Co-Owner of Home Health Agency and DME Company Sentenced to 96 Months In L.A. Federal Heath Care Fraud Case

On February 13, 2012, U.S. District Judge Stephen V. Wilson sentenced Evans Oniha, the co-owner of two Los Angeles-area health care companies, to 96 months in prison following a federal jury trial in the Central District of California in which the jury found Mr. Oniha guilty of one count of conspiracy to commit health care fraud, four counts of health care fraud and one count of false statements relating to health care matters. Mr. Oniha's jury trial was in July 2011. Judge Wilson also ordered Mr. Oniha to pay $7 million in restitution and to serve three years of supervised release following his prison term.

This case arose out of an investigation into power wheelchairs being billed to Medicare by Mr. Oniha's company.  This was an illegal marketing case since the companies used marketers that did not comply with STARK or Anti-Kickback laws. Mr. Oniha and his co-defendant are both originally from Nigeria. 

According to court documents, in 2002, Mr. Oniha and his co-defendant Camillus Ehigie founded and began operating Prosperity Home Health Services Inc., a home health agency, and Caravan Medical Supplies Inc., a durable medical equipment (DME) company. According to testimony presented at trial, from October 2002 to February 2011, Mr. Oniha, Mr. Ehigie and others payed “marketers” for Medicare beneficiary information, fraudulent prescriptions and other documents for DME and home health services. 

Testimony at trial showed that the marketers were individuals who acquired patient Medicare numbers and doctors’ prescriptions and sold them to Mr. Oniha. Mr. Oniha used these documents to submit and cause the submission of claims to Medicare for DME and home health services that were not medically necessary and that often were not provided to Medicare beneficiaries. In many cases, the services were provided to beneficiaries but under the laws, if there is illegal marketing the claim becomes a false claim especially where there is no medical necessity.

Prosperity submitted approximately $8 million in claims to Medicare for home health services. The DME company Caravan submitted approximately $5.8 million in claims to Medicare.

The co-defendant Mr. Ehigie pleaded guilty during trial -- two days before the jury came back with guilty verdicts on Mr. Oniha. Mr. Ehigiie plead guilty to 11 counts of health care fraud, one count of conspiracy to commit health care fraud, one count of making false statements in a federal health care investigation, and one count of obstructing a criminal health care investigation. Mr. Ehigie is scheduled to be sentenced on July 9, 2012.

Attorney Commentary: I received a call this week from a reporter who is doing a piece on health care fraud and commented how there is more fraud than ever. I replied to him that many of these cases are old and are being prosecuted before the statute of limitations run. This case, for example, goes back to 2002 and the investigation was pending for several years before charges were filed.

I mention in the article that the individuals here were from Nigeria. One of the issues in many health care fraud cases are that the individuals are originally from other countries who open health care businesses here and have no idea of the rules and regulations that govern the industry. There is almost universally no consultation with attorneys in setting up the businesses or implementing marketing plans.

In some cases, the patients received the services or DME and the defendants naively believe that just because the services or products were provided it means that there cannot be a viable health care fraud case. They do not understand that if there is illegal marketing that alone will be enough to sustain a conviction. They also fail to appreciate that when they pay marketers, those marketers will have often done illegal tactics themselves in order to secure patients (pay patients, coach patients on what to say, etc.) It is often difficult representing these unsophisticated defendants because they cannot understand how this can be a "fraud" case.

It would be very helpful for the government to require any one receiving a Medicare or Medi-Cal / Medicaid provider number to undergo a required training in the laws and regulations. When a Medicare application is submitted a signature is required stating that the person is familiar with the laws and regulations and agrees to follow them, but that would be difficult since the laws are complex and changing and even lawyers struggle to stay up with the laws. 

Posted by Tracy Green, Esq. Please email Ms. Green at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 15-minute consultation.

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 Los Angeles, California and throughout the state and country. Their website is: http://www.greenassoc.com/

Sample Victories in Administrative and Licensing Cases - Many Which Followed Criminal Investigations Or Convictions

Often I get asked the question about what kind of results we obtain in cases. I might jokingly say that lawyers are like gamblers: you only hear about their winnings. However, we have obtained some excellent results even though every case is different. 

