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Healthcare operators plead guilty to $60 million healthcare fraud

December 23, 2011

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The Federal Bureau of Investigation (FBI) and the Department of Health and Human Services (HHS) announced that three operators of a local healthcare agency have entered guilty pleas for their involvement in a $60 billion home healthcare Medicare fraud scheme. The three defendants with the assistance of their Miami criminal lawyers entered guilty pleas before a United States district judge to one count of conspiracy to commit Medicare fraud. According to court documents, the defendants were family members that fraudulently billed Medicare for home healthcare and therapy services that were never provided. The defendants used recruiters to locate patients in and around Miami who would in turn provide their Medicare numbers to the illegal enterprise. The company would bill the federal healthcare agency and pay kickbacks to the recruiters.

The federal government continues to crackdown on Medicare fraud. The cases being prosecuted generally occurred prior to the new changes in the billing requirements and polices related to healthcare claims. The reason for the delay in the prosecutions in these types of cases is caused by the extensive investigations and the numbers of defendants surrounding these types of organizations. Generally, the criminal investigations last between two and three years culminating in the arrests of several defendants. Once the defendants are charged in criminal court, many of them, due to the overwhelming evidence in the case decide to cooperate with federal prosecutors to avert long prison sentences. As part of the cooperation, defendants are required to disclose other individuals who were involved in the fraud. For example, clinic owners or home healthcare providers are required to give up doctors, therapists and recruiters who were also involved in the fraud.

Prior to cooperating with the federal government, defendants should seek advice from an attorney with experience in defending Medicare fraud cases in federal court. All of the documents, audio and video recordings and other evidence obtained in the case must be thoroughly reviewed before making the decision whether to cooperate or not. Entering into a cooperation agreement with the government should happen quickly if that is the decision made into how to handle the case. The more fresh information provided to investigators will increase the likelihood of a significantly reduced sentence. Delaying cooperation will allow for other defendants to come forward and provide the information. Providing information that has already been provided to the government is not as helpful when seeking a sentence reduction. In large part, the prosecution will determine the value of the information which in turn will be used to decide the amount of the reduction in the form of a 5K or a Rule 35.

Prior to the reduction, the defendant will be scored according to the United States Sentencing Commission Guidelines. Defendants will score differently depending on a couple of factors. First the amount of the loss to Medicare will significantly impact the guideline range. Other factors that will also impact the guideline range include whether the defendant was an owner or operator of the company, whether a defendant was a planner or supervisor, or whether the defendant played a minor role in the criminal offense. A defendant's level of involvement in the fraud will play a large role in determining whether levels are increased or decreased in calculating a guideline range. The key is to reduce the guideline range as much as possible before the sentence in finally reduced for cooperating with the government.

Three Guilty Pleas in $60 Million Medicare Fraud, South Florida Business, December 20, 2011.
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