approximately January 2000 through October 2003, the physician submitted upcoded claims to Medicare and to a private insurer. In addition, claims submitted reflected comprehensive office visits that did not occur at all, or were for dates of service when the patient was only provided a prescription refill. The investigation began in July 2003 when the private insurer found that the physician's billings were much higher than the average medical provider in the area. Shortly after the investigation began, a fire occurred at the physician's medical office, which was determined to be a case of arson. Although a grand jury returned an indictment charging the physician with arson in connection with the fire, the Government dismissed the charge in exchange for his guilty plea to health care fraud.

Child Support Enforcement

In Maryland, a former U.S. professional basketball player was sentenced to 12 months and 1 day in prison, 12 months supervised release and ordered to pay $128,000 in restitution for failure to pay child support. The sentencing was the culmination of a 5-year Office of Inspector General (OIG) investigation during which the man was located in Spain and proof of his sizeable professional earnings in three foreign ball clubs was obtained through the OIG's first-ever use of a Mutual Legal Assistance Treaty, an international agreement to facilitate judicial assistance. Through this process, the U.S. State Department and Spain's Department of Justice were able to establish that the man had the ability to support a son during the same years in which he benefited from declaring the boy as a dependent on his income taxes.

In Louisiana, a man was sentenced to 2 years probation and ordered to pay a $2,500 fine for failure to pay child support. Prior to sentencing, he paid $64,750, representing 11 years of overdue arrearage, and also paid all future support payments due from the present through his daughter's age of majority. In 2002, the man was operating a successful business with a taxable annual income of $184,000. In 2003, he earned a greater amount and owned two high-end sport utility vehicles, while his ex-wife and daughter lived in Government subsidized housing.

Employee Misconduct

In New Mexico, an Indian Health Service (IHS) contract employee was sentenced to 3 years supervised release and ordered to pay $26,000 in restitution for embezzlement. The man, who was supervising a construction project for IHS, embezzled money in order to add an addition to his home.

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July 2004 Criminal Enforcement Report

Durable Medical Equipment

In Indiana, a woman was ordered to pay $460,000 in restitution for health care fraud. As a billing clerk at a DME supplier, the woman routinely billed Medicaid for more items than were actually provided. In addition, the woman's parents have entered guilty pleas for their involvement in the scheme and are scheduled to be sentenced in October 2004.

In Florida, a DME company owner was ordered to pay $54,000 in restitution for false claims. The woman billed Medicare for wheelchairs but actually provided patients with less expensive scooters.

Physicians and Other Health Care Professionals

An Illinois doctor and her employee were sentenced for their role in submitting false claims. The doctor was sentenced to 5 months incarceration and ordered to pay $70,000 in restitution; the employee was ordered to pay $7,500 in restitution. Claims submitted were for psychiatric services provided when the doctor was absent from the office and/or were actually provided by the employee, who has never been licensed to practice medicine.

Prescription Drug Fraud

In North Carolina, an operating room nurse was sentenced to a 5-month suspended sentence and ordered to pay $15,000 in restitution for her role in fraudulently obtaining controlled substances. The woman provided prescription pads to a group of drug dealers who would in turn obtain controlled substances and return a portion of the drugs to her to sustain her drug addiction.

In Washington, D.C., a man was sentenced to 270 days incarceration with credit for time served for obtaining controlled substances by fraud and for escaping from an institution. The man used the identities of two physicians to write prescriptions for controlled and non-controlled substances. Most of the prescriptions were written on stolen or fabricated prescription pads from a hospital. Also sentenced this month was a Government contractor for using his insurance to pay for some of the fraudulent prescriptions.

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August 2004 Criminal Enforcement Report

Hospitals, Laboratories, and Clinics

In Illinois, a laboratory owner was sentenced to 5 years incarceration and ordered to pay $2.5 million in restitution for his guilty plea to mail fraud. The laboratory company employed more than 50 employees and provided laboratory services to over 100 nursing homes. Through his company, the man billed Medicare and Medicaid for tests not performed and fraudulently claimed mileage to obtain lab specimens.