Some cases are true damage control cases while others clearly should not rise to the level of discipline. Quite a few are in the middle. I am a believer in working on the mitigation side of the case as early as possible, securing experts and creating good facts for the client. This often takes educating a client about what it takes to get a case closed without discipline especially as Board's have gotten harsher on the discipline these past 5 years. 

The following true cases are examples of our dedication to our clients and the quality of our work:

Medical Board of California

Petty Theft Arrests And Dispositions Results in No Disciplinary Action (2011)

Doctor client had been charges twice with shoplifting. In the first case, the doctor completed a diversion and the misdemeanor charge was dismissed. In the second criminal case, in which we represented her, she was charged with felony theft and we were able to reduce the charge to an infraction after a diversion. After assisting client with disclosures to the Board, the matter was closed without any discipline. 

Four Misdemeanor Convictions Results in Probation With No Suspension Time (2011)

Doctor client had been convicted of DUI in 2011, disturbing the peace in 2010, DUI in 1995 and DUI in 1994. Aggravating factors were an arrest for DUI with no charges filed after refusal to take a blood or breath test and an arrest for public intoxication with no charges filed. We worked on creating a sobriety program with the doctor after the 2011 DUI arrest but before the Accusation was filed. Once the Accusation was filed we worked with the client on the mitigation package. The matter was settled before hearing for probation with no suspension time. 

Criminal Conviction Mandated Reporting Results in No Disciplinary Action (2010)

Doctor client had been charged with Medi-Cal fraud and we represented her in the criminal case. After the preliminary hearing, we filed a motion to dismiss and the charges against her were dismissed but one of her nonmedical corporations plead to a criminal count since there was billing for services not provided and she was an officer of the corporation. After assisting client with mandated disclosures to Board and an interview and submission of mitigating evidence, matter was closed without discipline.

Felony Criminal Conviction For Fraud Results in Probation With No Suspension Time (2010)

Doctor client had been charged with Medi-Cal fraud with over $300,000 in restitution and we represented him in the criminal case. There was devastating evidence as the clinic was run by managers who used the doctor's license to commit fraud (prescriptions for power wheelchairs, hospital beds and unnecessary diagnostic tests). After assisting client with mandated disclosures to Board and an interview, we sought to settle the matter. The Board insisted on revocation of license. After a hearing with excellent mitigation evidence and an expert witness, the hearing officer imposed probation with no suspension time and the Board adopted the decision. 

Workers Compensation Complaint Results in No Disciplinary Action (2010)

Internist doctor client had seen a workers' compensation patient for a limited purpose (high blood pressure). The patient did not have any health insurance and had other health issues for which he was not authorized to be seen by the workers' compensation doctor. The doctor's charting was problematic, the referrals to other providers were not documented and the notes were minimal. We had the doctor sign up for a charting class before the Medical Board interview, submitted mitigating evidence regarding the role of a workers' compensation doctor in treatment, and presented other mitigating evidence.  The matter was closed without discipline. 

Nursing Board of California

Texas Probation Results in No Disciplinary Action On California License (2011)

Nurse maintained her California license after she moved to Texas. Nurse was placed on probation in Texas and successfully completed probation. California opened a complaint here in California for failure to report her Texas discipline and for the underlying case in Texas. We submitted a detailed response and mitigation package requesting that the case be closed without any discipline in California. After assisting client with disclosures to the Board, the matter was closed without any discipline. 

DUI Conviction and Failure to Comply With Diversion Program Resulted in Board Filing Petition to Revoke Probation - Probation Reinstated After Hearing (2011)

Nurse was convicted of DUI and placed on probation with required participation in diversion program and drug/alcohol testing. Nurse missed numerous testings. Board filed petition to revoke probation. We reached a settlement reinstating probation with an additional year of probation after submitting an extensive mitigation package. The Board of Nursing refused to adopt the settlement and demanded we go to hearing. The Board sought revocation of the license. After a hearing, the hearing officer issued a decision reinstating the license with an additional year of probation.   

