Missouri

May 13, 2010

Former Pharmacy Technician Indicted On Health Care Fraud Charges (U.S. Attorney for the Eastern District of Missouri)

St. Louis, Missouri - The U.S. Attorney’s Office announced on May 13, 2010, that Karen Williams was indicted on multiple fraud charges involving her scheme to fraudulently obtain prescription drugs, and bill them to patient insurance companies.

According to the indictment, Williams was employed as a pharmacy technician at a Walgreens on St. Charles Rock Road. Between 2007 and 2009, Williams created fraudulent prescriptions to obtain drugs and medical supplies, including  controlled substances, such as hydrocodone, codeine, and Norco  used to control pain; syringes; phentermine, a controlled substance used for weight reduction; Furosemide, a diuretic; antibiotics, such as penicillin, amoxicillin, azithomycin, doxycycline; and Famciclovir and Valtrex, which are antiviral medications. Williams used the names of several doctors and an advanced practice nurse, without their knowledge; and she also used the names of actual Walgreens’ patients without their knowledge to submit bills to the patients’ health insurance companies. The indictment alleges that on some occasions Williams had a unidentified person pick up the prescription drugs from the pharmacy and then give them to her.

Williams, 32, was indicted by a federal grand jury on one felony count of health care fraud, nineteen felony counts of making false statements, and one felony count of illegal possession of hydrocodone. She is expected to appear in federal court this week.

If convicted, health care fraud carries a maximum penalty of 10 years in prison and/or fines up to $250,000; each count of making false statements carries a maximum penalty of five years in prison and/or fines up to $250,000; and possession of hydrocodone carries a maximum penalty of four years in prison and/or fines up to $250,000.

This case was investigated by the Department of Health and Human Services, Office of the Inspector General, the Drug Enforcement Administration and the Missouri Board of Pharmacy. Assistant United States Attorney Dorothy McMurtry is handling the case for the U.S. Attorney’s Office.

The charges set forth in an indictment are merely accusations, and each defendant is presumed innocent until and unless proven guilty.

April 9, 2010

Area Podiatrist Sentenced on Health Care Fraud Charges; $250,000 Paid in Civil and Criminal Restitution and Penalties (U.S. Attorney for the Eastern District of Missouri) 

St. Louis, Missouri - The United States Attorney’s Office announced today that Dr. David Quang Pham, DPM, was sentenced to 5 months imprisonment and an additional 5 months home detention for obstruction of justice in connection with false billing to Medicare and Medicaid and ordered to pay restitution in the amount of $70,000.

After learning that he was being investigated for health care fraud, Dr.  Pham created false treatment notes to reflect services that he had not provided. He then submitted these false treatment notes to agents of the United States Department of Health and Human Services, Office of the Inspector General, who had subpoenaed the treatment notes. Dr. Pham, DPM, is a licensed doctor of podiatry and is a participating Medicare and Medicaid provider, who maintains an office at 2506 Pocahontas Avenue, St. Louis, MO.

Dr. Pham submitted false claims and false medical records to Medicare and Missouri HealthNet (Medicaid) for at least 5 years. On a number of occasions, Dr. Pham submitted reimbursement claims for treating the feet of patients, whose feet had been amputated prior to the dates of service. Dr. Pham also falsely claimed he had provided services to patients in the nursing homes where they resided on days when the patients were actually hospitalized and had received no service from Dr. Pham.  Dr. Pham also permitted his unqualified assistant to provide services, although she was not a doctor, nurse, or otherwise trained or licensed to provide the service.

Dr. Pham provided services to patients at nursing homes and residences for older adults, including Abbey Care Center, Alexian Court Apartments, Beverly Farm (IL), Claru Deville Nursing Center, Columbia Convalescent Center (IL), Creve Coeur Manor, Delmar Gardens of Chesterfield, Four Fountains Convalescent Center (IL), Grand Manor Nursing and Rehabilitation, Hillside Manor Healthcare and Rehab Center, Normandy Nursing Center, Ozark Manor Residential Care Center, Parkview Apartments, Rancho Manor Health Care and Rehab Center, Rosewood Care Center (IL), St. Paul’s Home (IL), St. Elizabeth Healthcare, The Cedars at JCA, and University Forest Nursing Care Center.

