On March 17, 2009, a federal jury in Miami today convicted two physicians and two medical assistants in connection with a $5.3 million Medicare fraud scheme.
After a two-week trial in federal court in Miami, a jury found two physicians (David Rothman, M.D., 66, and Keith Russell, M.D., 65) and two medical assistants (Eda Marietta Milanes, 43, and Jorge Luis Pacheco, 50) guilty on all charged counts, including conspiracy to commit health care fraud and multiple counts of health care fraud for submitting claims to Medicare for unnecessary medications. U.S. District Judge Ursula Ungaro of the Southern District of Florida remanded the defendants into custody following the verdict.
According to evidence presented at trial, the defendants worked as doctors and medical assistants at two Miami clinics, Medcore Group LLC (Medcore) and M&P Group of South Florida Inc. (M&P Group), that purported to specialize in the treatment of human immunodeficiency virus (HIV). Evidence at trial established that Rothman was the medical director for both Medcore and M&P Group between May 2004 and January 2006. Russell took over as medical director at M&P Group after January 2006. Pacheco and Milanes worked as medical assistants for Russell at M&P Group.
One of the owners of the clinics, Tony Marrero, testified at trial that the clinics were established for the sole purpose of defrauding Medicare. Marrero testified that the scheme was to submit claims for medically unnecessary HIV infusion and injection treatments. Evidence at trial showed that Medcore and M&P Group billed Medicare for $5,300,186 and were paid $2,511,387 during two years of operations. Marrero testified that the unnecessary medicines were not administered to patients, and that the clinics were only operated to create the appearance of legitimacy.
Marrero stated that he had an arrangement with a pharmaceutical wholesale company, Lifecare Medical, to buy invoices showing the purchase of large amounts of medications, when only minor amounts were actually bought. Marrero; his wife, Belkis Marrero; his brother-in-law, Orlando Pascual; the owner of Lifecare Medical, Harold Sio; a patient recruiter and clinic employee, Alberto R. Gonzalez; and a medical assistant at Medcore, Luz Borrego; each previously pleaded guilty in connection with this scheme.
Borrego testified that she manipulated the patients’ blood samples at Medcore to ensure that lab results would appear to support the Medicare claims. Borrego stated that she would not give the medications ordered by Rothman because she knew the medications could harm the patients.
Trial testimony established that every patient who went to Medcore and M&P Group was paid a cash kickback of up to $200 per visit. The scheme relied upon 20 patients during the two-year period at both clinics. Four patients testified that they took kickbacks and never received any medication at the clinics. One patient testified that he used his payments from the clinics to support his cocaine addiction. Another patient testified that he did not have HIV, even though the clinics’ documents showed he was being infused with medication to treat HIV.
Evidence introduced at trial documented that Rothman worked at other Miami-area infusion clinics, which billed Medicare for more than $60 million between 2004 and the end of 2005. Trial evidence also established that Russell worked at Tendercare Medical Center (Tendercare), another fraudulent infusion clinic, with Pacheco and Milanes at the same time as M & P Group. Further, two of the patients who testified at trial received kickbacks from both Tendercare and M&P Group.
According to evidence presented at trial, Milanes was paid extra by Marrero at M&P Group to manipulate blood samples to justify the false claims. Pacheco worked directly for Marrero to determine what drugs would be falsely billed to Medicare through M&P Group. Trial testimony established that Pacheco was a physician in Cuba prior to coming to the United States.
“The Medicare program relies on physicians to be the first line of defense against fraud,” said Bernardo Rodriguez, Acting Special Agent-in-Charge of the Miami Office of Inspector General, Department of Health and Human Services. “As in this case, when doctors shirk that responsibility and steal from Medicare, we have to prosecute them to the fullest extent of the law.”
Pacheco and Milanes were remanded into custody following the verdicts. Rothman and Russell were required to post bond and are under house arrest until sentencing. Rothman faces a maximum of 50 years in prison. Russell, Milanes and Pacheco each face a maximum of 30 years in prison. Sentencing for all defendants has been scheduled for June 26, 2009.
After a two-week trial in federal court in Miami, a jury found two physicians (David Rothman, M.D., 66, and Keith Russell, M.D., 65) and two medical assistants (Eda Marietta Milanes, 43, and Jorge Luis Pacheco, 50) guilty on all charged counts, including conspiracy to commit health care fraud and multiple counts of health care fraud for submitting claims to Medicare for unnecessary medications. U.S. District Judge Ursula Ungaro of the Southern District of Florida remanded the defendants into custody following the verdict.