Physician Assistant Board of California

Medical Marijuana Compliant Results in No Disciplinary Action On California License (2011)

Physician Assistant was performing physical examinations on patients for medical marijuana recommendations. Physician Assistant Board's position was that only a medical doctor can perform such examinations and that the examinations cannot be delegated. After assisting client with submissions to the Board and an interview, the matter was closed without any discipline. 

Inserting Non-FDA Approved IUDs Results in No Disciplinary Action On California License (2009)

Physician Assistant was inserting IUDs on low income patients in the Medi-Cal program which turned out to be non-FDA approved and made in Canada. After assisting the client with an audit by Medi-Cal, making disclosures to patients, we helped him respond to the Board complaint. After assisting client with submissions to the Board and an interview, the matter was closed without any discipline. 

Physical Therapy Board of California

Misdemeanor Conviction for Carrying Firearm in Public Place  Results in Public Reproval (2011)

Physician Assistant was convicted of misdemeanor of carrying a firearm in a public place and had the added fact of being in the possession of marijuana legally with his medical marijuana recommendation due to a disability.  After presenting the legal arguments, mitigation package and a settlement conference, the matter was resolved with a public letter of reproval.

Posted by Tracy Green, Esq. Please email Ms. Green at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 15-minute consultation. 

Any questions or comments  should be directed to Tracy Green, a very experienced administrative law attorney, licensing attorney, and board and bureau investigations and hearing attorney at tgreen@greenassoc.com. 

What NOT To Do When A Board Or Government Investigator Requests Records Or Comes To Your Office - Part 2

This is the second in a series. The first article is entitled "What To Do When A Board Or Government Investigator Requests Records Or Comes To Your Office: What To Do And What NOT To Do - Part 1." Read Part 1 and then read this article for greater detail on what NOT to do when there is a government or board investigator asking to interview you, requesting records or when you find out that there is a pending investigation. I'm giving you my experience but remember that this is not a substitute for seeking your own legal advice but can help you understand the process. 


Rule #1: Do NOT take a board investigation lightly but at the same time do NOT panic. You have worked hard to get your license and most probably, your livelihood depends on your practice. Regardless of what you think the merit of the complaint, take it seriously and remember their job is to protect the public, and they can put you on probation, impose discipline on your license, fine you, etc. The board has a very complex and detailed protocol to follow in order to fulfill their mandate to protect the public. Have your attorney respond respectfully and professionally.

However, at the same time, everybody who has been in a profession long enough is going to be investigated. Talk to some people who have been through this before to get a healthy perspective. In other words, take it seriously but do not panic so that you make stupid mistakes. I have had too many cases where the client handled the board investigator interactions on their own for months and once they made numerous missteps, I was brought in to fix their mistakes.

Rule #2: Do NOT respond to a letter from the board unless you have consulted with an attorney. Even better, have the attorney respond to the board rather than you.

For example, I represented a Board certified Internist who was treating a patient covered by workers’ compensation insurance for high blood pressure only. The patient had numerous other health issues that were not addressed in the records. The doctor got her advice from other physicians and responded without realizing that her files were poorly documented, failed to show referrals to other specialists and failed to address the gaping problems with treating a patient in the workers’ compensation system who is not covered by any other insurance. I was brought in when the board decided to bring her in for an interview with a medical expert and a Deputy Attorney General. The board investigator was getting ready to recommend filing an Accusation. We became prepared for the meeting by having the doctor sign up for a medical record keeping class, sending a detailed letter addressing the issues in the workers’ compensation system where there was only authority to treat for one condition and how the doctor had changed her policies and procedures to handle documentation of referrals better in the future. Armed with these documents, the interview went well and once the doctor completed the PACE record keeping class, the case was closed. 


Everything you say is “evidence” or an “admission” and can be used against you in a Board proceeding or hearing. Having your attorney proffer this information is a way of getting around this. In some cases, the Board will specifically request that the letter come from you.  Supplemental information, however, can be submitted by the attorney.


One of my sayings is that the person with the biggest stack of papers wins. I like to show the Board that my client is professional and even if things were not handled perfectly, we have done everything to ensure that such an error will not happen in the future and therefore no discipline is needed. The Board gets my client’s CV, recent related continuing education certificates, letters of support, declarations under oath, expert witness report (if needed), etc. Every case is different and we are only limited by our imagination and creativity in finding ways to prove our case. 