Dr. David Quang Pham, DPM, 50, St. Louis, 63144, pleaded guilty in January to one felony count of obstruction of a criminal investigation of health care offenses.  He appeared today for sentencing before United States District Judge Donald J. Stohr.

In January, Dr. Pham also agreed to pay $180,000 to the United States in a related civil settlement agreement.  In the civil settlement agreement, the United States alleged that Dr. Pham submitted false and fraudulent claims to Medicare in violation of the False Claims Act.  As part of the civil settlement agreement, Dr. Pham agreed to be excluded from participation in all federal health care programs, including Medicare, for a period of five years.  

This case was investigated by the Department of Health and Human Services Office of Inspector General.  Assistant United States Attorney Dorothy McMurtry is handling the case for the U.S. Attorney’s Office.

March 23, 2010

United States Awarded More Than $19 Million Plus Interest Against Renal Care Group & Fresenius Medical Care (U.S. Attorney for the Eastern District of Missouri)

St. Louis, Missouri - The United States Attorney’s Office announced that in a "whistleblower" case originally filed in St. Louis in 2005, a federal judge, on March  23, 2010, awarded the United States $19,366,705 plus interest after finding that Renal Care Group, Renal Care Group Supply Company and Fresenius Medical Care Holdings, Inc. recklessly disregarded federal law when billing the Medicare program for home dialysis supplies and equipment during 1999-2005. 

The Court's Order discusses the complaints and concerns of multiple Renal Care Group employees who complained about the operation and Medicare billing activity of the Renal Care Group Supply Company, including one employee who wrote "I do not wish to go to jail" and felt the company "was not in the best interests of patients" after receiving a corporate directive about converting patients into the Renal Care Group Supply Company. 

The Court's Order further notes that Renal Care Group failed to heed the advice of the company's lawyers when operating the supply company, and discussed an internal audit of the supply company that found that one hundred percent of the company's files were missing information that Medicare required for billing Renal Care Group, ("RCG"), was a publicly traded for-profit corporation and dialysis provider until it merged with dialysis industry competitor Fresenius Medical Care ("FMC").

RCG had its principal place of business in Nashville, Tennessee, and had locations throughout Missouri, including multiple facilities in the St. Louis metropolitan area.  RCG Supply Company ("RCGSC") was a Tennessee corporation that was owned and operated by RCG.   In August 2009, a District Court Judge in St. Louis transferred the case to the Middle District of Tennessee for trial, finding that a trial in Nashville, Tennessee would be more convenient for many witnesses.  FMC now owns and operates RCGSC and RCG's dialysis facilities after the merger with RCG. Renal Care Group was in the business of providing renal dialysis and related services to patients with End-Stage Renal Disease (ESRD). ESRD is a life threatening condition in which a patient's kidneys are unable to remove toxins from the blood, thus necessitating some form of dialysis treatment. This condition is often suffered by patients who have experienced chronic kidney disease over a period of time. The Government's Medicare program generally provides coverage for ESRD patients.

The Government's complaint alleged that between January 1999 and December 2005, RCGSC submitted claims to the Medicare program for home dialysis supplies provided to End-Stage Renal Disease patients for reimbursement of the supplies and equipment. All of these claims, as well as related claims for support services rendered by RCG dialysis clinics were false because the defendants were prohibited from and not qualified to bill Medicare for these home dialysis patients. Under federal law, the Medicare program pays companies that provide dialysis supplies to ESRD patients only if the companies that provide the supplies are truly independent from dialysis facilities and the ESRD patient chooses to receive supplies from the independent supply company. Defendants set up a sham billing company, RCGSC, that was not independent from RCG. Further, RCG interfered with ESRD patients' choice of supply options, requiring patients to "move" to RCGSC. Even after RCG employees raised concerns and industry competitors closed their supply companies, RCG kept RCGSC open because of the illicit revenue it created.

Special Agent in Charge Gary M. Holst of the Kansas City Regional Office of Investigations for the Office of Inspector General of the Department of Health and Human Services stated "These investigations and their outcomes protect the tax payer from waste, fraud, and abuse.  We will continue to aggressively pursue those who seek to defraud the Medicare and Medicaid programs."