Physicians and Other Health Care Professionals

In Pennsylvania, pursuant to his guilty plea, a man was ordered to pay a $1,000 fine for false claims; he previously paid $20,000 in restitution. The man, who only held a Master's degree, billed Medicare for psychological procedures he provided that are reimbursable by Medicare only if performed by a PhD level psychologist. In order to bill for the services, the man billed Medicare utilizing another doctor's provider number and as agreed, paid the doctor 15 percent of the Medicare payment.

Employee Misconduct

In Maryland, a former Government employee was ordered to pay $7,000 in restitution and fines for misuse of her Government-issued IMPAC credit card. Formerly employed with National Disaster Medical Systems, which is now part of the Department of Homeland Security, the woman fraudulently used her IMPAC card to rent vehicles for her own personal use from various car rental centers from May 2003 to August 2003.

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September 2004 Criminal Enforcement Report

Prescription Drug Fraud

In Arkansas, a woman was sentenced to time served of 4 months and 3 days and ordered to pay $4,000 in restitution for her scheme to fraudulently obtain at least 72 prescriptions of narcotic drugs, totaling 9,615 pills. In addition, the woman was ordered to participate in a drug rehabilitation treatment program and to undergo routine drug testing. While employed as the director of nursing for several nursing homes, the woman used her position to obtain residents' Medicaid numbers to obtain prescriptions for narcotic drugs, including Hydrocodone. The woman called in prescriptions to pharmacies in the names of residents and included maintenance medications on the order in an attempt to mask the narcotic drug. She disposed of the maintenance medications when she picked up the prescription order. As a result of the scheme, many nursing home residents were denied prescriptions since records revealed that the prescriptions had been recently filled.

Physicians and Other Health Care Professionals

An Ohio doctor specializing in pain management, family practice, and emergency medicine was ordered to pay $215,000 in restitution for Medicaid fraud. In addition, $400,000 in cash previously seized was ordered to be forfeited to the Government. Investigation revealed that the doctor billed office visits using codes indicating an extended visit, when he actually only saw patients for a few minutes. He routinely saw over 60 patients in a day but worked less than 6 to 7 hours a day.

Child Support Enforcement

In Indiana, a man was sentenced to 3 years imprisonment, suspended, 3 years probation and ordered to pay his remaining arrearage of $13,000 for failure to pay child support. Investigation revealed that the man left Illinois and began living with his twin brother in Arizona. In Arizona, the man was working for a construction company owned by family members. After learning that the OIG and local authorities had uncovered his current whereabouts, the man returned to Indiana, paid $10,000 toward his arrearage, and pled guilty.

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October 2004 Criminal Enforcement Report

Prescription Drug Fraud

In Pennsylvania, a pharmacist was sentenced to 12 months home detention and ordered to pay $12,000 in criminal fines for her involvement in a fraud scheme. While working at a pharmacy, she illegally distributed Percocet and OxyContin from October 2001 through November 2002. The pharmacist's illegal activities were uncovered during an investigation of an employee of a family and substance abuse counseling center who was engaging in fraudulent billings to support a drug addiction. The employee of the counseling center was previously sentenced to 30 months incarceration and ordered to pay over $1 million in restitution.

Durable Medical Equipment

In Texas, a woman was sentenced to 46 months incarceration and ordered to pay $1.7 million for her guilty plea to health care fraud. Through her DME company, the woman fraudulently billed Medicare over $3 million worth of power wheelchairs and accessories from December 2002 to August 2003. Claims submitted to Medicare were either upcoded or were for equipment that was not provided at all. In addition, certificates of medical necessity used in the scheme were purchased from recruiters.

Medicaid Fraud

In Idaho, a woman was ordered to pay $129,000 in restitution for conspiracy to commit health care fraud. The woman owned and was a therapist at a counseling center. The woman and her co-conspirator submitted fraudulent claims to Medicaid for case management services they did not provide. In order to submit the fraudulent claims, Medicaid numbers were obtained from their friends, family, and neighbors.

In South Dakota, a woman was sentenced to 30 days incarceration and ordered to pay $48,000 for failing to disclose assets held by an individual for whom she had power of attorney. This individual resided in a nursing home and received Medicaid benefits to which she would not have otherwise been entitled. She had been placed in the nursing home in 1999 and began receiving Medicaid benefits in 2001 based on the false information.

