Thursday, August 21, 2008

CEO Magazine reports healthcare costs are within the top three business concerns....

ACFE Healthcare Fraud Seminar

Posted On: August 19, 2008 by Robert David Malove

CEO Magazine reports that healthcare costs are within the top three business concerns, and for good reason: U.S. healthcare spending has increased from a mere $27 billion in 1960 to $2 trillion in 2005. That is a 7,100 percent increase in spending! Employers today face many unique regulations, systems, procedures and records, with the potential for fraudulent activity at a heightened level.

Fraud fighters need an improved understanding of these staggering numbers and the types of healthcare fraud that may occur. This two-day, instructor-led course is designed for anti-fraud and audit professionals who work in the payer, provider, vendor and employer benefit areas or advise clients who operate within the healthcare continuum.

Get the targeted training you need to keep up with the latest fraud schemes and related laws affecting this highly complex profession.

For more info, please visit

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Medicare instructed AdvanceMed to disregard those policies

"...officials at Medicare instructed AdvanceMed to disregard those policies...'

WOW! is this suppose to be a surprise?
What do you want from the Secretary of DHHS, who comes from the "FAMILY OWNED" LARGEST INSURANCE BROKER in the STATE of UTAH?
THE LEAVITT GROUPReport Rejects Medicare Boast of Paring Fraud
Published: August 20, 2008

Medicare’s top officials said in 2006 that they had reduced the number of fraudulent and improper claims paid by the agency, keeping billions of dollars out of the hands of people trying to game the system.

But according to a confidential draft of a federal inspector general’s report, those claims of success, which earned Medicare wide praise from lawmakers, were misleading.

In calculating the agency’s rate of improper payments, Medicare officials told outside auditors to ignore government policies that would have accurately measured fraud, according to the report. For example, auditors were told not to compare invoices from salespeople against doctors’ records, as required by law, to make sure that medical equipment went to actual patients.

As a result, Medicare did not detect that more than one-third of spending for wheelchairs, oxygen supplies and other medical equipment in its 2006 fiscal year was improper, according to the report. Based on data in other Medicare reports, that would be about $2.8 billion in improper spending.

That same year, Medicare officials told Congress that they had succeeded in driving down the cost of fraud in medical equipment to $700 million.

Some lawmakers and Congressional staff members say the irregularities that the inspector general found were tantamount to corruption and raise broader questions about the credibility of other Medicare figures.

“This is outrageous,” said Senator Charles E. Grassley of Iowa, the top-ranking Republican on the Senate Finance Committee, who has repeatedly credited the Centers for Medicare and Medicaid Services with reducing improper expenditures. “If heads don’t roll, you can’t change the culture of this organization,” he added.

Senator Grassley had not yet received the full report from the inspector general but had been briefed on its contents.

The report — a draft of which was obtained by The New York Times — will probably be made public within the next week, according to federal officials. The inspector general may change or edit the findings of the report before it is officially released. Congressional staff said the Centers for Medicare and Medicaid Services — the agency overseeing Medicare — was lobbying the inspector to play down the report’s conclusions.

A spokesman for Medicare said that the agency agreed with the inspector general that the agency’s reported level of improper billing for durable medical equipment, or D.M.E., should have been higher. But Medicare says the $2.8 billion figure is unsupported.

“Allegations of manipulation of this error rate are preposterous,” said the spokesman, Jeff Nelligan. “The agency has aggressively targeted fraud and improper payments in the D.M.E. program. We have a history of working closely with the inspector general and will continue to do so.”

A representative of the Office of Inspector General that created the report — part of Medicare’s parent, the Department of Health and Human Services — said it did not comment on draft reports.

Fraudulent and improper payments have long bedeviled Medicare, a $466 billion program. In particular, payments for durable medical equipment, like power wheelchairs and diabetic test kits, are ripe for fraud.

Equipment sellers have submitted counterfeit documents, forged doctors’ signatures and filed claims on behalf of patients who were dead or had never been seen by the prescribing physician, according to many reports by government oversight agencies.

For example, a Florida businessman was sentenced last year to 37 months in prison for submitting more than $5.5 million of fake claims to Medicare. The businessman operated for months, despite giving the agency an address that was actually a utility closet.

On July 1, Medicare instituted a new competitive bidding system that officials said would reduce both fraud and costs for medical equipment.

On July 15, however, Congress suspended the program, after equipment manufacturers and sellers began an aggressive lobbying campaign.

Senator Grassley said Congress might push for an investigation into the private company that was hired to fulfill Medicare’s auditing program, the AdvanceMed Corporation, a division of the Computer Sciences Corporation. The report mentions AdvanceMed by name.

Representatives of AdvanceMed did not return calls. The company has received contracts worth more than $34 million from the Centers for Medicare and Medicaid Services since 2005.

“This report doesn’t surprise me,” said Representative Pete Stark, Democrat of California and a senior member of the Ways and Means Committee. He has pushed to cut improper Medicare spending. “To look better to the public, you cook the books,” he said. “This agency is incompetent.”

The Office of Inspector General’s report details scrutiny of a program known as Comprehensive Error Rate Testing, or CERT, that audits a sample of Medicare claims submitted by sellers of durable medical equipment. That program is supposed to randomly choose claims and review the medical records and other documents supporting submitted claims to determine whether payment is justified.

According to the inspector general’s report, officials at Medicare instructed AdvanceMed to disregard those policies. Instead, AdvanceMed was told to examine only the documents submitted by the companies selling the medical equipment, rather than verify those documents against physicians’ records.

Medicare reported to Congress that, for the fiscal year of 2006, AdvanceMed’s investigations had found that only 7.5 percent of claims paid by Medicare were not supported by appropriate documentation. But the inspector general’s review indicated that the actual error rate was closer to 31.5 percent.
For instance, according to the report, the Office of Inspector General examined a claim for an electric wheelchair that AdvanceMed had said was appropriate. The inspector general’s investigation revealed that the physician who was listed as having prescribed the wheelchair had no knowledge of the prescription.

The person who received the wheelchair said that he had never met with the physician, that he did not need a wheelchair and that he had never used it, according to the report. His wife had also received a wheelchair that she had not asked for and never used.

Equipment sellers can pocket more than $2,500 every time they send a powered wheelchair to a patient and bill Medicare.

“This is like letting the fox guard the henhouse,” said Malcolm Sparrow, a Harvard University professor who focuses on health care fraud. “The supplier has an incentive to supply fabricated documents or to imply that medical records support a purchase when they don’t. If you don’t ask the physician or ask for medical records, you can’t really verify anything.”

Tuesday, August 19, 2008

Indianapolis day care defrauded the Indiana Medicaid Program of nearly $2 million.

INDIANAPOLIS -- A woman who ran an Indianapolis day care has been indicted on federal charges she defrauded the Indiana Medicaid Program of nearly $2 million.

Carol Y. Woodard, 40, was indicted Monday on health care fraud charges, said U.S. Attorney Timothy Morrison.

Woodard enrolled her day care and after-school care business, Gideon's Gate, in the Medicaid program and collected $1.8 million for services never rendered, including therapy for traumatic brain injury, Morrison said Woodard was not in federal custody Monday. A telephone call to a number listed in Woodard's name was not answered Monday evening.

Woodard faces up to 10 years in prison and a $250,000 fine. An initial hearing before a federal magistrate is scheduled for Sept. 2.

Copyright 2008 by The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Friday, August 15, 2008

Why do Fraudulent Providers still exist ? Becasue they can?

Our Government and Lobbyists & FInancial Investment Firms at work, once again!!
That is the real answer. But maybe, for starters, we need to connect dots to the BIG POLICY MAKERS and their connection to FRAUD,i.e. Frist, Bush, Rainwater & Moore!

Go to the NCFE trial in Dublin, Ohio that DOJ would like to behave as this case is over, while the Co-Founder and a 3uear EXECUTIVE, James K Happ, has yet to go to trial? Now , you ask how this is connected........??????

Now wwhy do you think this is?"...states submitted incomplete data or reported not taking any action against health care providers in 2004 and 2005."

"...In violation of federal law, states routinely fail to notify federal authorities when they've kicked health care providers out of their Medicaid programs for incompetence, fraud and other reasons,..."

"...61 percent of the 4,319 sanctions imposed by state Medicaid agencies in 2004 and 2005 could not be found in the federal database."

"...two states that suspended the largest number of providers, New York and Florida, had the lowest matching rates,21 percent and 9 percent respectively."