This is the second Medicare fraud case focused on the dialysis industry brought by the Eastern District of Missouri.  In December 2005, Gambro Healthcare, a leading owner and operator of renal dialysis clinics in the United States, paid the United States $310.5 million to resolve civil liabilities stemming from alleged kickbacks paid to physicians, false statements made to procure payment for unnecessary tests and services, and payments made to Gambro Supply, a sham durable medical equipment company.   

The case was investigated by Federal Bureau of Investigation and the Office of Inspector General for the Department of Health and Human Services.  The case was litigated by the United States Attorney's Offices for the Eastern District of Missouri and the Middle District of Tennessee and the Civil Division of the United States Department of Justice.

March 15, 2010

Founder/CEO, Brother, Healthnet Regional Center of Cuba Indicted on Health Care Fraud Charges (U.S. Attorney for the Eastern District of Missouri)

St. Louis, MO - The United States Attorney’s Office announced today that James and Dennis Froeschner and Healthnet Regional Center of Cuba were indicted on multiple counts of submitting false reimbursement claims for non-rendered health services to Medicare and MO HealthNet.

According to the indictment, James Froeschner was president and CEO of Healthnet (HRCC), and his brother Dennis Froeschner did the billing. HRCC is owned by Novae Health Net, which is owned by James Froeschner.

Rural health centers, such as HRCC, provide services in medically under served areas and are reimbursed for visits, called encounters. MO HealthNet defines a visit as a face to face encounter between the patient and either a physician, nurse practitioner, nurse midwife, physician assistant, licensed clinical social worker, or clinical psychologist.  The encounter must include a medically necessary evaluation and management service.

The indictment alleges that James Froeschner developed and distributed to his employees a written "Protocol," describing how patient appointments were to be handled at HRCC.  They basically were instructed not to indicate on daily schedules and patient records that patients did not keep their appointments. It was part of the fraud scheme that Dennis Froeschner billed for all patients on a list he had compiled of patients who were scheduled to be seen on a regular basis, although he knew some of the patients had not kept their appointments.

According to the indictment, Dennis Froeschner also billed for health services to relatives accompanying a patient to HRCC although the relatives received no services, for chart reviews where the records do not indicate a  physician reviewed the charts, and for encounters  when  the only service provided was arranging transportation or authorizing a prescription refill. James Froeschner had instructed his staff to complete encounter forms for these activities.

According to the indictment, James and Dennis Froeschner submitted numerous claims for services provided on the weekends when the clinic was closed and patients did not receive services. As an example, claims were submitted for services on Mother’s Day and Easter Sunday, although the patients did not receive any services on these days.

James Froeschner, 68, Cuba, MO; and his brother Dennis Froeschner, 58, also of Cuba, were each indicted by a federal grand jury on one felony count of health care fraud and 57 counts of making false statements involving health care benefit programs. Heathnet Regional Center of Cuba, Inc., was also indicted on the same charges.

If convicted, heath care fraud carries a maximum penalty of 10 years in prison and/or fines up to $250,000; each count of making false statements carries a maximum penalty of five years in prison and/or fines up to $250,000. The penalty for Healthnet, if convicted, is a fine of $500,000 per count of the indictment.

This case was investigated by Health and Human Services Office of Inspector General.  Assistant United States Attorney Dorothy McMurtry is handling the case for the U.S. Attorney’s Office.

The charges set forth in an indictment are merely accusations, and each defendant is presumed innocent until and unless proven guilty.

March 9, 2010

With Pain Management Doctor, His Clinics, & His Billing Company for False Claims Submitted to Medicare, Missouri Medicaid & Tricare (U.S. Attorney for the Eastern District of Missouri)

St. Louis, MO - The United States Attorney’s Office announced on March 9, 2010, that the United States has reached a civil settlement with Abdul Naushad, M.D., 46, of Town and Country, MO, his wife, Wajiha Naushad, and their pain management clinics doing business as Advanced Pain Centers.  The civil settlement also resolves claims with Dr. Naushad’s billing company, Ultimate Practice Solutions, and its owner Azeem Meo, 58, of Carmel, IN.