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November 2004 Criminal Enforcement Report

Prescription Drug Fraud

In Rhode Island, a pharmacist was sentenced to 37 months in prison for charges related to selling prescription drug samples to customers at his pharmacy. In addition, the pharmacist was ordered to forfeit $431,000 to the Government and pay a $45,000 fine. Pharmaceutical representatives provided the drug samples to a physician who in turn diverted them to the pharmacy. In September 2004, the physician was sentenced to 10 years in prison for his involvement in this scheme and for administering diluted vaccines to immigrant patients.

Physicians and Other Health Care Professionals

In Ohio, a chiropractor was sentenced to 1-year incarceration and ordered to pay $79,000 in restitution for health care fraud. Regardless of the service he actually performed, the man billed all services as manipulative treatments since it is the only service for which Medicare authorizes reimbursement. In addition, the chiropractor provided medical excuses for patients to miss work in exchange for allowing him to bill services to their insurance carriers.

In Maine, a registered nurse was sentenced to 18 months in jail with all but 45 days suspended for theft of drugs. While working at a hospital emergency room, the woman stole morphine on at least three occasions.

Hospitals, Laboratories, and Clinics

In Texas, the owner of a clinic was sentenced to 12 months and 1 day in prison and ordered to pay $463,000 in restitution and fines. The man claimed employee bonuses totaling $500,000 on the clinic's 1997 cost report that were not paid to employees but were used by him for other purposes not related to the clinic.

Nursing Homes

In Louisiana, the former owner of a nursing home management company was sentenced to 37 months imprisonment for health care fraud and pension fraud. In addition, he was ordered to forfeit his $700,000 residence, a retirement estate valued at approximately $2.5 million, and numerous pieces of construction equipment. Through his company, the man, who owned three nursing homes, diverted Medicare and Medicaid money intended for the care of residents for his own personal use. Because these funds were diverted, facilities were inadequately staffed and residents were forced to do without proper personal care items and medications. In addition, the man claimed $2.3 million on cost reports for payments to vendors when, in fact, the funds were diverted for his own personal use; failed to timely deposit pension plan funds withheld from employees' paychecks; and as the administrator of the pension plan, made unauthorized loans to himself to pay debts of his construction company and retirement estate. The man's retirement estate contained five manmade ponds, a stone-lined manmade waterfall, and exotic swans. Though his nursing homes were inadequately staffed, he used nursing home monies to employ five to seven groundskeepers to properly care for his retirement estate. At one of the nursing home facilities, a nurse was forced to cut the knee-high grass.

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December 2004 Criminal Enforcement Report

Prescription Drug Fraud

In Ohio, a woman was sentenced to 14 months in jail for theft of drugs. The woman, who was previously employed as a registered nurse at a small hospital, used her position to obtain information on patients who had recently been discharged and were receiving pain medication. Without authorization and under the guise of being a home health care nurse, she visited patients' residences then searched for and stole their pain medications. Many of the victim patients were Medicare and Medicaid beneficiaries with serious illnesses including cancer.

Physicians and Other Health Care Professionals

In California, a psychologist, who was found guilty in a June 2004 trial, was sentenced to prison and ordered to pay $250,000 in restitution for charges related to fraudulent Medicare claims. The psychologist billed $1.3 million worth of psychotherapy services for developmentally disabled Medicare beneficiaries that were not rendered.

In Ohio, a podiatrist was ordered to pay $11,000 in restitution and fines for health care fraud. Between 1997 through 2002, the podiatrist improperly billed Medicare by falsely overstating that he had performed a more complex service when he actually performed routine nail care.

Other Cases of Interest

In Kansas, a claims processor for a private insurer was ordered to pay $3,000 in restitution for false statements. The woman improperly processed claims, causing Medicare payments to be processed as the primary insurance when, in fact, Medicare should have been the secondary payer.

Durable Medical Equipment

In Kentucky, an owner of a durable medical equipment company was sentenced to six months home detention and ordered to pay $708,000 in restitution for payment of kickbacks. From approximately 1992 to 2002, the man paid kickbacks to a physician and his office manager in return for patient referrals to his company for oxygen and oxygen-related products.

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