WASHINGTON — In violation of federal law, states routinely fail to notify federal authorities when they've kicked health care providers out of their Medicaid programs for incompetence, fraud and other reasons, government investigators have found.

The lack of notice makes it easier for barred providers to set up shop in other states and to continue getting payments from federal health programs.

The inspector general for the Health and Human Services Department maintains the list of health care providers prohibited from getting any federal health reimbursements. Last year, the IG's office added 3,308 people and organizations to that database, but probably could have added many more, according to a survey that investigators conducted recently.

Investigators surveyed the states to find out how often their Medicaid programs sanction a provider in a way that would in the vast majority of cases merit a spot in the IG's exclusion database. An astounding 61 percent of the 4,319 sanctions imposed by state Medicaid agencies in 2004 and 2005 could not be found in the federal database.
States with high match rates tended to be states that took action against more than 100 health care providers, though that wasn't always the case. Alabama, Louisiana and Texas had the highest match rates. More than 80 percent of the providers suspended from their state Medicaid programs could be found on the national list.
However, the two states that suspended the largest number of providers, New York and Florida, had the lowest matching rates, 21 percent and 9 percent respectively.

About a dozen states submitted incomplete data or reported not taking any action against health care providers in 2004 and 2005. Among them were California and Michigan, two states with large Medicaid populations.

Jeff Nelligan, a spokesman for the Centers for Medicare and Medicaid Services, said the agency agrees there's room to increase the number of referrals from the states. It will "strive to reduce the barriers that may currently exist," he added.

In all, 47 states responded to the survey. State officials frequently said they were unclear about what kind of information was supposed to be forwarded to the HHS inspector general.

"It would be handy to have a little cheat sheet that clearly stated refer these cases with this info," an unidentified state official wrote.

Another state official wrote that until they had responded to the inspector general's survey, "no coordinated effort existed ... to make referrals."

Reasons for exclusion from federal health programs include convictions for fraud and patient abuse, licensing board sanctions and default on federal health education loans. Under law, no federal payment can be made for anything that an excluded person furnishes, orders or prescribes.

US Rep. Ileana Ros-Lehtinen rejects Medicare fraud remedy....

You wonder why?
"...fraud seems to be a major industry in South Florida..."
"...billions of dollars defrauded from Medicare...."
"...Ros-Lehtinen has banked $180,000 from Big Pharma and HMOs."

JUST LOOK AT THE TRIAL, dubbed by Fed Prosecutors as Largest Private Fraud Case in the history of America:

Poulsen was president, chairman, chief executive officer and an owner of Dublin, Ohio-based NCFE, one of the largest healthcare finance companies in the United States until it filed for bankruptcy in November 2002.

After the witness tampering indictment was returned, Poulsen’s fraud trial was severed from the other NCFE defendants. Poulsen will face the fraud charges at trial scheduled to begin Oct. 1, 2008. Demmler's sentencing date has not yet been set. Both men have been in custody since their arrests.

The case is being prosecuted by Assistant U.S. Attorney Doug Squires and Trial Attorneys Leo Wise and Nathan Dimock of the Criminal Division’s Fraud Section. The case was investigated by the FBI.

Go to:

Tuesday, August 12, 2008
US Rep. Ileana Ros-Lehtinen rejects Medicare fraud remedy
The Miami Herald is outdoing itself lately with investigations. As the staff shrinks, will the good work still have a chance to continue? The answer will have telling effect on our civic culture, and on the jail population. Fewer crooks will be incarcerated if the Herald isn’t able to keep on exposing fraud.

In fact, fraud seems to be a major industry in South Florida. Look at two of our most important economic sectors:

· Real estate. Mortgage fraud on all sides has been exposed in the Herald as a reason for the steep rise of home prices a few years ago and now the drop. This was accomplished by our neighbors the bankers, mortgage brokers, borrowers and lenders. Working together and individually to get rich like good Americans or just to be housed, they came close to wrecking the whole national economy. Rampant was the word the Herald used to characterize the level of mortgage fraud.

· Health care. Now the Herald has chronicled billions of dollars defrauded from Medicare – that’s from our pockets, fellow citizens – by our neighbors, the fraudsters. This was billions annually in South Florida, not the whole country. An incredible haul. Perhaps it explains the big houses and fancy yachts in our splendid part of the land.

And what is the remedy? Congress! At least in the case of Medicare fraud. So it says on the front page of Monday’s Herald. Headline: Fraud Remedy Denied.

Headlines often are written in the passive voice without full verb forms. Let’s do a little exercise here and put this in the active voice. Congress Denied Fraud Remedy.

As the Herald’s Jay Weaver reported exhaustively, the Medicare agency tried repeatedly for more money to combat fraud, and Congress always throttled the attempt. Weaver shows fine enterprise in interviewing two local members of Congress to delve into the reasons.

Interestingly, Republican Sen. Mel Martinez is on the good side (first-termer behavior?) of this issue, and is backing legislation to stop fraud. He says $1 invested in anti-fraud measures will yield $10 in fraud-reduction, the Herald reports.

Then Weaver turns to my congresswoman, Rep. Ileana Ros-Lehtinen, FL-18, in the U.S. House since 1989, and she speaks out of both sides of her Republican mouth. Medicare needs help to fight fraud, but it’s risky for lawmakers to give money to an agency recognized for incompetence, she says:

“If you increase the money for oversight, then it looks like you’re fattening up the bureaucracy, even when it’s really for oversight and fighting fraud,” she said. “It’s a difficult choice.”

She then chose according to the ideology of small-government-is-best, and voted against it.

Perhaps it’s not ideology. Campaign donations could be another motivation. And thanks to research from the Florida Democratic Party, we have some detail on Ros-Lehtinen’s connection to Medicare fraud via past donations for her re-election.

From an FDP news release last week:

“In 1998, the largest home health care provider in South Florida was charged with bilking Medicare for more than $45 million in fake services. The company's founder had been a donor to Ileana Ros-Lehtinen's campaign for re-election to Congress.

“Congress did have the opportunity to fight back against Medicare fraud before it reached crisis proportions, but Ros-Lehtinen voted against allowing Congress to pursue its Constitutionally-mandated oversight role. In 1995, she voted for the so-called Medicare Preservation Act (HR 2421, Roll Call 731, 1995). The Act that Ros-Lehtinen voted for "crippled the efforts of law enforcement agencies to control health-care fraud abuse in the Medicare program," according to the then-inspector general of the Department of Health and Human Services.

“Even then, Ros-Lehtinen voted with the Republican Party line and against the best interest of the people of her district, a pattern that continues almost 15 years later.”

The FDP release reports that Ros-Lehtinen has banked $180,000 from Big Pharma and HMOs.
The charge:

“Ros-Lehtinen is either complicit or easily bamboozled, but any way you cut it she has no business representing South Florida in the United States Congress,” said Eric Jotkoff, FDP spokesman.

Corporate billing fraud and abuse costs over $200 billion a year.

Health Care Politics by Ralph Nader
Posted on August 14, 2008 by dandelionsalad
Dandelion Salad

by Ralph Nader
Aug. 14, 2008

One of my favorite monthly publications is Registered Nurse – the journal of the fast growing, progressive California Nurses Association (CNA) – a union that stands up for patients rights and well-being.

The June 2008 issue contains stories that illustrate how this nurses group takes stands. On June 19, the CNA sponsored street rallies for its Medicare for all (single-payer with free choice of doctor and hospital) in San Francisco and a dozen other major cities around the nation.

For over a decade these nurses have made full Medicare for all their major goal. They have run voter initiatives, lobbied legislatures and have opposed sweetheart labor-management deals like those embraced by the Service Employees International Union – SEIU. (SEIU also opposes single-payer health insurance which is supported by a majority of physicians and the American people.)

The June magazine describers the autocratic native of SEIU toward its members and how its leader, Andy Stern, cuts labor deals with large corporate employers that shockingly deprive workers of normal union rights.

Here is an example of what CNA says:

“In exchange for access to more dues units, SEIU gave California nursing home operators the “exclusive right” to set all pay rates, working conditions, speed up and reassign work, eliminate jobs at will, and outsource union work.”

“SEIU also agreed to support legislation limiting patient’s right to sue over care abuses, to oppose reforms to require better staffing for patients safety, and to never report health care code violations.”

