Saturday, September 27, 2014

Fraud Cases Can Take Years To Resolve – Psychiatrist’s Investigation For Overbilling State Prison Started in 2007, Charges Filed in 2008, Trial Held, and New Trial Now Ordered

Fraud cases can take years to investigate and to prosecute. Due to the lengthy statute of limitations in federal and state cases and the document intensive nature of fraud cases, many of the cases we handle are based on actions that occurred years before. It can then take years forth cases to be resolved. 

A current case pending in Monterey County Superior Court demonstrates how this can take years even though most clients want cases to be resolved as soon as possible in order to keep their reputation, business and to get on with their lives.

In mid-2006, Pedro Eva, M.D., a licensed psychiatrist, was hired as a subcontractor by RPS to perform psychiatric services at Salinas Valley State Prison (SVSP) pursuant to a contract between RPS and California’s Department of Corrections and Rehabilitation (CDCR).  Under the contract, RPS psychiatrists may only charge for time actually spent in the prison.  However, Dr. Eva alleged that he was not informed of that requirement; instead, he understood his job consisted of four 10-hour days, and alleged that the acting chief psychiatrist at SVSP, David Hoban, told him he should bill for 10 hours even if he was not inside the prison the whole time.

At some point in 2007, California’s Office of the Inspector General (OIG) began investigating the billing practices of contract psychiatrists working at SVSP.  In the investigation, a number of doctors' hours were tracked using GPS, cellphone records and rental car receipts. The state alleged that some of the doctors overbilled the state by $200,000 during a three-month period by claiming they were on prison grounds when they were not.

The case turned criminal and in November 2008, an indictment was filed against Dr. Eva in Monterey County Superior Court, charging him with grand theft, presentation of fraudulent claims, and conspiracy to commit grand theft.  Dr. Lee, Dr. Hoban, and others were also indicted on charges related to the submission of allegedly false time sheets.

Two of the doctors, Randy Sid and David Hoban, plead guilty to felony charges that were reduced to misdemeanor counts upon payment of restitution and completion of community service. Charges against Dr. Charles Lee were dismissed.

In early 2014, Dr. Eva’s case went to trial on charges of grand theft and filing false claims for allegedly overbilling the state for his services. Dr. Eva was convicted in February 2014, but he won a new trial on the ground that the jury received improper instructions. Six members of that same jury sent Judge Hayes a letter after the trial, saying they felt Eva was the “fall guy” in the overbilling conspiracy that started with Eva’s superior, prison chief of medical services Dr. Charles Lee, and included other prison doctors, too. “It seemed evident that Dr. Eva was a very good psychiatrist whose life has now been ruined,” the letter states. “This does not feel like justice.”

Dr. Eva goes back to court on September 30, 2014 for a trial setting date. It has been almost 6 years since charges were originally filed and has been 10 years since the billings at issue were provided. These cases can take on a life of their own and obtaining easy resolution especially when some of the codefendants have plead guilty is not a simple task. To fight these cases takes resolution an determination from the attorneys and the clients.

Posted by Tracy Green, Esq.
Green and Associates, Attorneys at Law
Office: 213-233-2260

Wednesday, August 27, 2014

Louisiana Psychiatrist Sentenced to Serve More Than 7 Years in Prison for Role in Medicare Fraud Case Involving Partial Hospitalization Psychiatric Services

A Louisiana psychiatrist, Dr. Zahid Imran, was sentenced in federal court in Baton Rouge, Louisiana, on August 25, 2014 to serve 86 months in prison for his role in a Medicare fraud case involving partial hospitalization psychiatric services. 

The sentencing followed his guilty plea. He was further ordered to pay $43.5 million in restitution and to forfeit all proceeds from the fraudulent scheme. Chief U.S. District Court Judge Brian A. Jackson of the Middle District of Louisiana imposed the sentence and ordered Dr. Imran to self-surrender by September 29.

According to documents filed in the case, Zahid Imran, M.D., 56, of Baton Rouge, served as the medical director of Shifa Community Mental Health Center of Baton Rouge, and co-owned Serenity Center of Baton Rouge and Shifa Community Mental Health Center of Texas.   As part of the alleged fraud, Dr. Imran admitted mentally ill patients to the facilities, some of whom were inappropriate for partial hospitalization, and then re-certified the patients’ appropriateness for the program in an effort to continue to bill Medicare for services. 