Rule #3: Do NOT turn any material or records over to the board without getting legal advice first. While the board is likely to have a right to review the case material related to an investigation, the rules of evidence are quite complex and, at times, confusing. It is best if you let you attorney advise you about what to turn over to the board according to your state law. Indiscriminately turning records over to the board can result in additional or more serious charges than were originally intended by the board. In addition, you want to ensure that all privacy rights of any patients or clients are protected.

There are cases where auditors or certain inspectors (such as OSHA) are entitled to show up unannounced and request records. In those cases, contact an attorney so you make sure your rights are protected. There are ways to provide records without being interviewed until you have time to determine the status of the investigation and the nature of the complaint.  In addition, you want to ensure that you have a complete record of what has been produced.

Rule #4: Do NOT ever meet with the board investigator without legal representation. Meeting with an investigator without your attorney can be the single most professionally dangerous error you can make. It can cost you a clean license. Do not meet with a board investigator in person or talk to him/her on the phone without an attorney present, even if you are confident that you can positively respond to the complaint or accusation, and you think you can explain it away. The reason to have an attorney is that he/she can protect your rights to respond to certain questions so you do not unknowingly incriminate yourself. 


Most professionals do not know their rights or worry about looking "guilty" if they ask for an attorney and the truth of the matter is that they need an attorney to advise them.

In addition, if I as your lawyer tell the investigator what an amazing professional you are and give examples of what a good person you are, it is advocacy. If you say it, however, it is arrogance. Investigators generally cannot stand arrogance.

Rule #5: Do NOT ever discuss anything, without legal representation, with the board investigator if they unexpectedly show up at your office. It is common here in California for the investigator to show up without an advance appointment. Even if the investigator seems friendly, neither talk to them about the case nor release any records without legal representation. The nicer they are, they more you need to be wary since that is an investigative technique commonly used. The best investigators are like used car salesmen, they will come in your office, act chatty, put the feet up on your desk and hope you will say everything before you have had a chance to think about the case, review the records or speak to an attorney.


If an investigator unexpectedly shows up at your office or home, politely ask for their business card and tell them that your business attorney will contact them soon. Chatting "informally" with an investigator without your attorney present or turning records over to them can be the two most professionally dangerous errors you can make. Remember that you do not have a witness and you are not as well prepared as they are since they have been investigating the case. Do not allow them to pressure you to do anything right then and there. You have the right for legal representation and you should exercise it in a respectful way.

Rule #6: Do NOT assume that lack of harm to client or patient will end the board inquiry. You must understand that boards often focus on whether you violated any state laws or administrative or professional binding guidelines rather than whether your client was harmed by you or whether there was malpractice. While the element of damages is an essential element in a malpractice lawsuit, it is not a determining factor in a disciplinary action, except in relation to any penalty that may be assessed.

Rule #7: Do NOT be in a hurry. Often I have clients that want to get the investigation over so quickly that they insist on meeting the investigator and making assumptions about it too quickly.  I have had clients try to insist that I send letters before I have received a response from the State about any complaints – and later when we receive a letter about the nature of the complaint (in California under Bus. and Prof. Code Section 800(c)) they are glad I made them wait.  In most cases, time is your friend and use the time to help build your case and show the Board the facts. You want to meet deadlines but do not rush and make simple mistakes.


For example, when I say “don’t be in a hurry,” I also mean don’t be in a hurry in making decisions without legal counsel. One of my clients was visited by the DEA and was asked to surrender his DEA license. He was afraid and thought it would help an investigation go away, so he surrendered it and that caused a Medical Board investigation to be opened.

Rule #8: If you speak to investigators, do NOT lie or shade the truth. If you cannot tell the truth, do not speak. It is often a crime to lie to a federal or state agent.

For example, I had a client who ran a billing company charged with a federal felony of obstructing a federal audit which related to the audit of his client. Naturally, he did not consult an attorney before meeting with investigators from the Office of Inspector General (OIG) several times. 