According to the United States, Dr. Naushad and his wife own and operate six pain management clinics throughout Missouri all doing business under the Advanced Pain Center (APC) name:  Advanced Pain Center Cape, Advanced Pain Center Farmington, Advanced Pain Center Twin Cities, Advanced Pain Center St. Louis, Advanced Pain Center Eureka, and Advanced Pain Center Kennett. Mr. Meo owns and operates a billing company, Ultimate Practice Solutions, whose main business is to conduct the billing operations for the APCs.   

The United States alleges that Dr. Naushad, his wife, the APCs, Ultimate Practice Solutions, and Mr. Meo violated the False Claims Act by submitting false claims to Medicare, Missouri Medicaid, and TRICARE for spinal decompression services performed with a DRX-9000 machine.  The claims were false in that they indicated that direct one-on-one physical therapy was performed when, in fact, no one at APC performed physical therapy and APC did not even employ a physical therapist.  Physical therapy codes were falsely used to attempt to obtain payment for use of the DRX-9000 machine, which is deemed experimental, and therefore is not covered or reimbursable by Medicare, Missouri Medicaid, or TRICARE.

As part of the civil settlement, the Defendants will pay the United States $820,000.  Dr. Naushad and the APC entities will enter into an Integrity Agreement with the United States Department of Health and Human Services, Office of Counsel to the Inspector General, that requires Dr. Naushad to implement a compliance program and allows HHS to closely monitor the federal health care billings of Dr. Naushad and the APCs.  Additionally, Mr. Meo and Ultimate Practice Solutions will agree to be excluded from participation in federal health care programs for a period of five (5) years.                     

The civil settlement will include the dismissal of a qui tam complaint that was filed by whistleblowers Annetta Schwader and Amanda Richards, both former employees of APC.

United States ex. rel Amanda Richards, et al. v. Abdul Naushad, M.D., et al, Case No. 4:08CV00066-CDP (E.D.Mo.).  Under the False Claims Act, the whistleblowers, also known as Relators, are entitled to a share of the civil settlement and will receive $131,200.  

This settlement is part of an ongoing effort by the Department of Justice and the Department of Health and Human Services (HHS) to recover funds diverted from Medicare and is the result of a joint effort among the U.S. Attorney’s Office for the Eastern District of Missouri, the HHS Inspector General’s Office of Investigations, the Medicaid Fraud Control Unit of the Missouri Attorney General’s Office, and TRICARE.

January 14, 2010

Area Podiatrist Pleads Guilty to Health Care Fraud Charges (U.S. Attorney for the Eastern District of Missouri)

St. Louis, MO: Dr. David Quang Pham, DPM, has pleaded guilty to obstruction of justice in connection with false billing to Medicare and Medicaid, Acting United States Attorney Michael W. Reap announced on January 14, 2010.

After learning that he was being investigated for health care fraud, Dr.  Pham created false treatment notes to reflect services that he had not provided. He then submitted these false treatment notes to agents of the United States Department of Health and Human Services, Office of the Inspector General, who had subpoenaed the treatment notes. Dr. Pham, DPM, is a licensed doctor of podiatry and is a participating Medicare and Medicaid provider, who maintains an office at 2506 Pocahontas Avenue, St. Louis, MO.

Dr. Pham submitted false claims and false medical records to Medicare and Missouri HealthNet (Medicaid) for at least 5 years. On a number of occasions, Dr. Pham submitted reimbursement claims for treating the feet of patients, whose feet had been amputated prior to the dates of service. Dr. Pham also falsely claimed he had provided  services to patients in the nursing homes where they resided on days  when the patients were actually hospitalized and had received no service from Dr. Pham.  Dr. Pham also permitted his unqualified assistant to provide services, although she was not a doctor, nurse, or otherwise trained or licensed to provide the service.