Stern rejected single-payer health insurance at his recent union convention. Senator Barack Obama has declined to propose single-payer as well. SEIU is pouring tens of millions of dollars to elect Senator Obama President. CNA works to eliminate “the insurance nightmare through establishing a high-quality, single payer healthcare system. (See:

The current health care industry is a wasteful, redundant, defrauding mess costing Americans over 2.2 trillion this year and hundreds of thousands of avoidable injuries, fatalities and serious infections a year. The honest, competent caregivers are on the edge of despair, unable to do their best work due to the domination and control of commercial-profit priorities which include denial of care by these corporations.

People die or get sicker sometimes when they are denied health care. People die when they cannot afford health insurance – 18,000 Americans a year according to the Institute of Medicine

Corporate billing fraud and abuse costs over $200 billion a year. Ask Malcolm Sparrow of the Kennedy School at Harvard University or read his book License to Steal.

Do you ever hear John McCain or Barack Obama focus public attention on these tragedies and rip-offs of consumers and taxpayers?
The employers of health insurance companies, hospital chains and drug industry are pouring money into the coffers of these two men and their parties.

Strange as it many seem, on June 26, 2008 even the principled, independent California Nurses Association fell in line with the AFL-CIO. The CNA endorsed Senator Barack Obama.

Well, Senator Obama doesn’t have to worry a minute about CNA’s nurses putting up one of their famous critical demonstrations at his events. He can continue dialing for corporate dollars.

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FAIR USE NOTICE: This blog may contain copyrighted material. Such material is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues, etc. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.


The Mother Of All Paradoxes: The American Social Model

Single-Payer Universal Health Care Advocates at Annapolis Event

Health Care

"...The CIA between Amerigroup and its subsidiary health plans " Who is the Subsidiary?

"...lawsuit against Amerigroup was originally filed by Cleveland Tyson, a former company employee."

"...avoided enrolling unhealthy patients.."

"...October 2006, a jury found Amerigroup liable..."

"...court entered a $334 million judgment against Amerigroup, which then filed an appeal with the U.S. Court of Appeals for the Seventh Circuit in Chicago seeking a reversal of the judgment. As part of the settlement, Amerigroup will dismiss its appeal and has agreed to enter into a Corporate Integrity Agreement (CIA) with the Office of Inspector General for the U.S. Department of Health and Human Services (HHS)."

My question is WHY is Amerigroup or ANY ONE OF ITS SUBSIDIARIES still allowed to conduct ANY BUSINESS in our Healthcare System?

"...CIA between Amerigroup and its subsidiary health plans and the Office of Inspector General requires the company to adopt policies and procedures, and a code of conduct designed to prevent improper discrimination against federal health care program beneficiaries in its marketing and enrollment practices. The CIA applies to Amerigroup's managed care plans in all the states – currently 11 – in which the company does business during the term of the agreement. In addition, Amerigroup must hire an independent organization to annually review its marketing practices and enrollment initiatives, and its board of directors must certify the effectiveness of its compliance program each year."

Thursday, August 14, 2008
Amerigroup Settles Federal & State Medicaid Fraud Claims for $225 Million WASHINGTON – Amerigroup Corporation has agreed to pay $225 million to resolve claims that it defrauded the Illinois Medicaid program, the Justice Department and the Attorney General of Illinois announced today. Amerigroup, which is headquartered in Virginia Beach, Va., operates managed health care plans throughout the United States.

Today’s settlement resolves allegations that Amerigroup and its Illinois subsidiary systematically avoided enrolling pregnant women, and unhealthy patients in their managed care program in Illinois. Amerigroup was paid by the United States and the state to operate a Medicaid managed care health plan in Illinois to provide health care to low income people. Amerigroup was required by law to enroll all eligible beneficiaries. The United States and the state of Illinois brought claims against the company alleging that it violated this requirement and avoided enrolling unhealthy patients, as well as pregnant women, who were more costly to treat and would have eroded Amerigroup’s profit margin.

In October 2006, a jury found Amerigroup liable under the federal False Claims Act and the Illinois Whistleblower Reward and Protection Act. The court entered a $334 million judgment against Amerigroup, which then filed an appeal with the U.S. Court of Appeals for the Seventh Circuit in Chicago seeking a reversal of the judgment. As part of the settlement, Amerigroup will dismiss its appeal and has agreed to enter into a Corporate Integrity Agreement (CIA) with the Office of Inspector General for the U.S. Department of Health and Human Services (HHS).
"The Justice Department is committed to ensuring that recipients of federal health care funds adhere to the law, so that appropriate health care services are provided to all eligible patients," said Gregory G. Katsas, Assistant Attorney General for the Civil Division.

"A settlement of this magnitude sends the clear message that this office takes health care fraud very seriously," said Patrick J. Fitzgerald, U.S. Attorney for the Northern District of Illinois. "This case also illustrates the perils a defendant faces in taking a case such as this to trial."

"This settlement should send a clear message that the state of Illinois will not tolerate illegal conduct in the provision of healthcare for Illinoisans," said Illinois Attorney General Lisa Madigan. "I am pleased that our work on this case will bring millions of dollars to the State of Illinois."

The CIA between Amerigroup and its subsidiary health plans and the Office of Inspector General requires the company to adopt policies and procedures, and a code of conduct designed to prevent improper discrimination against federal health care program beneficiaries in its marketing and enrollment practices. The CIA applies to Amerigroup's managed care plans in all the states – currently 11 – in which the company does business during the term of the agreement. In addition, Amerigroup must hire an independent organization to annually review its marketing practices and enrollment initiatives, and its board of directors must certify the effectiveness of its compliance program each year.
"The Office of Inspector General is committed to protecting Medicaid beneficiaries from fraud and discrimination" said HHS Inspector General Daniel R. Levinson. "This Corporate Integrity Agreement will help ensure that our most vulnerable beneficiaries have access to needed Medicaid HMO plans in the future."

The lawsuit against Amerigroup was originally filed by Cleveland Tyson, a former company employee. Under the federal False Claims Act and the Illinois Whistleblower Reward and Protection Act, a private party, known as a relator, is entitled to file suit alleging fraud on behalf of the federal or state government, respectively, and receive a share of any recovery. As a result of today’s recovery, Tyson will receive $56.25 million.

The case was handled by the U.S. Attorney’s Office for the Northern District of Illinois and the Illinois State Attorney General’s Office, with assistance from the Justice Department’s Civil Division and the Office of Inspector General for HHS, as well as by private counsel for the relator.

Wednesday, August 13, 2008

Healthcare & Investment Firms......Canyou connect this one?

Below is an exerpt posted in this week's Newsweek :
The Pickens Profile You Haven't Read

Pickens likes to portray his years as a corporate buccaneer during the 1980s as "shareholder activism." When Mesa fell into a cash crisis in the mid '90s after the price of natural gas collapsed, there was no mercy for him on Wall Street. Pickens called in Texas financier Richard Rainwater, and his wife and business partner, Darla Moore, to help raise capital. (Rainwater helped another oilman, George W. Bush, escape his money problems by making him co-owner of the Texas Rangers, a deal that eventually made Bush a multimillionaire.)

Moore, a leveraged-buyout specialist dubbed "the Toughest Babe in the Business" by Fortune, tried to raise $1 billion on Wall Street for Mesa. "I found out there wasn't a bank in the country that would touch the deal if Boone was CEO," Moore told NEWSWEEK. "I tried to soften the message [but] he was really surprised. 'But I get along with all those guys,' is what he said." The Rainwaters worked out a deal for Pickens to retire as CEO, and bought him out, a deal that still rankles the billionaire. Moore whooped with surprise when told by a NEWSWEEK reporter that Pickens had compared her in his book to a "wolverine that pisses on everything it doesn't eat." Moore responds, "I think what people don't know about Boone is that deep down he is actually—I hate to say this—a nice man. And he knows more about energy than anybody in the world."

Just a little insight to Darla Moore;
Darla Moore In 1981, at Chemical Bank in New York, Moore and Conway were focused on a new idea: loaning money to corporations
teetering on the brink of bankruptcy,
Soon after, she met and married Rainwater, who made her president of his investment company. They now had $500 million to put wherever they wanted.That's when she pushed T. Boone Pickens out . . . and then to a hard look at Rick Scott.

Scott was Rainwater's good friend. They had bought two hospitals in Texas and shared a vision: a nationwide chain of hospitals using cost controls.

By 1997, Scott's company, Columbia/HCA, was the nation's largest managed care provider.
But Moore said Scott was unwise to ignore subordinates who questioned his practices and foolish to dismiss a federal investigation of how Columbia billed Medicare.

According to the SEC Form :
Med Diversified Inc.
Annual Meeting Of Stockholders
September 9, 2003

JAMES K. HAPP has served as chief executive officer of our subsidiary, Tender Loving Care Health Care Services, Inc., since October 2002.