To support the fraudulent Medicare billing, it was alleged that Dr. Imran and others allegedly falsified patient treatment records to reflect services on dates when no such services were provided. Dr. Imran pleaded guilty on May 13, 2014, to conspiracy to commit health care fraud. There were allegations that the patients were brought in by buses from Memphis and other areas which is indicative of illegal marketing.

This was a wide-ranging prosecution that began with an investigation in 2011 into the three community mental health centers. This investigation has resulted in 17 convictions of individuals employed by the facilities, including therapists, marketers, administrators, owners and the medical director.  The companies billed Medicare for partial hospitalization program services for the mentally ill that were allegedly unnecessary or never provided over a period of approximately seven years. The companies, collectively, submitted more than $258 million in claims to Medicare during this period. Medicare paid approximately $43.5 million on those claims.

Attorney Commentary: The days where facilities could avoid fraud charges by seeing patients are over. Prosecutors are no longer afraid to tackle medical necessity. This is especially true in psychiatric cases where the people served are mentally ill, poor and not receptive to treatment. Add marketing and patients who travel for services and there are significant red flags for audits and investigations.

Posted by Tracy Green, Esq.
Phone: 213-233-2260
Green and Associates, Attorneys at Law

Tuesday, August 26, 2014

Co-Owner of Florida Home Health Company Sentenced to Serve 70 Months in Federal Prison and Ordered to Pay $6.2 million in Restitution for Participation in a Health Care Fraud Scheme Where Services Were Medically Unnecessary, Services Were Not Provided, Kickbacks Were Paid, And Patient Documentation Falsified

The criminal cases against home health owners continue to increase. On August 26, 2014, a co-owner of Professional Medical Home Health LLC, Annarella Garcia, 44, of Florida was sentenced to serve 70 months in prison and ordered to pay $6.2 million in restitution for her participation in a health care fraud scheme involving the now defunct home health care company. U.S. District Judge Federico A. Moreno of the Southern District of Florida imposed the sentence.

According to court documents, Ms. Garcia was a co-owner of Professional Medical Home Health, a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries.  On June 25, 2014, Ms. Garcia pleaded guilty to conspiracy to commit health care fraud.  Ms. Garcia admitted in her plea that between December 2008 and February 2014, she and others were engaged in a scheme to bill the Medicare Program for expensive physical therapy and home health care services that were not medically necessary or were not provided.   During that time, Professional Medical Home Health was paid approximately $6.25 million by Medicare for the fraudulent claims.

Specifically, Ms. Garcia admitted that she and her co-conspirators paid kickbacks and bribes to patient recruiters in return for their providing patients to Professional Medical Home Health for home health and therapy services that were not medically necessary or were not provided.   In furtherance of the scheme, Ms. Garcia admitted that she and her co-conspirators falsified patient documentation to make it appear that beneficiaries qualified for and received home health care services, when, in fact, many of the beneficiaries did not actually qualify for such services and did not receive such services.

Attorney Commentary:  This is a lengthy sentence for a plea. The determining factor may have been that in the Indictment there was a money laundering count due to cashing checks for cash that gave exposure up to 20 years' in prison while the health care fraud charge carries a maximum of 10 years. The plea was to the conspiracy to commit health care fraud which saved exposure on the money laundering count.  There were also false statement charges that could carry additional consecutive time. This case moved quite quickly from indictment to plea to sentence, just over 3 months.  

Posted by Tracy Green, Esq.
Office: 213-233-2260
Green and Associates, Attorneys at Law

Friday, August 22, 2014

Investigations Continue Post-Arrest As Shown By Physician Arrested For Second Time While Charges Pending. Lesson: What Not To Do While On Bail

One of the terms and conditions of bail is "to obey all laws." Committing an offense while on bail is a separate offense and can result in loss of bail. We have had cases where a client committed a new offense while out on bail and it can complicate greatly the defense of a case.

Last week, Yahya Hedvat, a Los Angeles doctor awaiting trial for allegedly prescribing and selling narcotics without a legitimate reason, was arrested for selling hydrocodone to undercover agents. He was arraigned in Los Angeles County Superior Court and pleaded not guilty on August 19, 2014 to the charge in the second case of sale of a controlled substance. His bail was set at $1 million bail. It is also likely that a motion was filed to revoke or increase bail in his first case.