Dr. Pham provided services to patients at nursing homes and residences for older adults, including Abbey Care Center, Alexian Court Apartments, Beverly Farm (IL), Claru Deville Nursing Center, Columbia Convalescent Center (IL), Creve Coeur Manor, Delmar Gardens of Chesterfield, Four Fountains Convalescent Center (IL), Grand Manor Nursing and Rehabilitation, Hillside Manor Healthcare and Rehab Center, Normandy Nursing Center, Ozark Manor Residential Care Center, Parkview Apartments, Rancho Manor Health Care and Rehab Center, Rosewood Care Center (IL), St. Paul’s Home (IL), St. Elizabeth Healthcare, The Cedars at JCA, and University Forest Nursing Care Center.

Special Agent in Charge Gary M. Holst of the Kansas City Regional Office of Investigations for the Department of Health and Human Services stated “These investigations and their outcomes protect the tax payers from waste, fraud and abuse.  “We will continue to aggressively pursue those who seek to defraud the Medicare and Medicaid programs.”

Dr. David Quang Pham, DPM, 50, St. Louis, 63144, pled guilty to one felony count of obstruction of a criminal investigation of health care offenses.  He appeared before United States District Judge Donald J. Stohr.  Sentencing has been set for April 9, 2010.

Obstruction of Criminal Investigation of Health Care Offenses carries a maximum penalty of five years prison and/or fines up to $250,000.

Reap commended the work on the case by the Department of Health and Human Services Office of Inspector General, and Assistant United States Attorney Dorothy McMurtry, who is handling the case for the U.S. Attorney’s Office.

January 13, 2010

Cathedral Rock Nursing Homes & A Nursing Home Operator Resolve Criminal & Civil Health Care Fraud Allegations Related To Failure Of Care (U.S. Attorney for the Eastern District of Missouri)

 Agree To Pay The United States Over $1.6 Million

St. Louis MO:  Five nursing homes operated by Cathedral Rock, a Texas corporation, pled guilty to felony health care fraud related to the failure to provide adequate care to the Medicare and Medicaid residents living in those homes, announced Acting United States Attorney Michael W. Reap. 

The majority owner of Cathedral Rock, C. Kent Harrington, also entered into a criminal deferred prosecution agreement for a period of two years.  Under the plea and deferred prosecution agreement, the five nursing homes and Harrington will jointly pay $1 million in criminal fines and penalties.  Cathedral Rock entities and Harrington will pay an additional $628,000 to resolve the civil allegations that they submitted false and fraudulent claims to Medicare and Missouri Medicaid.

The nursing homes admitted in their plea agreements that:

• at various times staffing at the nursing homes was not sufficient to provide adequate nursing care;
• at various times wound care was not provided at the nursing homes;
• residents often did not receive their medication as prescribed;
• medical records were falsified and a “charting party” occurred at SpringPlace to fill in medical records so that it appeared that all medication had been properly given, regardless of whether the medication was actually given or not; and
• the nursing homes submitted fraudulent claims to Medicare and Missouri Medicare for services that were not provided or were worthless.

Entering pleas today:

Cathedral Rock of St. Louis, Inc. d/b/a SpringPlace Care Center (Springplace), formerly located at 3450 Russell Boulevard, St. Louis, Missouri  63104.  Springplace closed on June 30, 2004.

Cathedral Rock of Baden, Inc. d/b/a McLaran Care Center (McLaran), formerly located at 1265 McLaran, St. Louis, Missouri  63147.  On May 31, 2005, Cathedral Rock ceased operating the facility at this location.  

Cathedral Rock of Ballwin, Inc. d/b/a Oak Forest Skilled Care, located at 1441 Charic Drive, Ballwin, Missouri  63021.  On December 31, 2009, Cathedral Rock ceased operating the facility at this location.

Cathedral Rock of North St. Louis, Inc. d/b/a Cathedral Gardens Care Center, located at 2600 Redman Road, St. Louis, Missouri  63136.  On December 31, 2009, Cathedral Rock ceased operating the facility at this location.

Cathedral Rock of St. Charles, Inc. d/b/a Blanchette Place Care Center Blanchette located at 2840 West Clay, St. Charles, Missouri 63301.  On December 31, 2009, Cathedral Rock ceased operating the facility at this location.