Rule #9: If you are told that you have the “right to remain silent,” do not speak to investigators. This means that there is a criminal investigation. This is the time to exercise your constitutional right to the 5^th Amendment until you meet with an attorney.


Example, I had a client who was being investigated for dispensing IUDs that were from Canada and were not FDA approved. The doctor and his office manager confessed on the spot in the meeting. Did this help them? No. Criminal charges were filed. My other clients in similar cases who did not speak were never charged criminally for the same conduct since the authorities did not have a confession.

Rule #10: If you are asked to give a written statement, do NOT do so. The investigators will often write it out for you to “help” you or one of your employees. Take the time to meet with an attorney before you sign any document even if they tell you that you are not the suspect. It is amazing how many cases get started this way.


Your professional future, the value of a clean license and your rights are of critical importance to our firm.  We know what is at stake when licensees face a California governing body without the aid of an experienced attorney. How you initially respond to a state licensing board investigation or request for records may determine if you get sanctioned, lose your license, or lose your livelihood.


Posted by Tracy Green, Esq. 

Any questions or comments  should be directed to Tracy Green, a very experienced administrative law attorney, licensing attorney, and board and bureau investigations and hearing attorney.

If you have questions regarding your own case, please call 213-233-2260 or email Ms. Green at tgreen@greenassoc.com to schedule a complimentary 15-minute consultation.

What To Do When A Board Or Government Investigator Requests Records Or Comes To Your Office: What To Do And What NOT To Do - Part 1

If a board investigator from an administrative agency a criminal investigator contacts you or comes to your place of business or requests records in writing, the first step you need to take is contacting an attorney experienced in this area of the law. Tracy Green has given lectures to many professional associations indicating what an individual should do (and not do) when contacted by an investigator or when there is a request for records. Even a one or two hour consultation will help you prepare and not make critical mistakes that can harm you later.

A board representative may claim to have your best interests in mind and may tell you that “you don’t need an attorney.” Unfortunately, their job is not to protect your rights. They prefer to catch you off-guard before you have had time to prepare or think about the issues. For this reason, they do not usually make appointments. They just “show up” at your office.  In addition, they do not usually tape your interviews but have a second person there and they take down “notes” and create a report that is difficult to challenge later. 

It is much easier to be proactive and handle the cases properly from the beginning than to defend an Accusation or other proposed charges. Good beginnings make good ends.

Let's begin with general points to understand about the process. This is Part 1. Look for upcoming articles on this topic.

7 GENERAL POINTS TO UNDERSTAND 

ABOUT REQUEST FOR RECORDS OR INTERVIEWS

1.  The probability of getting a board complaint or being investigated by a state licensing board is increasing for several reasons. First, the longer you practice, the greater chance that you will receive a complaint. Second, there is greater political pressure on the boards and bureaus in California to be aggressive and harsher on the discipline. Third, common sources of complaints are patients/clients, competitors, insurance companies and disgruntled ex-employees. People are more inclined to complain in today's world especially since it is easy for them to find out how to do it on the Internet and the forms are downloadable. 

2.  It is important to know what is being investigated and the nature of the complaint(s) before there are interviews or responses to records are submitted. An experienced attorney knows how to find out this information in a professional manner that will make you look competent and responsible.

For example, I have had numerous cases where a new complaint reactivated an old complaint that my client did not even know existed because it was closed out at the intake level. This is why it is important to know what is being investigated before there are interviews or responses to records. This is also necessary so an overall defense strategy can be implemented. 

In one case, an OB-GYN was visited by a Medical Board investigator and asked to interview him about a patient who alleged a sexual touching. Investigator told him he didn't need an attorney. Sexual allegations are the MOST difficult to get rejects on if they get filed. OB-GYN called me and I spoke to the Board investigator, explained that I am his health care law attorney and I want to be present at the interview. Investigator told me "if it were me, I'd want an attorney present." Before the interview, I made reasonable demands to find out which patients were going to be at issue in the interview so we could ensure that proper releases had been signed and we could review the files beforehand. Turns out that in prior years there were two prior sexual touching complaints that had been closed out at the intake level but my client did not even know about them. All three complaints were completely false: one was complaining about a clitoral examination when the patient had elephantitis of the vagina and was at risk for tumors which was explained to her; another was complaining about having a woman with fibrous breasts sit up and lay down during the breast exam; and the other was equally absurd. Before the interview, all files were reviewed, a summary of each patient's treatment was provided, statements were obtained by staff from those that were present during the examinations, and the doctor was prepared to answer the questions without being offended, upset or too emotional. The investigator was also presented with the OB-GYN's policies and procedures for examining all women with a chaperone present. The case was closed after the interview and presentation of records. 

