Tuesday, August 6, 2013

Owner of Rehabilitation Facility (CORF) Pleads Guilty To Mail Fraud For Submitting False Claims To Medicare

On June 21, 2013, an owner and chief executive officer of a comprehensive outpatient rehabilitation facility (CORF) pleaded guilty to mail fraud for submitting claims to Medicare for services that were not prescribed by treating doctors. This case had been pending for over two years since the Indictment was filed in March 2011.

This case involves Medicare billings by Fountain Valley Healthcare Center (FVHC), a CORF that Tuan Duc Tran owned and operated since 2001. Mr. Tran admitted that he submitted bills to Medicare based on false claims that Medicare beneficiaries had been referred to FVHC by a physician for physical and respiratory therapy. Mr. Tran admitted that the names of the referring physicians were falsely identified. In order for medical necessity to exist, the patients must be referred by a treating physician and these claims for payment violated Medicare rules because the treating doctors had not referred the beneficiaries for rehabilitation.

Under the plea agreement, Mr. Tran will be required to pay $777,291 in restitution to Medicare. Even though the services were provided, the entire amount collected is to be treated as a loss amount and required to be repaid as restitution. 

U.S. District Judge Josephine Staton Tucker scheduled Mr. Tran’s sentencing for November 8. The mail fraud count carries a maximum statutory sentence of 20 years in federal prison. However, under the plea agreement, Mr. Tran will be at an offense level 16 in the federal sentencing guidelines with a guideline sentencing range of 21 to 27 months although the parties can argue for a sentence outside the guideline range and Judge Tucker is not bound by the parties' agreement in the signed plea agreement.

Attorney Commentary: These health care fraud cases are often difficult for those charged to understand where the services have been provided and were even of benefit to the patients. In this case, part of the government's offer of proof was that Mr. Tran had agreed to be familiar with the Medicare rules and regulations and to comply with them. In his case, the fact that the physician names listed on the superbills were not the patients' referring physicians was one of the facts that shifted this case from a billing error case to a fraud case.

Posted by Tracy Green, an attorney specializing in representing and defending health care professionals in health care fraud, Medicare fraud and Medi-Cal fraud allegations, audits, investigations and charges. Email: tgreen@greenassoc.com  Office: 213-233-2260


DISCLAIMER: Green & Associates' articles and blog postings are prepared as a service to the public and are not intended to grant rights or impose obligations. Nothing in this website should be construed as legal advice. Green & Associates' articles and blog postings may contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations, and other interpretive materials for a full and accurate statement of their contents and contact their attorney for legal advice. The primary purpose of this website is not the commercial advertisement or promotion of a commercial product or service and this website is not an advertisement or solicitation. Anyone viewing this web site in a state where the web site fails to comply with all laws and ethical rules of that state, should disregard this web site.

The information provided on this website is for informational purposes only. It is not intended to create, and does not create, a lawyer-client relationship with Green & Associates, Attorneys at Law. Sending an e-mail to Tracy Green does not contractually obligate them to represent you as your lawyer, or create any type of client relationship. No attorney-client relationship will be formed absent a written engagement or retainer letter agreement signed by both Green & Associates and client and which specifies the scope of the engagement.

Please note that e-mail transmission is not secure unless it is encrypted. E-mail messages sent to Ms. Green should not include confidential or sensitive information.