In addition to the corporate guilty pleas, C. Kent Harrington, 60, of Ft. Worth Texas, has been charged in a criminal complaint, with defrauding Medicare and Medicaid by submitting false statements and claims for  the grossly deficient care provided to residents of the Cathedral Rock nursing homes. Harrington has entered a two year deferred prosecution agreement with the United States Attorney’s Office and has agreed that he will implement a rigorous compliance program in the facilities that he owns or operates to insure that residents receive quality care. If Harrington  complies with the conditions in the deferred prosecution agreement, the criminal felony complaint will be dismissed on January 7, 2012.

These five nursing homes and Harrington now face criminal fines and penalties totaling $1,000,000.

In addition to the criminal pleas, the United States also today entered into a civil settlement with these same defendants, and other related Cathedral Rock entities, including Cathedral Rock of Rolla d/b/a Heritage Park Skilled Care.  The civil settlement will resolve allegations that the civil defendants violated the False Claims Act by submitting fraudulent claims to Medicare and Missouri Medicaid for care that was not provided to the nursing home residents. 

In the civil case, the United States alleged that due to the lack of adequate and properly trained staff at the nursing homes and the widespread falsification of residents’ medical records, numerous residents suffered from malnutrition, dehydration, preventable pressure sores, and preventable side effects from not receiving their medications.  Some residents simply wandered away from the homes, sometimes with Cathedral Rock staff not noticing that the residents were gone until many hours later.  One resident was almost hit by a car after leaving a Cathedral Rock facility while using a walker.  Other residents underwent amputations of feet and legs because pressure sores formed and were left untreated, and in some cases the pressure sores had become infested with maggots.  The United States alleged that basic needs of the residents such as feeding and toileting those who needed assistance, turning bed-ridden residents, and bathing were not met. 

The civil settlement will include the dismissal of a qui tam complaint that was filed by whistleblowers Michele Kimball and Anna Juelfs, both former employees of Springplace.  United States of America ex rel., Michele Kimball and Anna Juelfs v. Cathedral Rock Corporation, Cathedral Rock Management I, Inc., Cathedral Rock of St. Louis, Inc. d/b/a SpringPlace Care Center, et al., Case No. 4:03CV1090-HEA (E.D.Mo.).  Under the False Claims Act, the whistleblowers, also known as Relators, are entitled to a share of the civil settlement and will receive $94,200.  

“Today’s five guilty pleas and civil settlement agreement demonstrate this office’s continuing commitment to fight health care fraud, especially when it involves the vulnerable and elderly.  This office has shown, through this prosecution and prior prosecutions, that it will continue to work with its state and federal law enforcement partners to pursue civil and criminal prosecution of nursing homes and their operators when they fail to provide care that is being paid for by the taxpayers,” said Reap.

As part of the civil settlement, the Office of Inspector General of the Department of Health and Human Services (OIG) required Cathedral Rock, Harrington, and other related corporate entities to enter into a 5-year Corporate Integrity Agreement (CIA) that includes extensive quality-of-care provisions.  Under the CIA, Cathedral Rock must, at its own expense, retain an independent monitor appointed by OIG to assess and monitor the effectiveness of Cathedral Rock’s internal quality control systems which will allow for close monitoring of all of the nursing homes that Cathedral Rock continues to operate, none of which are in Missouri.

“Protecting the Federal health care programs is about more than financial recoveries, it is also about protecting beneficiaries from substandard care. As a result of the investigation, Cathedral Rock has ceased operations in Missouri and, under the CIA, must improve the quality of care provided in its remaining nursing facilities,” said Lewis Morris, Chief Counsel to the HHS Inspector General.  

Gary M. Holst, Special Agent in Charge of the Kansas City Regional Office of Investigations for HHS noted, “These investigations and their outcomes not only protect the taxpayers from waste, fraud, and abuse, but more importantly serve to protect the most vulnerable and precious in our society:  the elderly.  We will continue to aggressively pursue quality of care cases to insure that our Medicare beneficiaries receive the care that they need.”

Reap commended the work on this case by the Office of Investigation for the Inspector General of the United States Department of Health and Human Services, the Federal Bureau of Investigation, the United States Postal Inspection Service, the Medicaid Fraud Control Unit of the Missouri Attorney General’s Office, and the Missouri Department of Health and Senior Services.