According to evidence presented at trial, the defendants worked as doctors and medical assistants at two Miami clinics, Medcore Group LLC (Medcore) and M&P Group of South Florida Inc. (M&P Group), that purported to specialize in the treatment of human immunodeficiency virus (HIV). Evidence at trial established that Rothman was the medical director for both Medcore and M&P Group between May 2004 and January 2006. Russell took over as medical director at M&P Group after January 2006. Pacheco and Milanes worked as medical assistants for Russell at M&P Group.
One of the owners of the clinics, Tony Marrero, testified at trial that the clinics were established for the sole purpose of defrauding Medicare. Marrero testified that the scheme was to submit claims for medically unnecessary HIV infusion and injection treatments. Evidence at trial showed that Medcore and M&P Group billed Medicare for $5,300,186 and were paid $2,511,387 during two years of operations. Marrero testified that the unnecessary medicines were not administered to patients, and that the clinics were only operated to create the appearance of legitimacy.
Marrero stated that he had an arrangement with a pharmaceutical wholesale company, Lifecare Medical, to buy invoices showing the purchase of large amounts of medications, when only minor amounts were actually bought. Marrero; his wife, Belkis Marrero; his brother-in-law, Orlando Pascual; the owner of Lifecare Medical, Harold Sio; a patient recruiter and clinic employee, Alberto R. Gonzalez; and a medical assistant at Medcore, Luz Borrego; each previously pleaded guilty in connection with this scheme.
Borrego testified that she manipulated the patients’ blood samples at Medcore to ensure that lab results would appear to support the Medicare claims. Borrego stated that she would not give the medications ordered by Rothman because she knew the medications could harm the patients.
Trial testimony established that every patient who went to Medcore and M&P Group was paid a cash kickback of up to $200 per visit. The scheme relied upon 20 patients during the two-year period at both clinics. Four patients testified that they took kickbacks and never received any medication at the clinics. One patient testified that he used his payments from the clinics to support his cocaine addiction. Another patient testified that he did not have HIV, even though the clinics’ documents showed he was being infused with medication to treat HIV.
Evidence introduced at trial documented that Rothman worked at other Miami-area infusion clinics, which billed Medicare for more than $60 million between 2004 and the end of 2005. Trial evidence also established that Russell worked at Tendercare Medical Center (Tendercare), another fraudulent infusion clinic, with Pacheco and Milanes at the same time as M & P Group. Further, two of the patients who testified at trial received kickbacks from both Tendercare and M&P Group.
According to evidence presented at trial, Milanes was paid extra by Marrero at M&P Group to manipulate blood samples to justify the false claims. Pacheco worked directly for Marrero to determine what drugs would be falsely billed to Medicare through M&P Group. Trial testimony established that Pacheco was a physician in Cuba prior to coming to the United States.
“The Medicare program relies on physicians to be the first line of defense against fraud,” said Bernardo Rodriguez, Acting Special Agent-in-Charge of the Miami Office of Inspector General, Department of Health and Human Services. “As in this case, when doctors shirk that responsibility and steal from Medicare, we have to prosecute them to the fullest extent of the law.”
Pacheco and Milanes were remanded into custody following the verdicts. Rothman and Russell were required to post bond and are under house arrest until sentencing. Rothman faces a maximum of 50 years in prison. Russell, Milanes and Pacheco each face a maximum of 30 years in prison. Sentencing for all defendants has been scheduled for June 26, 2009.
Attorney Commentary: First, note that the business people who probably were the most culpable plead out and cooperated against the physicians and medical assistants. Second, if this is the type of case we come across, the physicians either were blissfully ignorant, listened to the promises of the business people on how "clean" the practice was or just somehow stuck their head in the sand since they were having a tough time, needed the money, etc. I note that the physicians are somewhat older. That is a consistent pattern. It is very hard to imagine that a business person would tell the physician that the clinic was designed for Medicare fraud.
Fourth, I doubt the physicians ever knew about the patient kickbacks. It appears that the physicians were probably not at the clinic a great deal (especially since one was also working at another clinic) and there is no indication here that the physicians owned the clinic. Fifth, the fact that one of the non-physicians stated that she would not give the patients the medications ordered by the doctor -- shows that the physician well may not have not have realized the fraudulent scheme in place.
Sixth, however, when one is at trial and the patients who were paid kickbacks are paraded in to testify and the other cooperating defendants appear and describe their fraud -- it is difficult for the physician to overcome this overwhelming evidence of fraud. Viewing it in the real time of a trial -- rather than how it occurred -- can make it difficult for the jury to imagine how anyone could not have realized there was a fraud scheme. This is one of the reasons why fraud trials can be challenging.
Any questions or comments should be directed to: tgreen@greenassoc.com. Tracy Green is a principal at Green and Associates. The firm focuses its practice on the representation of licensed professionals and businesses in civil, business, administrative and criminal proceedings, with a specialty in health care providers..