3.  If  you receive is a request for records or interview, it means that it has passed the intake process and a case has been opened.  That case will be either closed or it will be forwarded to the Attorney General's Office with a recommendation for filing disciplinary action. The GOAL is to get the case closed or to minimize the allegations that are forwarded to the Attorney General.  There is a range of cases ranging from meritless ones to questionable ones to difficult ones. Even with difficult cases, the goal is to have damage control and to determine how to achieve the best result possible even when the facts are not in my client's favor. The investigators have discretion and it may be that I need to help my client build good facts showing in various ways how my client is an outstanding professional

4.  The board or government representatives are NOT your friends. They are often very friendly and one of the biggest mistake my clients make is talking to them since they seemed "so nice" or because they were afraid of "making them mad." This is a very unsophisticated approach. Investigators are trained how to minimize in order to obtain more information. Just imagine that there is an Accusation filed and we are going to hearing, but you tell me "well, Tracy, I think the investigator liked me at the interview." There is a very easy way not to antagonize the investigator and have your attorney assert your rights. A good attorney knows how to make you look good while asking to be present at the interview. 

5. Be professional and respectful even while exercising all your rights. Now this does NOT mean that we fail to be aggressive in your defense but it means that we do not antagonize the investigator or Deputy Attorney General. As much as you want me to write a nasty letter threatening to sue the State, in the beginning I'll recommend instead a letter that focuses on the facts and why this investigation does not have merit. 


It means that we are very cordial -- respecting the power that they can wield over your license -- but we are strong and professional at the same time. The fact is that they know the details of the complaint and we know nothing. This means that we need to learn as much as the investigator to the extent possible before any interview. In addition, the investigator only knows one side of the investigation and we want to educate them as much as possible. I have gotten involved in cases after my client has threatened to sue the Board, the invetigator and that did not help their case. I am aggressive about defending my clients but smart about how to approach the Board and the investigators.  

6. Do NOT take investigations or requests for records lightly even if you are confidant that you did not do anything wrong. For example, assume there is a complaint by a former patient/client that you committed malpractice. The records are clear that there is no malpractice and, in fact, it was a good result. However, a review of the records shows that the recordkeeping is poor -- a surgical report is missing, the notes are skimpy, the handwriting is illegible and/or some other required information is not recorded. 

7.  The time to seek advice is before the records are produced or before there is any type of interview. It may be decided that a letter summarizing the treatment or client history is a good idea. It may also be decided with the help of the attorney that the missing record should be recreated but with a clear indication that the record was unexplainably missing and was recreated in order to give a complete record. Declarations or statements may be obtained from employees or other witnesses.

Some of my clients made serious missteps by backdating records or sending less than ideal records to the investigator without transcribing or summarizing them. Or they think that if the records are disorganized it will help them. To the contrary, if there are good facts, you want to make the job easier for the investigator and give him or her good reasons to close the case. Often the investigator may be sending the files to an expert witness and you want the expert to be able to read and understand the records, especially if there are good facts. A good summary from your attorney can help that process significantly. The advantage of the letter coming from the attorney is that it is not evidence from you.    

Your professional future, the value of a clean license and your rights are of critical importance to our firm.  We know what is at stake when licensees face a California governing body without the aid of an experienced attorney. How you initially respond to a state licensing board investigation or request for records may determine if you get sanctioned, get placed on probation, lose your license, or lose your livelihood. Now that all discipline is on the website, sanctions can adversely affect insurance plans, client/patient confidence and your reputation.