January 12, 2010

United StatesReaches $200,000 Civil Settlement with South St. Louis Orthopedic Group & Dr. Mitchell Mirbaha (U.S. Attorney for the District of Missouri)

St. Louis MO:  Acting United States Attorney Michael W. Reap announced on January 11, 2010, that the United States, South St. Louis Orthopedic Group, Inc. (SSLOG), and Mitchell M. Mirbaha, M.D., reached a $200,000 civil settlement to resolve the United States' claims under the False Claims Act for false Medicare and Missouri Medicaid billings related to podiatry services rendered by Dr. Denise Hardy while she was an employee of SSLOG.  Dr. Mirbaha is the president and director of SSLOG. 

In March of 2009, SSLOG (a Missouri corporation) and Dr. Hardy pled guilty to health care fraud charges related to claims for podiatry services that were submitted to Medicare and Missouri Medicaid from 1998 to 2005.  The claims were submitted while Dr. Hardy was an employee of SSLOG.  As part of a scheme to defraud Medicare and Missouri Medicaid, Dr. Hardy made false statements in her treatment notes in order to have claims for non-covered services paid by Medicare and Missouri Medicaid.  In September of 2009, Dr. Hardy was sentenced to three months imprisonment, SSLOG was placed on probation for two years, and SSLOG and Dr. Hardy were jointly ordered to pay over $89,000 in criminal restitution to Medicare and Missouri Medicaid.

In the civil settlement, the United States alleged that SSLOG and Dr. Mirbaha caused the submission of the false claims and were unjustly enriched by the Medicare and Missouri Medicaid payments in that they received a portion of the revenue generated by Dr. Hardy's health care fraud scheme.  The $200,000 civil settlement with SSLOG and Dr. Mirbaha will be paid in addition to the restitution previously ordered in the criminal case.

Reap commended the work of the Health and Human Services, Office of Inspector General, Office of Investigations and commented that this case shows the concerted effort by the Department of Justice and HHS to recover funds diverted from the Medicare Trust Fund.

January 7, 2010

Local Otolaryngologist Indicted On Federal Health Care Fraud Charges (U.S. Attorney for the Eastern District of Missouri)

St. Louis, MO: Dr. Wallace P. Berkowitz has been indicted on multiple federal charges involving health care fraud, Acting United States Attorney Michael W. Reap announced on Jan. 7, 2010.

According to the indictment, Dr. Berkowitz is an otolaryngologist, specializing in ear, nose and throat problems.  He is a sole practitioner with offices in St. Louis City and County, and in Swansea, Alton and Glen Carbon, IL.

The indictment alleges that between 2003 and 2008, Dr. Berkowitz submitted numerous claims and received payment from Medicare and Medicaid for health care services that he did not provide at St. Alexis Senior Services Center.  Residents of nursing homes and other residential facilities were transported to St. Alexius to receive health services from various providers, including Dr. Berkowitz.  Dr. Berkowitz is charged in the indictment with falsely stating in claim forms that he spent 25 to 45 minutes examining and treating each patient when St. Alexis records document that he typically spent less than five minutes with each  patient.  The indictment also alleges that Dr. Berkowitz  falsely claimed that he had removed a foreign body from patients’  ears under anesthesia, when he actually had only removed impacted ear wax and that he had performed other surgical procedures that he did not perform. 

Berkowitz, 66, St. Louis, 63109, was indicted by a federal grand jury on one felony count of health care fraud and nineteen counts of making false statements relating to health care matters.

If convicted, health care fraud carries a maximum penalty of ten years in prison and/or fines up to $250,000; each count of making false statements carries a maximum penalty of five years in prison and/or fines up to $250,000.

Reap commended the work on the case by Health and Human Services Office of Inspector General; and Assistant United States Attorney Dorothy McMurtry, who is handling the case for the U.S. Attorney’s Office.

The charges set forth in an indictment are merely accusations, and each defendant is presumed innocent until and unless proven guilty.

September 2, 2009

Local Podiatrist Sentenced On Health Care Fraud Charges (U.S. Attorney for the Eastern District of Missouri)

months home confinement on health care fraud charges in connection with false billing to Medicare and Medicaid, Acting United States Attorney Michael W. Reap announced on Sept. 1, 2009. Dr. Hardy was also ordered to pay over $89,000 in restitution to Medicare and Medicaid.