Previously, Mr. Happ served for three years as executive vice president of NCFE, during which time he restructured the servicer department to improve operational performance and accelerated the utilization of technology to increase operational efficiency. (1999-2002 by deduction of SEC statement)

Mr. Happ also served as chief financial officer of the Dallas-based Columbia Homecare Group, Inc., a home care company with more than 500 locations nationwide and more than $1 billion in revenue in 1997. In this role, he directed the company through the challenging reimbursement climate, known as the interim payment system, and participated in the divestiture of all of Columbia/HCA's home care operations (At least1997 until 1999)

Participated in the "DIVESTITURE"...Where did this divestiture 'divest' to?

Thursday, August 7, 2008

Long Term Insurance Fraud; How To Avoid It

August 6, 2008
Long Term Insurance Fraud: How To Avoid It

by Terry Stanfield
We do not live in a perfect world and the risk of fraud exists. It may be a fraud through a company offering you products, or it may be fraud through con artists, but the sad truth is it exists. Long-term care insurance is not exempt from the risk of fraud, and there are those out there who will try and benefit off your misfortune and leave you with nothing. One of the important things you can learn from the mistakes of others is how to avoid being a victim of insurance fraud.

Obviously, the first thing anyone should consider when they are thinking of getting long-term care insurance is research. Researching a company is one of the best ways to prevent long-term insurance fraud. When you look at the record of a company, you will be given a clear indication of how they will treat you and your money.

You should look into the financial rating of a company to determine how legit it is, and how stable it is. Standard & Poor determines the strength of insurance companies, as well as giving detailed financial profiles on thousands of insurance companies. You can also look at Fitch Ratings, which give financial strength ratings for many insurance companies.

When you decide on a long-term care insurance policy, make sure you get the policy when you meet with the insurance broker. Do not fall for the line of 'It is all in the brochure.' Usually, it is not. You should be able to get the policy, in writing, when you meet with the broker and before you sign it, make sure you read it very carefully, even if you have to take it home to do so.

When you get a policy, you are asked for a month's premium up front to process the application. If you choose not to accept the policy or you are declined, you should get your money back in full.

You can also talk to friends of yours to find out what insurance company they go through for their own long-term care insurance policies, if they do. However, do not accept their word because they could be victims of long-term insurance fraud and not even know it yet. Just research the company and if you find out something troubling, let them know. Conclusion Long-term care insurance is one of the best things you can do to make sure you are not a financial burden on your family. However, you do not want to give someone your money and find out later that you were a victim of fraud. Then, with all the money you put in, you come up with nothing and that is a horrible situation to be in. Do your research, ask questions, don't sign anything without reading it and always make clear what you expect up front. If you do this, you should be okay and be able to prevent yourself from becoming a victim of long-term care insurance fraud. You should just ask for help from an insurance representative who specializes in long term care insurance to answer any questions.

Medicaid Paid $373,810.65 .......

A Dallas woman, Rebecca Swanson, who owned and operated a drug and alcohol counseling service in Dallas, pled guilty in federal court to health care fraud and aiding and abetting. Swanson faces a maximum statutory sentence of 10 years in prison, a $250,000 fine and restitution arising from all relevant conduct.

A federal grand jury indicted Swanson, in February on one count of conspiracy to commit health care fraud and four counts of health care fraud, and a warrant was issued for her arrest. In May she was arrested and she has been in federal custody since that time.

From April 2001 to August 2003, Swanson owned and operated Life Share Therapy Foundation (LSTF), a counseling services business located first in Dallas and then later in Lancaster, Texas. She made financial decisions for the business and controlled LSTF’s bank account. In May 2001 LSTF was granted a Texas Medicaid provider number was approved by Medicaid to render counseling services through a Medicaid program known as School Health and Related Services (SHARS). Services available under SHARS included counseling for children who had suffered emotional, psychological, or other forms of abuse. Medicaid reimbursed providers of such counseling a preset rate for each 15-minute segment of counseling services rendered.

From May 2001 through August 2003, Swanson, using LSTF’s Medicaid provider number, executed a scheme to defraud Texas Medicaid by submitting fraudulent claims falsely representing that LSTF had provided individual counseling services through SHARS to Medicaid clients, when in fact, they had not. Swanson’s fraudulent claims also falsely represented that the Medicaid clients for whom the claims were submitted had suffered child abuse, emotional abuse or psychological abuse. Each bogus claim submitted by Swanson sought reimbursement for multiple 15-minute segment counseling sessions, falsely representing that the duration of each session had been no less than one hour and as long as two hours.

Rebecca Swanson admitted that a result of the fraudulent claims she submitted through LSTF, Medicaid paid a total of $373,810.65 to LSTF. Swanson admits using these funds for her own personal use.

The 21-count indictment, which was unsealed Wednesday, charged them with conspiring to receive and take kickbacks for patient referrals and to commit

FBI Raids Hospitals, Arrests CEO

Previous posts on Health Care Renewal have featured a rogues gallery of disgraced leaders of health care organizations. For example, we recently discussed a former hospital CEO who concealed that he had served time in the US Navy's brig. The Los Angeles Times just reported a story that suggests a new low in hospital leadership,

FBI agents served search warrants this morning on three hospitals as part of an investigation into alleged Medicare fraud involving homeless patients who were recruited from skid row.

Dr. Rudra Sabaratnam, an owner and the chief executive of City of Angels Medical Center, and Estill Mitts, an alleged patient recruiter, were indicted by a federal grand jury last week on 21 counts of healthcare fraud, money laundering and income tax evasion.

The men were arrested this morning as part of the federal government's criminal investigation, according to FBI spokeswoman Laura Eimiller.

''It's a scheme that ranged from street operatives to the CEO of a hospital,' said U.S. Atty. Thomas P. O'Brien, adding that he expects several more arrests in coming weeks.

At the same time, Los Angeles City Atty. Rocky Delgadillo announced civil litigation against the three hospitals and their operators in what officials said was a 'scheme to defraud the Medi-Cal and Medicare programs out of millions of dollars.'

Beginning at 8 a.m., agents working with the federal Department of Health and Human Services, the Internal Revenue Service and the California Department of Justice raided City of Angels Medical Center, Los Angeles Metropolitan Medical Center and Tustin Hospital and Medical Center.

The raids cap what law enforcement sources told The Times was a nearly two-year investigation of alleged medical fraud on skid row.

The city attorney's office alleged that the hospitals tried to fill empty beds in a bid to boost their finances.

The hospitals allegedly were aided by a patient recruiting operation on skid row that plucked homeless people from the streets and delivered them with fake medical conditions to the hospitals.

Metropolitan Medical Center in 2006 was accused by the Los Angeles Police Department of using ambulances to 'dump' five patients in one day onto the streets of the downtown skid row area against their will after their discharge from the hospital. At the time, officials at the hospital strongly denied any wrongdoing.

But the city attorney now alleges that those patients had been recruited 'by runners' who directed them to an assessment center on 7th Street, where their Medicare and Medi-Cal benefits eligibility was checked and a 'fabricated description of conditions' was prepared by non-doctors so they could be eligible for treatment. All five of the patients were admitted to Metropolitan Medical Center.

Each of the patients received $20 to $30 when they returned to the assessment center after spending one to three days in the hospital, according to the suit.

'Within the past four years, hundreds, if not thousands of other homeless persons in skid row have been recruited, hospitalized, treated and discharged in a manner substantially similar . . . as part of a long-running scheme to bilk the Medicare and Medi-Cal programs out of millions of dollars by causing unnecessary hospitalization for paid recruits,' the lawsuit alleges.

The list of the accused is striking.

Among those named in the suit are Pacific Health Care Corp.; Los Angeles Metropolitan Medical Center, its Chief Executive John Fenton and admitting physician Frederick Rundall; Tustin Hospital and Medical Center, its Chief Executive Daniel Davis, Chief Financial Officer Vincent Rubio and admitting physicians Kenneth Thaler and Al-Reza Tajik; and City of Angels Medical Center and its owner-operators Robert Borseau and Sabaratnam. Mitts, the owner and manager of Metropolitan Healthcare LLC and the president of the 7th Street Christian Day Center, which was until recently located on skid row, is also named in the suit.