According to City News, Dr. Hedvat was scheduled to go on trial this month on a 10-count indictment accusing him of unlawfully prescribing the drugs hydrocodone, clonazepam and suboxone. Dr. Hedvat was free on his own recognizance while awaiting trial and had surrendered his federal license to prescribe controlled substances, according to the District Attorney's Office. 

On August 8, an undercover investigator with the California Medical Board went to Dr. Hedvat's clinic and allegedly negotiated the purchase of narcotics, including Norco and Ativan. Undercover agents allegedly bought the drugs in the clinic's parking lot from Dr. Hedvat's office assistant, Nikravan Hormuz, 70, who was also charged.

Mr. Hormuz pleaded not guilty to the sale of a controlled substance count and posted bail early Saturday. Dr. 
Hedvat's bail was more complicated and he was not able to post bail at the first appearance.  

Attorney Commentary: It is quite likely that the investigation was continued in order to obtain more evidence on the first case or to create another case -- which is what has occurred here.  Without a DEA registration, the charge is more serious and enhances the punishment that the doctor faces in his case.

Penal Code Section 23 Order Pending Criminal Case
The new case greatly impacted the criminal case in another way in that it prompted the Medical Board to seek an interim suspension order against him under the authority of Penal Code Section 23.  On August 22, 2014, the Judge in issued a PC23 Order that restricted Dr. Hedvat from practicing pending the criminal case.  Under the Order, as a condition of bail or own recognizance (O.R.) release during the pendency of this criminal action until its final conclusion and sentence, Dr. Hedvat shall:
1.    Forthwith cease and desist from practicing as a physician and surgeon;
2.    Be restricted from prescribing, ordering, administering, furnishing, or dispensing any drugs;
3.    Surrender to the clerk of the Court, any prescription forms in his possession;
4.    Be prohibited from obtaining, ordering, or using any additional prescription forms; and inform his patients that he is not currently permitted to prescribe any drugs due to a pending matter. 

The Penal Code Section 23 orders can range from restrictions on practicing to outright prohibition on practicing while the criminal case is pending. This was a complete prohibition and will cause the physician additional economic and professional consequences while the criminal cases are resolved.  

When we have a client charged, it is critical to ensure that they (and their office staff) are not engaged in any acts that could be used to revoke bail or create new charges. While it may be difficult for clients to accept the fact that they will need to give up certain activities that may be legal (prescribing any controlled substances for example where there is a valid DEA registration), even that may be preferable to having to defend one's clinical judgment.  In this case, it was allegedly more serious without the DEA registration and with an office person who was allegedly engaged in activities that could never be legal.  

The lesson: if you are under investigation or charged, be paranoid.  Be careful. Do not assume that an investigation is "over" and that law enforcement or the Medical Board does not continue to send in invetigators.

We have seen cases where the Medical Board has sent undercover investigators to a clinic on the date the physician or other medical staff are scheduled to be in court to see what happens at the clinic without the physician.  In other words: take these investigations seriously.  

Moreover, you can use the time to create good facts and that your office has been cleaned up, is compliant with all laws and regulations. This can help in the defense of the case as well as in any further administrative proceedings. 

Posted by Tracy Green, Esq.
Phone: 213-233-2260

Wednesday, August 20, 2014

Physician In Los Angeles Convicted Of 17 Counts Of Drug Trafficking Charges For Prescription Painkillers After 3 Day Federal Trial

The Los Angeles Times has reported that on August 14, 2014, 78-year old Dr. Andrew Sun was convicted after a 3-day trial on 17 felony counts, including charges involving prescribing controlled substances (Vicodin and Xanax) without medical necessity in U.S. District Court for the Central District of California.  Three of the counts related to money laundering relating to how he handled proceeds from the prescription patients.  The case relied on undercover agents posing as patients and the tapes of the physician-patient interactions.  The clinics were in San Gabriel and Los Angeles.  

This is a follow-up on a prior post about this case.  This case was unusual since Dr. Sun had agreed to plead guilty but after appearing in court, the plea was withdrawn and/or not accepted by the Court.  The case then proceeded to trial.  