According to court documents, Dr. Hardy created false statements on podiatric examination forms and other medical records for submission to Medicare and Missouri Medicaid for podiatric services that she provided from 2000 through 2005. Dr. Hardy, DPM, was a licensed doctor of podiatry and was a participating Medicare and Medicaid provider.

From 1998 to 2005, Dr. Hardy was employed at South St. Louis Orthopedic Group, Inc., and received an annual salary of $55,000 and 50-60% of the monthly billed revenue over $12,000. Hardy provided services to patients at the offices of South St. Louis Orthopedic Group, Inc., Lafayette Habilitation, several nursing homes, and at senior service centers at St. Alexius Hospital and St. Anthony’s Medical Center.

As part of the scheme to defraud Medicare and Missouri Medicaid, Dr. Hardy falsely stated in her treatment notes that 20 Lafayette Habilitation Center patients (who are unable to walk and confined to a wheelchair or geri-chair) cannot walk without pain and had pain when walking that restricted their activities. Due to these false statements, Medicare and Medicaid paid claims that normally would not have qualified for reimbursement.

Hardy, 45, St. Louis, 63123, pleaded guilty in March to one felony count of health care fraud. She appeared today before United States District Judge Jean C. Hamilton. Reap commended the work on the case by Health and Human Services Office of Inspector General; and Assistant United States Attorney Dorothy McMurtry, who handled the case for the U.S. Attorney’s office. For more information, visit the website of the U.S. Attorney of the Eastern District of Missouri at: http://www.usdoj.gov/usao/moe/

April 19, 2009

Local Podiatrist Sentenced For Obstructing A Federal Audit & Pays The United States $425,000 In Civil Settlement (U.S. Attorney for the Eastern District of Missouri)
               
St. Louis, MO: Dr. Bic Chau Stafford was sentenced to five months in prison and five months of home confinement for obstructing a federal audit when providing the Medicare program with a false backdated treatment record, Acting United States Attorney Michael W. Reap announced today. Dr. Stafford was also ordered pay a $25,000 fine.

Dr. Stafford billed Medicare for numerous complex foot surgery procedures allegedly provided to 39 local Medicare beneficiaries when she was really providing these patients with only routine foot care, such as toe nail clipping.  When she was audited by the Medicare program in 2007, Medicare denied her claims for reimbursement regarding these 39 beneficiaries and requested that she re-pay $6,840 to the Medicare program for these non-covered services.  Dr. Stafford challenged this overpayment determination.  As part of her efforts to avoid paying the overpayment back to the Medicare program, Dr. Stafford created new treatment records for these 39 patients in May 2007, back-dating the records with dates from December 2004 using false and fraudulent treatment information, claiming that she had provided these patients with podiatric surgical procedures instead of routine foot care.

Dr. Bic Chau Stafford practiced at the Family Foot and Ankle Care Center (“FFA”), in Maryland Heights, MO as well as assorted assisted living facilities in St. Louis City and St. Louis County.  She had been enrolled as a Medicare healthcare provider since 2004.  As a Medicare provider, Dr. Stafford was aware that Medicare does not reimburse podiatrists for routine foot care provided unless the patient has a significant medical condition that has resulted in severe circulatory complications.

Dr. Stafford also executed a civil settlement agreement with the United States requiring her to pay the Medicare program $425,000.  The conduct resolved in the civil settlement agreement covered the time frame January 2003 through October 2008, and involved Dr. Stafford billing the Medicare program for complex podiatric surgical procedures, including matrixectomies and avulsions, when she, in reality, had only provided patients with routine foot care, such as trimming toenails and removing corns and callouses.  In the civil settlement agreement, Stafford further agreed to a five year exclusion from participation in the Medicare and other federal programs, and her professional corporation FFA was permanently excluded.  

Dr. Stafford, 59, St. Louis, MO, pleaded guilty in April to one felony count of obstruction of a federal audit.  She appeared today for sentencing before United States District Judge Catherine D. Perry. 

Reap commended the work on the case by the Federal Bureau of Investigation and the Office of Inspector General for the U.S. Department of Health and Human Services.