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 administrative law attorney, licensing attorney, and board and bureau investigations 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 providers and in administrative board and discipline matters in California and throughout the country. Their website is: http://www.greenassoc.com/

Los Angeles Clinic Owner/Manager Sentenced to 77 Months in Prison for Medicare Fraud With $18.9 In Alleged Losses

The sentences in health care fraud cases continue to be lengthy. On February 6, 2012,  a Los Angeles clinic owner/manager Eduard Aslanyan, 38, of Sherman Oaks, Calif., was sentenced by U.S. District Judge Consuelo B. Marshall in the Central District of California to 77 months in prison for establishing and running medical clinics which billed Medicare and in some cases used the stolen identities of physicians. The alleged billed amount was more than $18.9 million. Mr. Aslanyan was sentenced to three years of supervised release and was ordered to pay $10.8 million in restitution.

This sentence was after Mr. Aslanyan pleaded guilty in April 2011. If he had gone to trial and lost, he faced a lengthier sentence. He admitted that between March 2007 and September 2008, he established a series of fraudulent medical clinics in and around Los Angeles to defraud Medicare. His co-defendant, Carolyn Vasquez, who previously pleaded guilty to conspiring with Aslanyan to defraud Medicare, recruited physicians to serve as the medical directors of Mr. Aslanyan’s medical clinics. The physicians did not perform services at the clinics and were rarely present at the clinics. Physician assistants were hired by Mr. Aslanyan and Ms. Vasquez and were allegedly complicit in the fraud scheme at the clinics.

According to court documents, Mr. Aslanyan hired patient recruiters to find Medicare beneficiaries who were willing to provide the recruiters with their Medicare billing information in exchange for expensive, high-end power wheelchairs and other medical equipment which the patient recruiters told the beneficiaries they could receive for free. Often, the Medicare beneficiaries did not have a legitimate medical need for the power wheelchairs and equipment. 

The patient recruiters then provided the beneficiaries’ Medicare billing information to Mr. Aslanyan or brought the beneficiaries to Mr. Aslanyan’s clinics. Mr. Aslanyan paid the patient recruiters cash kickbacks in exchange for recruiting the Medicare beneficiaries.

In court documents, Mr. Aslanyan admitted that he and Ms. Vasquez instructed and paid physician assistants who worked at his clinics to prescribe medically unnecessary power wheelchairs, medical equipment and diagnostic tests for the Medicare beneficiaries. The physician assistants allegedly used stolen identities of physicians who did not supervise them or work at the clinics.

According to court documents, Mr. Aslanyan profited from the scheme at his fraudulent medical clinics in several ways. First, Mr. Aslanyan admitted that he allowed fraudulent diagnostic testing facilities to use the Medicare billing information he purchased from patient recruiters to submit false claims to Medicare for tests ordered at the clinics. In exchange, the fraudulent diagnostic testing facilities paid Mr. Aslanyan cash kickbacks that were disguised as rent payments to Mr. Aslanyan.

Second, Mr. Aslanyan also profited from the scheme by selling fraudulent prescriptions and documents generated at his clinics to the owners and operators of fraudulent durable medical equipment (DME) supply companies, which used the prescriptions and documents to submit false claims to Medicare. Mr. Aslanyan also used the fraudulent prescriptions and documents to submit false claims to Medicare through his own fraudulent DME supply companies, Vila Medical Supply Inc. and Blanc Medical Supplies.

Mr. Aslanyan received 70 months, a higher sentence than his co-defendant, since he has a criminal history and he had a higher restitution amount. Currently, Mr. Aslanyan is serving a three-year state sentence for assault. 

On Jan. 9, 2012, Judge Marshall sentenced his co-defendant Ms. Vasquez to 60 months in prison for her role in the fraud scheme and ordered her to pay more than $6.2 million in restitution to Medicare. 

A third co-defendant, David James Garrison, a physician assistant who worked at the fraudulent medical clinics with Ms. Vasquez and Mr. Aslanyan, is scheduled for trial on Feb. 7, 2012. Defendants are presumed innocent until proven guilty at trial. Mr. Garrison has a prior health care fraud conviction which could be complicating the case for him.  

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/