City attorneys allege that the Tustin hospital was guaranteed 40 to 50 patients a month while City of Angels got 25 to 30 patients month. Metropolitan Medical Center received patients whenever beds were available, according to the suit. City attorneys allege the admitting Drs. Rundall, Thaler and Tajik did not see their patients until shortly before their discharge. City attorneys allege that for patient referrals, Mitts' group was paid $20,000 per month each from Metropolitan Medical Center and Tustin, while City of Angels paid between $400 to $1,000 a week to the recruiting group.

The suit also alleges that the Tustin hospital's chief financial officer personally received a $3,500-a-month kickback from Mitts' group to ensure that Tustin continued to take homeless patients from the skid row center.

The Associated Press (here, via the San Diego Union-Tribune) reported that two people, including one hospital CEO, were arrested during the raids.

FBI agents arrested Rudra Sabaratnam, 64, chief executive officer of City of Angels hospital, and Estill Mitts, 64, who operated the 7th Street Assessment Center, where people are screened for health needs, the U.S. attorney's office said in a statement.A federal jury last week indicted both men. The 21-count indictment, which was unsealed Wednesday, charged them with conspiring to receive and take kickbacks for patient referrals and to commit health care fraud.
Sabaratnam also was charged with paying kickbacks while Mitts also was charged with money laundering and tax evasion.

If convicted, Sabaratnam could face 50 years in federal prison, and Mitts could face 140 years, authorities said.

We have often discussed how health care has come to be dominated more and more by ever larger organizations. Thus, the leadership of these organizations has increasing influence over health care, and hence on people's health and safety. Yet on this blog we have documented more and ever sleazier examples of ill-informed, incompetent, self-interested, and even corrupt leadership of health care organizations.

The story above is of allegations, indictments, and lawsuits. But if half of the allegations in it are true, it would represent a new low for hospital leadership.

Thus, I raise again a proposal for licensure of leaders of all organizations that affect health care, starting with hospitals, academic medical centers, and hospital systems; but also including managed care organizations and health care insurers; drug, biotechnology, and device companies; health information technology companies; etc, etc, etc. Such licensure could assure that leaders have some minimum level of knowledge about and exposure to health care; and that they must conform to some ethical standards. Licensure could be subject to removal under due process. Clearly, licensing health care organizational leaders would not solve all or most of health care's problems. But it would at least assure some minimum standard of leadership.

Wednesday, August 6, 2008

HMO's are currently embracing "pay for performance"

Quality of Care
August 5th, 2008
by Nick Jacobs

When the word quality was discussed back in the 80's, you often heard of the Baldridge Award or TQM, total quality management, as the programs that would take your organization to new heights. Today, more often than not, we hear about the Toyota Model of management or a more dated Six Sigma, 99.999999% approach to perfection. Recently, though, the government has taken over the quality quest in health care to push this industry to achieve levels of perfection.

U.S. medicine is about to launch into a new world order that will functionally save the government money, but will it produce quality? Of course, when it comes to life and death issues, there is no question that we must strive toward perfection, but when it just comes to human beings attempting to function in this very competitive environment, the game change causes casualties for both the providers and the patients.

The Government is taking a three-pronged approach to improve quality in health care:

1. They are pushing quality through public reporting. 2. Enforcing quality through the False Claims Act. 3. Incentivizing quality through payment reform.

Senator Chuck Grassley is quoted as saying, "Today, Medicare rewards poor quality care. That is just plain wrong, and we need to address this problem." HMO's are currently embracing "pay for performance" plans for physicians and hospitals. Medicare is introducing value based purchase plans and is proposing the linking of quality outcomes to physician payments.

As I have written before, hospitals will no longer be paid for hospital acquired conditions. That seems like a rather simple fix, but to appropriately determine if the condition was not acquired at the hospital, extensive testing must be added pre-admission at considerable costs to the hospitals. These additional unrecompensed costs be balanced by having fewer employees per patient, less updated equipment, and less flexibility to use more expensive drugs, but it will determine if your infection was present upon admission.

James G. Sheehan, Medicaid Inspector General of New York said, "We are reviewing assorted sources of quality information on your facility to see what it says and if it is consistent. You should be doing the same."

The spoken goal is to work toward perfection, but the underlying goals are also directed toward the financial implications. The public reporting of quality of care is intended to: correct inappropriate behavior; identify over payments, or deny payments altogether.

The False Claims Act, on the other hand has more draconian goals. When asked how he viewed the False Claims Act, Kirk Ogrosky, Deputy Chief for Health Care Fraud said, "You will see more and more physicians going to jail." Just what we need when there aren't enough docs to go around now.

Will these changes improve health care delivery? For the patients who can find the few docs and hospitals that will be left, there may be some improvement, but my personal opinion is that it will break the back of an already broken system and force more small and mid-sized hospitals out of business.

I recently had a conversation with a young medical computer specialist who took care of physician practices. He said, "Doctors and hospitals haven't figured it out yet, but they are simply becoming data entry centers for 'Big Brother' as the facts and figures are accumulated to be used against them in any manner that the payers may decide."

Maybe this is all too complicated to get our arms around, but if there are 78 M Baby Boomers and the Medicare Trust Fund is heading toward bankruptcy, then we probably will see every rule in the book being applied to keep from paying hospitals and doctors. There will simply not be enough money to go around.

Is that quality? Will these initiatives improve health care?

Prevention, wellness, optimal healing environments, and systems approaches to health and wellness will improve healthcare. Improvement will not come from the new rules that are unfolding. They may save some money, but how many lives?

"...masters of Medicare fraud, prosecutors say"

A Rolls-Royce valued at $200,000 once belonged to Eduardo Moreno, a fugitive wanted in connection with Medicare fraud.
Gallery | Fugitives suspected of fraud

The Benitez brothers were masters of Medicare fraud, prosecutors say.

They spent their Medicare millions on Mediterranean-style homes, apartments, hotels, boats, a helicopter, even a water park — all in the resort area of Bavaro, Dominican Republic, court records show.

After they were indicted on fraud charges in late May, Carlos, Jose and Luis Benitez used their Cuban passports to travel from Miami to the Dominican Republic, then to Cuba.

The three brothers are accused of defrauding the U.S. government’s health insurance program by billing $110 million in false claims for HIV drug-infusion treatments at their dozen Miami-Dade clinics. Medicare paid their companies about $84 million in reimbursements between 2001 and 2004, according to federal authorities and court records.

The Benitezes — who came to this country in 1995 and became U.S. citizens five years later — have a lot of company. They are among 56 fugitives charged since 2004 with filing at least $272 million in phony Medicare claims before disappearing from Miami-Dade. Collectively, the fugitives absconded with at least $142 million in taxpayer funds.

Thirty-three of the 36 fugitives whose names have been released by authorities are Cuban immigrants, most of whom came to the United States during the past 15 years, according to FBI, immigration and court records obtained by The Miami Herald. Half of those fugitives have fled to Cuba, according to the FBI, which based its information on travel, customs, passports, bank and computer records.

The majority of some 700 Medicare fraud defendants charged since 2004 are immigrants who share an implicit trust when they join small criminal enterprises in South Florida to defraud the government program, according to perpetrators, prosecutors and investigators.

Timothy Delaney, assistant special agent in charge of the FBI’s office in Miami, said Medicare fraud has spread over the past decade in certain pockets of South Florida’s population of 750,000 Cuban Americans — just as it has in heavily populated immigrant communities in other major cities.

Medicare is seen as an easy mark for fraud because it is built on an honor system that pays claims quickly with scant review. Also, the odds of getting caught are low and the odds of making millions are high.

Delaney said certain segments of Cuban immigrants in Miami and Hialeah — just like Armenians in Los Angeles, West Africans in Houston and Russians in New York — trust one another to form mini-rackets.

‘’We have unscrupulous providers, willing doctors and willing practitioners,'’ said Delaney. “They don’t think they’ve committed a crime.'’


Among the known Medicare fugitives who fled to Cuba: Eduardo Moreno, who came to the United States in 1997.

Moreno, 39, used a network of offices to operate medical equipment and HIV drug-infusion scams totaling $7.2 million in false Medicare claims, according to federal court records. He bought himself a $445,000 southwest Miami-Dade home and a $200,000 Rolls-Royce Phantom.

When the FBI arrested him last year on fraud charges, he made a $250,000 bond, then skipped the country — back to Havana, according to the FBI. Agents tracked him through his travel records and his relatives.

Moreno is among at least 18 identified fugitives suspected of fleeing to Cuba — with another 18 escaping to other parts of Latin America, Europe, Canada, Florida or unknown locations, according to the FBI’s account of travel records and other information.

In addition, there are 20 unidentified fugitives whose names remain under seal until their arrests.