Dr. Sun is facing sentencing but he may not be doing anything helpful for his case by being interviewed by the L.A. Times.  The L.A. Times reported that the reporter interviewed him after his conviction, that he denied wrongdoing, the case was "unfair" and complained that his lawyers would not let him testify.  

There are also forfeiture issues and they are scheduled to be addressed at the next court hearing on August 25, 2014.

Posted by Tracy Green, Esq.
Green and Associates, Attorneys at Law
Phone: 213-233-2260

Thursday, July 31, 2014

Owner Of Los Angeles Home Health Agency Sentenced To Nearly Five Years For Health Care Fraud Case Involving Kickbacks to Doctors and Medicare Patients Who Did Not Qualify for In-Home Health Services. Related Qui Tam Lawsuit Settled.

On July 29, 2014, U.S. District Judge Dean D. Pregerson sentenced a registered nurse, Hee (“Angela”) Jung Mun, who operated GreatCare Home Health, Inc., a home health agency to 57 months in federal prison. In addition to the prison term, Judge Pregerson also ordered Mun to pay $5.144 million in restitution to Medicare. As part of the investigation, authorities previously seized $1.2 million from bank accounts owned by Mun and GreatCare. Another federal judge ordered Mun to pay nearly $15 million to resolve a “whistleblower” lawsuit associated with this case. 

Ms. Mun pleaded guilty in 2012 and admitted orchestrating a three-year scheme to defraud Medicare. In her plea agreement, Ms. Mun admitted that she defrauded Medicare out of millions by:

(1) paying illegal kickbacks to doctors and individuals known as “cappers” or “marketers” for patient referrals, and to patients themselves to sign up for home health services,

(2) billing Medicare for patients who were not homebound or who otherwise did not quality for home health services, and

(3) billing Medicare for services provided by unlicensed individuals or not provided at all.

The scheme targeted elderly, primarily Korean, Medicare beneficiaries. GreatCare was shut down by federal agents after the execution of a search warrant there in March 2011.

While Ms. Mun was the alleged leader, seven other defendants have been convicted in related cases for their roles in the Greatcare fraud case - four of whom have already been sentenced:

(1) Sang Whan Ahn, 60, who recruited many of GreatCare’s Medicare beneficiaries in exchange for illegal kickbacks, was sentenced to four months in prison;

(2) Doctor Whan Sil Kim, also known as “Victoria,” 71, was sentenced to a year and a day in prison for receiving illegal kickbacks for health care referrals;

(3) One of GreatCare’s nurses, Hwa Ja Kim, also known as “Helen,” 70, was sentenced to 18 months in prison for signing off on patient evaluations and visits she did not do;

(4) Yeong Ja Lee, 52, one of the unlicensed individuals Greatcare used to see patients and create fake paperwork, was sentenced to 15 months in prison just last week;

(5) Physical therapist Seonweon Kim, 48, is scheduled to be sentenced on October 6; 

(6) GreatCare employee Jung Sook Lee, 53, is scheduled to be sentenced on October 20; and

(7) Registered nurse Ji Hae Kim, 43, is a fugitive.

Attorney Commentary:

In a related “whistleblower” qui tam lawsuit brought in March 2010 by one of GreatCare’s former receptionists, two other GreatCare referring doctors, Dr. Dong Shin and Dr. Bo W. Paik, agreed to pay $217,810 and $530,000, respectively, to resolve allegations that they received cash payments and patient referrals in exchange for referring Medicare beneficiaries to GreatCare and signing false certificates of medical necessity. The government did not intervene in this case but participated in the settlement negotiations. Dr. Shin has paid $150,000 and is to make monthly payments.  

Defendant Dr. Kim has agreed to pay $1.088 million as a part of a consent judgment for her conduct, while Defendant Seonweon Kim has agreed to pay $205,000 to resolve his civil liability related to GreatCare. Defendant Mun defaulted in the case and has over a $14 million default judgment entered against her. 

The sentences in these cases are lengthy in large part because of the large amount of Medicare billings (in excess of $5 million) and the defendants are charged in conspiracy counts where they are held responsible for the entire billings even where they did not collect the amounts billed or were paid salaries. In this case, the search warrant was executed in March 2011 and there 

Posted by Tracy Green, Esq.
Phone: 213-233-2260

Green and Associates, Attorneys at Law


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