Vice-President of Tampa Physical Therapy Company Pleads Guilty to Conspiracy To Commit Health Care Fraud

Medicare fraud criminal cases involving physical therapy are not that common but a recent case out of Florida went criminal based on allegations that involved pure fraud in billing for services not provided.  On May 27, 2011, Andres Cespedes, an owner and vice-president of a physical therapy company, Dynamic Therapy Inc.  pleaded guilty to one count of conspiracy to commit health care fraud for his role in a scheme to defraud Medicare before U.S. Magistrate Judge Mark A. Pizzo in Tampa, Florida.

According to court documents, Mr. Cespedes was the vice president of Dynamic Therapy Inc. Mr. Cespedes and his co-conspirators purchased Dynamic from its prior owners and transformed it into essentially fraudulent enterprise. Dynamic purported to provide physical therapy services to Medicare beneficiaries, but in reality obtained patient information through kickbacks and bribes and billed Medicare for physical therapy that never occurred.

According to court documents, from fall 2009 to summer 2010, Mr. Cespedes submitted and caused the submission of $757,654 in fraudulent claims to the Medicare program by Dynamic. Mr. Cespedes admitted that he and his co-conspirators paid and caused the payment of kickbacks and bribes to Medicare beneficiaries in order to obtain their Medicare billing information, and used it to submit claims to Medicare for physical therapy services that were never provided. According to court documents, the owners and operators of Dynamic also stole the identities of a physical therapist and Medicare beneficiaries in order to submit additional false claims to Medicare.

Mr. Cespedes admitted that he knew the Medicare beneficiaries, on whose behalf claims were submitted to Medicare by Dynamic, never received the services billed to Medicare. At sentencing, Cespedes faces a maximum penalty of 10 years in prison and a $250,000 fine. A sentencing date has not been set.

Attorney Commentary - Providers: Watch Out For Identity Theft:  For health care providers including physical therapists, the biggest concern raised by this case is how the identity of the physical therapist was stolen. We have seen the identities of physicians and other health care providers stolen before in a very simple manner. Companies or individuals who want to steal identities sometimes place advertisements for jobs in a newspaper or website and then the applicants will send ALL the information attached to their CV including UPIN number, social security number, license number and other identifying information. That information is then submitted on a Medicare or Medicaid application to obtain a provider number for a new location.  Therefore, be careful when applying for jobs and sending your information to blind addresses.

Posted by Tracy Green, Esq. Please email Ms. Green at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation.

Any questions or comments  should be directed to Tracy Green, a very experienced California health care attorney who has represented physical therapists and a variety of other health care providers at tgreen@greenassoc.com.

The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers in health care legal matters in California and throughout the country. Their website is: http://www.greenassoc.com/

Fired Mayo Radiology Technician With Drug Problem Indicted After He Diverted Drugs And Spread Hepatitis By Injecting Patients With Same Used Syringe He Used On Himself

An unusual health care related criminal case is pending in Jacksonville, Florida. This is not a fraud case but one where patients were allegedly harmed or killed by a hospital employee who was addicted to drugs, diverted drugs meant for patients and when he injected patients with a saline solution -- after having injected himself with the patients' drugs -- he ended up injecting and infecting patients with his own Hepatitis C virus.

On May 24, 2011, the U.S. Attorney's Office in the Middle District of Florida unsealed an indictment charging a radiology technician Steven Beumel, (48, Orange Park) with five counts of tampering with a consumer product, resulting in death or serious bodily injury, and five counts of obtaining a controlled substance by fraud. If convicted on all counts, Mr. Beumel faces a maximum penalty of life in federal prison.

According to the indictment, Mr. Beumel was a radiology technician at Memorial Hospital from May 1992 through October 2004. Mr. Beumel also worked as a radiology technician at Mayo Clinic from October 2004 through August 2010.

The indictment alleges that Mr. Beumel, before patients’ procedures, diverted syringes of Fentanyl (a synthetic opiad) meant for patients and injected himself with the Fentanyl. Mr. Beumel has allegedly admitted to been addicted to Fentanyl. He then allegedly refilled the empty syringes with saline, but these syringes were now contaminated with his own Hepatitis C Virus. Mr. Beumel has contended that he did not know he had Hepatitis C Virus.

According to the indictment, five different patients contracted Hepatitis C from Mr. Beumel. The indictment alleges that one patient died as a result from Mr. Beumel’s tampering.

An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.

This case was a joint federal and state investigation by the Federal Bureau of Investigation, the Food and Drug Administration, the Florida Department of Financial Services, and the Jacksonville Sheriff’s Office, Homicide Unit.

In a statement released by Mayo, the hospital said it continues to extend its deepest condolences to family and friends of those killed or injured by the hepatitis C transmission. Mayo has strengthened security changes to control narcotics, and expanded the hospital's drug-screening panel for potential new hires.

Commentary:  This case is a reminder that health care providers need to be careful in screening employees, monitoring employees for signs of drug or alcohol addictions, psychological problems, personality disorders and other issues employees might have that could cause them to act out and hurt other employees or patients (intentionally or inadvertently). The liability that these hospitals could face for the alleged actions of this radiology technician are significant. For smaller providers, a rogue or drug addict employee could cost them their business if there is not sufficient insurance to cover such liabilities. Moreover, an employee with a drug or alcohol problem could pose a danger to patient safety.

Health care providers need to monitor their employees and remember the great responsibility they have for patients' health. Diverting drugs is an all too common problem in hospitals and clinics.

Posted by Tracy Green, Esq. Please email Ms. Green at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation.

Any questions or comments  should be directed to Tracy Green, a very experienced California health care fraud attorney  and California Medicare fraud attorney at tgreen@greenassoc.com.

The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers and in health care fraud related matters in California and throughout the country. Their website is: http://www.greenassoc.com/