‘’A good number of them are Cuban and they will return to Cuba, where, as you know, there is no extradition policy and we have no way to get them back at this point,'’ said Delaney, who headed the FBI’s national healthcare fraud program before transferring to Miami in 2005.

U.S. Sen. Mel Martinez, R-Florida, a Pedro Pan Cuban exile who benefited like thousands of others from the Cuban Adjustment Act, is pushing legislation in Congress to double the criminal and civil penalties for Medicare fraud offenders. While Martinez said he didn’t think Medicare fraud was strictly a ‘’Cuban issue,'’ he also condemned the Cuban government for harboring the fugitives.

‘’My first thought is, it’s one more reason why the Cuban government is an outlaw state because it allows fugitives of justice to find refuge there,'’ Martinez said.

Cuban leaders Fidel Castro and his brother Raul Castro have rarely turned over fugitives of any kind.

Tracking down Medicare fugitives in countries such as the Dominican Republic, however, can be successful because they have extradition agreements with the United States. Federal authorities are working with the Dominican Republic to pursue the Benitez brothers and seize their extensive assets in Bavaro — including a hotel called Cabañas Singapur.

Other assets include more tourist hotels, a Robinson R44 Raven helicopter, apartment complexes, luxury homes, supermarkets and a rental car agency — registered under shell companies or straw names. Dominican officials started seizing properties and freezing their bank accounts in July in cooperation with the U.S. government, which plans to return the proceeds to Medicare.

On Friday, Justice Department prosecutors filed a proposed restraining order in federal court in Miami to ensure the Benitez brothers’ assets are not sold or transferred to other parties.

The Benitez brothers’ fugitive case has made headlines in the Dominican Republic not only because of the U.S. government’s pursuit of their ill-gotten gains. Over the Fourth of July weekend, Carlos Benitez’s daughter and son-in-law — Yanelkis Benitez Ramirez and Lenin Linares Guerrero — were kidnapped. Days later, Dominican authorities rescued the couple.

Meanwhile, FBI agents have traced the Benitez brothers to Havana, according to federal authorities.

In general, the FBI has had little luck capturing Medicare fugitives abroad in recent years. ‘’We’ve had no one returned on a healthcare fraud warrant that I’m aware of,'’ Delaney said.

The one exception: In June 2004, authorities in the Dominican turned over three Medicare fugitives — Ruben Martinez; his daughter, Adriana Ramos, and her husband, Daniel Ramos — who had fled to that country months before their indictment on fraud charges.

They were part of a Miami-Dade family racket headed by Martinez, 57, that was eventually convicted of bilking $14.5 million from Medicare by charging for bogus medical equipment orders such as hospital beds, oxygen tanks and foot arch supports in 2000-02. Federal authorities recovered $1 million from Dominican bank accounts, $900,000 from U.S. banks, real estate, jewelry and a Porsche Boxster.

‘’It was a classic case of international cooperation,'’ said former federal prosecutor Wifredo Ferrer, the lead attorney in the prosecution of Martinez and 11 others. “The three fugitives were Cuban nationals, not citizens of the Dominican Republic. The Dominican authorities deemed them persona non grata and expelled them to the United States.'’


Still, one Medicare fugitive in that case is still at large: Emilio R. Seijo, who is in Cuba, according to the FBI.

The escalating problem of Medicare fraud defendants who flee has become a sore point for federal judges in South Florida.

This spring, the chief judge of the U.S. District Court in Miami raised the issue in a memo to magistrate judges, cautioning them about flight risks. U.S. District Judge Federico Moreno also reviewed Medicare defendants’ bonds in cases before him, citing the unusual pattern of defendants fleeing after they were charged with Medicare fraud and granted bail.

In June, Moreno said in court that “it seems to me that our thinking has to change — that someone from Cuba can flee back to Cuba just like someone from Mexico.'’

Moreno questioned whether the Cuban Adjustment Act — passed by Congress in 1966 to grant asylum and residency to the first wave of Cuban political refugees — was being abused by a new generation of Medicare fraud suspects. The judge wondered aloud “whether someone can be categorized as a political refugee when you can pick up and go back.'’

Moreno raised the point after learning that a former secretary charged in an $11 million Medicare healthcare scheme fled to Cuba with her son and father.

The judge had given Carmen González a $50,000 bond. Her father, Enrique González, who co-signed it, was indicted in May on separate Medicare fraud charges in a $26.2 million HIV-drug scam at other Miami-Dade clinics.

‘’I don’t know what your client’s situation is, but money goes a lot farther in Cuba,'’ the judge told Gonzalez’s attorney, Joel DeFabio. “Dollars do. And the government’s allegation is that dollars are the result of Medicare fraud.'’

Moreno isn’t the only federal judge to be blindsided.

The case of Medicare fraud felon Gustavo Smith illustrates how easy it is for fugitives to leave the United States.

After Smith was convicted on healthcare fraud charges at trial in April, U.S. District Judge Marcia Cooke allowed him to remain free on a $300,000 bond while he awaited sentencing. Prosecutors insisted that Smith be detained. Cooke placed him on home confinement.

On June 11, Smith, who had surrendered his U.S. passport, took an American Airlines flight to Santo Domingo with his girlfriend. How? Smith used his Cuban passport under the name Gustavo Smith Wong. The FBI and Dominican authorities are tracking him down. In early July, Cooke sentenced him in absentia to 10 years and 10 months in prison.


One of the obvious reasons that Medicare defendants can evade prosecution is because they’re routinely allowed to post bond before trial. But most of the Medicare defendants who fled since 2004 left South Florida before federal agents could arrest them, according to the FBI and prosecutors. In some cases, suspects get nervous when a colleague is arrested and flee before they can be implicated.

A typical example: Fermin Rey, 49, who emigrated from Cuba in 1995 and was indicted last year on charges of using a series of healthcare corporations to bill Medicare for $5.2 million in bogus medical equipment claims. Rey, described by authorities as a Santeria high priest who used associates as straw owners of his illegal businesses, failed to appear in court and is believed to be in Mexico.

Why do so many Cuban immigrants become Medicare fraud perpetrators? Andy Gomez, a senior fellow at the University of Miami’s Institute for Cuban and Cuban-American Studies, has a theory.

Gomez said some immigrants came with survival instincts cultivated under the totalitarian regime of Fidel Castro. They distrusted and cheated his communist government as a way of getting around the system, but they did not shed that behavior when they came to Miami simply because they were living in a free country.

‘’They are a product of their element,'’ Gomez said. “It’s a very difficult habit to break.'’

FBI agents not only have a hard time tracking down Medicare fugitives, but also their money.

Law enforcement officials suspect that most Medicare defendants who flee — such as the Benitezes — launder their money offshore.

Prosecutor Eric Bustillo, chief of the economic crimes section at the U.S. attorney’s office in Miami, said that once Medicare money is withdrawn from local banks it’s difficult for federal authorities to follow it.

‘’It’s the opposite of drug trafficking,'’ Bustillo said. “The drug traffickers get paid in cash, so they have to find businesses and other ways to launder it. The Medicare providers must receive all of their payments in checks or wire transfers to a designated bank account. So the money can be tracked down to that bank. But they immediately cash it out. And once they do that, who knows where it goes?'’

Federal authorities and money-laundering experts know some of the Medicare fugitives’ money ends up outside the United States. Case in point: the Benitezes’ assets in the Dominican Republic.

But unless authorities can identify the laundered Medicare millions — bank accounts, real estate, cars, boats — they can’t take legal action to go after the assets.

According to money-laundering experts, it’s easy to move dirty money to certain countries.

For a pittance, Medicare violators can hire lawyers offshore to set up shell companies and assist in the opening of related bank accounts, said Brett Wolf, a U.S. money-laundering analyst with Complinet, a London-based firm that helps financial institutions meet their compliance obligations.

‘’Cash smuggling is almost certainly playing a role,'’ Wolf said. “Considering the heavily state-controlled nature of Cuba’s financial network, it’s very unlikely that these Medicare funds are being moved through the formal banking system.'’

Fugitives, based in a country such as the Bahamas or Mexico where there is regular travel to Cuba, can go back and forth to the island, carrying thousands in cash that can be exchanged for a currency called CUCs (pronounced “kooks'’).

But it would be risky business for fugitives carrying a lot of cash, say $50,000, to attempt to bribe communist government officials unless they have connections.

Still, a Medicare fugitive with hundreds of thousands or even millions of dollars stashed in offshore accounts could live like a tycoon in Cuba, where the monthly salary averages $17.


Tuesday, August 5, 2008

Health Care Fraud and Abuse Control Program ,,,,,,REALLY?

By Jim Kouri

The Department of Justice, in cooperation with the Department of Health and Human Services, has guided the enforcement efforts of the national Health Care Fraud and Abuse Control Program (HCFAC) since its inception in 1997.

The program was designed to coordinate federal, state and local law enforcement on cases of health care fraud and abuse as part of the Health Insurance Portability and Accountability Act (HIPAA).

In 2008, the Department’s efforts to investigate and prosecute the individuals and companies who commit health care fraud are as strong as ever, thanks in large part to the Department’s many components working closely with partners at the Department of Health and Human Services, and state and local law enforcement.

Strengthening Criminal Enforcement:

In recent years, the Department has stepped up its enforcement efforts related to health care fraud, including the following accomplishments in Fiscal Year 2007:

– U.S. Attorneys’ Offices opened 878 new criminal health care fraud investigations involving 1,548 potential defendants.

– Federal prosecutors had 1,612 health care fraud criminal investigations pending, involving 2,603 potential defendants, and filed criminal charges in 434 cases involving 786 defendants.

– A total of 560 defendants were convicted for health care fraud-related crimes during the year.

– In one of the most recent enforcement actions, on May 21, 2008, Jorge Alan Rodriguez Sanchez was indicted in the Eastern District of Pennsylvania for conspiring to distribute Schedule II controlled substances illegally through an Internet pharmacy.

Beginning in 2002, Rodriguez Sanchez allegedly sold via e-mail narcotic prescription drugs, such as Oxycontin, Vicodin and Xanax to customers without prescription or legitimate medical use. Rodriguez Sanchez did not require a prescription or physical examination by a licensed physician from any of his customers. He retrieved the money sent by the customers at a Western Union location in Mexico, but shipped the drugs from Southern California to customers throughout the United States, including the Philadelphia area.

– During FY 2007, the Department opened 776 new civil health care fraud investigations, and had 743 civil health care fraud investigations pending at the end of the fiscal year.

– During FY 2007, the federal government won or negotiated approximately $1.8 billion in judgments and settlements, and it attained additional administrative impositions in health care fraud cases and proceedings.

– The Medicare Trust Fund received transfers of approximately $797 million during this period as a result of these efforts, as well as those of preceding years, in addition to $266 million in federal Medicaid money separately transferred to the Treasury as a result of these efforts. Some recent civil enforcement actions include:

(This article is a consolidation of information received by the 14,000-member National Association of Chiefs of Police’s Fraud Investigation Committee.)

Jim Kouri, CPP is currently fifth vice-president of the National Association of Chiefs of Police and he’s a staff writer for the New Media Alliance ( In addition, he’s the new editor for the House Conservatives Fund’s weblog. Kouri also serves as political advisor for Emmy and Golden Globe winning actor Michael Moriarty.

He’s former chief at a New York City housing project in Washington Heights nicknamed “Crack City” by reporters covering the drug war in the 1980s. In addition, he served as director of public safety at a New Jersey university and director of security for several major organizations. He’s also served on the National Drug Task Force and trained police and security officers throughout the country. Kouri writes for many police and security magazines including Chief of Police, Police Times, The Narc Officer and others. He’s a news writer for TheConservativeVoice.Com and He’s also a columnist for AmericanDaily.Com, MensNewsDaily.Com, MichNews.Com, and he’s syndicated by AXcessNews.Com. He’s appeared as on-air commentator for over 100 TV and radio news and talk shows including Oprah, McLaughlin Report, CNN Headline News, MTV, Fox News, etc. His book Assume The Position is available at Amazon.Com. Kouri’s own website is located at

Saturday, August 2, 2008

Health care fraud comes in many forms

Investigating Chiropractic Fraud
July 31st, 2008
Health care fraud comes in many forms and unfortunately is not limited to any one health care discipline. Chiropractic is not immune from their members engaging in fraudulent activity that violates the laws and rules governing health care. With more than twenty years of experience, including investigating chiropractic fraud and assisting chiropractors on employing compliance programs, I offer the following bullets to refresh and/or develop fraud-fighters (providers, insurers, regulators & law enforcers) insight on chiropractic fraud.

PhyAmerica Physician Group Case connect to NCFE

Judge Warns of Fines in PhyAmerica Physician Group Case.
Publication: Knight Ridder/Tribune Business News
Date: Saturday, January 24 2004

By Jean P. Fisher, The News & Observer, Raleigh, N.C. Knight Ridder/Tribune Business News

Jan. 24--A Maryland judge has warned Dr. Steven M. Scott, former owner of PhyAmerica in Durham, that he will face a $50,000-per-violation fine each time he or his associates seek to lure the company's contract physicians and clients to Scott's new competing business.

Baltimore bankruptcy court Judge E. Stephen Derby, who has presided over PhyAmerica's reorganization under Chapter 11 bankruptcy protection for 14 months, on Wednesday found that Scott had violated a

More Than 500 Backlogged Whistle-Blower Cases Allege Health Care, Drug Company Fraud

Whistle-blower lawsuits alleging that pharmaceutical companies and government contractors defrauded the federal government have created a backlog of more than 900 cases at the Department of Justice, the Washington Post reports. According to the Post, more than 500 of the cases involve the health care and pharmaceutical industries, as well as Medicare and Medicaid.
July 3rd, 2008

Medical Equipment Company Sentenced ...but what was the deal


Owner of Medical Equipment Company Sentenced to 130 Months in Prison for Health Care Fraud
July 3, 2008
A Miami resident was sentenced to 130 months in prison for his role in schemes to defraud the Medicare program, Acting Assistant Attorney General Matthew Friedrich of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida has announced.

Gustavo Smith, 43, was sentenced in the U.S. District Court for the Southern District of Florida by Judge Marcia G. Cooke. In addition to the prison sentence, Judge Cooke ordered Smith to serve three years of supervised release following his release from prison, forfeit $287,000 and pay $1,988,969 in restitution to the U.S. Department of Health and Human Services (HHS).

At trial, the jury heard testimony that Smith was the owner of Medstar Services and Orthotics Fitters of Miami, two durable medical equipment (DME) companies that Smith used to submit more than $4.6 million in fraudulent claims to the Medicare program. The items billed by Medstar Services and Orthotics Fitters to the Medicare program were primarily negative pressure pumps and related wound care supplies. Medicare beneficiaries whose names and Medicare numbers Smith used to bill for these items testified at trial that they had never heard of Smith or his companies and that they never needed or received the items being billed to Medicare by Medstar and Orthotics Fitters. Doctors whose provider numbers were used by Smith to bill the Medicare program also testified that they had never heard of Smith or his companies and that they had never prescribed the items being billed by Smith’s companies.

Several of Smith’s associates testified at trial that Smith would open companies in the names of nominee owners, who would be listed as owners in official corporate documents, bank accounts and in official Medicare documents. Once Medicare made payments on the fraudulent claims submitted by Smith’s companies, Smith employed a money launderer to cash the proceeds of the fraud and transfer the cash to Smith. Witnesses also testified that Smith used the Medicare money to buy jewelry, purchase airline tickets for personal travel and make payments on his Mercedes-Benz.

In addition to the Medstar and Orthotics Fitters fraud, witnesses also testified about several other forms of health care fraud in which Smith engaged, including: brokering the purchase and sale of DME companies for the purpose of “burning Medicare,” or submitting more than a million dollars in fraudulent claims within a window of two to three weeks; accepting payments from approximately 180 DME companies in return for agreeing to be listed in official Medicare records as the DME companies’ orthotics fitter, when in reality Smith performed no services for those companies; and owning an interest in two additional medical equipment companies that were committing Medicare fraud.

Following a six-day trial, Smith was convicted on April 23, 2008, of all counts contained in a seventeen count indictment, including conspiracy to defraud the United States, to commit health care fraud, and to cause the submission of false claims; seven counts of health care fraud; seven counts of false claims; one count of conspiracy to launder the proceeds of his crimes; and money laundering. Smith was allowed by the court to remain free on bond after his conviction, with the requirement that he be placed on home confinement with electronic monitoring. On June 14, 2008, Smith violated the terms of his release and fled the country. A warrant has been issued for his arrest.

The case was prosecuted by Trial Attorneys Hank Bond Walther and John K. Neal of the Criminal Division’s Fraud Section in Washington, D.C., with the investigative assistance of the FBI and HHS, Office of Inspector General. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Fraud Section of the Criminal Division and U.S. Attorney Acosta of the Southern District of Florida. From investigations opened during the period of Strike Force operations between March and October of 2007, federal prosecutors have indicted 82 cases with 142 defendants in South Florida. Collectively, these defendants billed the Medicare program for more than $492 million.

Source: DoJ

Net News Publisher for World News

Whistle-Blower Suits Languish at Justice.....

I wonder why?
Hmmm..........Who do we know IN the WHITE HOUSE that would like to hide this? How much has been paid and to whom?
Instead, we can think about Paris and Brittany!
BOY, are we just a bunch of DUMB AMERICANS
DO not knwo what we have until we lose it and this BUSH has really progressed in that department now hasn't he?

July 3rd, 2008 5:18 pm
A Backlog Of Cases Alleging Fraud

Whistle-Blower Suits Languish at Justice

By Carrie Johnson / Washington Post

More than 900 cases alleging that government contractors and drugmakers have defrauded taxpayers out of billions of dollars are languishing in a backlog that has built up over the past decade because the Justice Department cannot keep pace with the surge in charges brought by whistle-blowers, according to lawyers involved in the disputes.

The issue is drawing renewed interest among lawmakers and nonprofit groups because many of the cases involve the wars in Iraq and Afghanistan, rising health-care payouts, and privatization of government functions -- all of which offer rich new opportunities to swindle taxpayers.

Since 2001, 300 to 400 civil cases have been filed each year by employees charging that their companies defrauded the government. But under the cumbersome process that governs these cases, Justice Department lawyers must review them under seal, and whistle-blowers routinely wait 14 months or longer just to learn whether the department will get involved. The government rejects about three-quarters of the cases it receives, saying that the vast majority have little merit.

Disputes can stay buried for years more while the government investigates the allegations.

"Even if no new cases are filed, it might take 10 years for the Department of Justice to clear its desk. Cases in the backlog represent a lot of money being left on the table," said Patrick Burns, a spokesman for Taxpayers Against Fraud, which advocates for Justice to receive more funding to support cases by whistle-blowers and their attorneys.

Supporters of federal intervention in the cases say the dividends are substantial: In recent years, verdicts and settlements have returned nearly $13 billion to the U.S. government.

At issue in most of the cases is whether companies knowingly sold defective products or overcharged federal agencies for items sold at home or offered to U.S. troops overseas. Under the Civil War-era False Claims Act, workers who file lawsuits alleging such schemes cannot discuss them or even disclose their existence until Justice decides whether to step in.

By its own account, the 75-lawyer unit in Washington that reviews the sensitive lawsuits is overloaded and understaffed. Only about 100 cases a year are investigated by the team, which works out of the commercial litigation branch of Justice's civil division.

Critics argue that the delays are at least partly the result of foot-dragging by Justice and the federal agencies whose position it represents, especially in the touchy area of suppliers that may have overbilled the government for equipment, food and other items used by troops in Iraq and Afghanistan.

Justice lawyers have rejected about 19 cases involving contractor fraud in Iraq and Afghanistan, registering five settlements that resulted in $16 million, officials said. Government officials said this week that they are considering whether to dive into 32 more whistle-blower cases involving Iraq or the Middle East.

"It's just flatly absurd for us to be five years into this war" with so few public cases, said Alan Grayson, a whistle-blower lawyer in Florida who has criticized the Justice effort and who is running for Congress as a Democrat.

In a statement, Justice spokesman Charles Miller said that career lawyers and supervisors base their determinations on merit, not on political sensitivities. "Our decisions to intervene or decline in cases involving Iraq and the Middle East are entirely consistent with our record in [whistle-blower] cases generally," he said.

Help from Justice greatly enhances the chances that a complicated fraud scheme can be unraveled, lawyers say. And department statistics show that cases Justice turns away win paltry, if any, financial recoveries.

Key lawmakers have called on Justice to make false-claims investigations a priority.

"Whistle-blowers are the key to the secrets locked in closets throughout the federal bureaucracy and government contractors," said Sen. Charles E. Grassley (R-Iowa). "These patriotic Americans stick their necks out, against all odds, to help the federal government pursue fraud and save taxpayers tens of billions of dollars that would otherwise be lost."

Last month, Deputy Assistant Attorney General Michael F. Hertz told Congress that "the number and increased complexity of the fraud schemes presented to the department, combined with the volume of cases now under review, certainly present challenges."

Among the largest false-claims cases to date are a $650 million settlement earlier this year by drugmaker Merck in connection with an alleged failure to repay Medicaid rebates; a $515 million deal with Bristol-Myers Squibb to cover illegal drug pricing and marketing; and a $98 million agreement with software maker Oracle over pricing.

If their claims are successful, whistle-blowers can receive a hefty slice of the settlements or verdicts, sometimes as much as 20 percent of the award. A former Merck sales manager collected $68 million earlier this year for his role in exposing an alleged drug-pricing scheme.

Even bigger lawsuits containing potentially explosive allegations are waiting in the wings. The vast majority, more than 500 cases, involve the health-care and pharmaceutical industries and often involve Medicare and Medicaid funds.

Only a few hints of the Iraq and Afghanistan disputes have erupted publicly. One is a suit filed by two former employees of Custer Battles, a defense contracting company in Fairfax. The workers accused the company of inflating expenses on a contract it won to replace the Iraqi currency. After a three-week trial in 2006, a jury found in favor of the plaintiffs and awarded them $10 million. But U.S. District Judge T.S. Ellis III later tossed out the case, ruling that the money at issue, controlled in the early years of the Iraq conflict by the Coalition Provisional Authority, belonged to the Iraqi government, not U.S. taxpayers.

Justice declined the whistle-blowers' request to intervene before the case went to trial, plaintiffs' lawyers said. The government eventually weighed in with a court brief on behalf of the whistle-blowers when the case was appealed.

Frederick M. Morgan Jr., a Cincinnati lawyer who represents whistle-blowers, said that the numbers of lawyers willing to take on cases involving defense contractors has dwindled, in part because of Justice's slow decisions.

One of Morgan's lawsuits, against contractors hired by the Navy to build nuclear submarines and an Ohio company that manufactured submarine valves, took five years to resolve.

Another case, involving the manufacture of the F-22 fighter, was filed in early 1999. It was late 2006 before Justice decided not to intervene. The case is now in active litigation.

"The impact of a 7 1/2 -year delay in the litigation of a case is difficult to quantify but impossible to discount," Morgan said.

Whistle-blower lawyers say other factors can contribute to long delays, including the difficulty in investigating claims in war-torn areas and complications that arise when military officials contend that technology or other products at issue in the lawsuits are classified. In addition, Justice lawyers who handle civil cases often cannot proceed until authorities decide whether a case merits criminal prosecution, the lawyers said.

Even when older cases are pushed into the open, the passage of time can present courtroom challenges.

Last year, a D.C. jury awarded whistle-blower Richard Miller more than $30 million, a figure that now-Chief Judge Royce C. Lamberth tripled to $90 million. But in the dozen years since the suit was filed, witnesses' memories of events had dimmed and the U.S. Agency for International Development had tossed its investigative files.

The judge blasted civil division lawyers for "doing virtually nothing" to follow up for four years after Miller brought forward allegations in 1995 about bid rigging on construction contracts in Egypt. The delays meant "loss of evidence, fading memories, disappearance of documents," he wrote.

Justice spokesman Miller said that the civil case was stalled for years because criminal proceedings in the matter took priority. He added that the whistle-blower did not object to the government's repeated entreaties for more time.

Last week, Lamberth denied defense motions for a new trial. But the verdict is likely to be appealed, according to lawyers who participated.

"I have a feeling we're some way away from resolution," said Charles S. Leeper, a lawyer for B.L. Harbert International, the main construction company involved in the case.

Woman pleads guilty to health care fraud

A Severna Park woman pleaded guilty in federal court to health care fraud yesterday for billing for medical services she did not provide, according to the U.S. attorney's office.

Virginia Vought Acree, 49, a state-licensed clinical specialist in child and adolescent psychiatric and mental health nursing, admitted to falsely billing for services she did not provide on hundreds of occasions from January 2003 to November 2007, prosecutors said. She filed fraudulent insurance claims to collect more than $200,000 from the government and private health care plans.

At times, Acree billed for face-to-face psychotherapy services at the same time she was on vacation in other states or countries, or attending out-of-town conferences, prosecutors said.

Sentencing is set for Oct. 7. Acree could get a maximum sentence of 10 years in prison and a $250,000 fine, prosecutors said.