DOJ Is Creatively Conjugating To Stop Public Corruption

It just warms the cockles of my heart when I see multiple, state and federal agencies come together and perform the sensual dance of taking out these nefarious fraud schemes.

These innovative, multi-jurisdictional task forces are able, through conjugal agency partnerships, to circumvent intentionally constructed statutory barriers by decentralizing investigative authority, to collaborate and bring forth criminal indictments to what have been traditionally known as civil penalties.

Monmy is so proud of her babies.

via GIPHY

The investigation was conducted by IRS Criminal Investigation, the California Department of Justice Tax Recovery and Criminal Enforcement Task Force, the Department of Health and Human Services – Office of Inspector General, the Federal Bureau of Investigation, and the United States Food and Drug Administration’s Office of Criminal Investigations.

Owners of Two Los Angeles-Area Drug Wholesale Companies Arrested in $20 Million Federal ‘Structuring’ Conspiracy

          LOS ANGELES – The owners of two local drug wholesale companies were among four defendants taken into custody this morning on federal “structuring” charges that allege they made millions of dollars in cash deposits designed to circumvent federal reporting requirements.

          Law enforcement authorities this morning arrested Richard Kayseryan, 41, of Burbank, the owner of Burbank-based TriMed Medical Wholesalers, Inc. Kayseryan is the lead defendant in a 20-count indictment returned on April 6 by a federal grand jury that charges four individuals and TriMed in relation to two separate schemes to structure millions of dollars in proceeds through “funnel” bank accounts set up in the names of shell companies.

          Two other defendants – Derou Biglari, 31, and Jivani Markarian, 33, who own the Glendale-based drug wholesale business JD Pharmaceutical Wholesaler, Inc. – and the fourth defendant – Rafik Mesropyan, 56 – surrendered this morning. These three co-conspirators, all Glendale residents, are charged with depositing millions of dollars of TriMed checks for Kayseryan, and returning the funds to him in the form of cash.

          The four individuals and TriMed are expected to be arraigned on the indictment this afternoon in United States District Court.

          As part of the scheme, TriMed collected millions of dollars from business activities and Kayseryan prepared checks that he delivered to his co-defendants. The co-conspirators deposited the checks into the funnel accounts and immediately withdrew the funds in cash in amounts at or under $10,000 per transaction, according to the indictment. These transactions were designed to prevent banks from reporting the cash withdrawals to the federal government, which is required for every cash transaction of more than $10,000.

          The indictment also charges Kayseryan with lying to federal agents about the funds during an interview in June 2016. Kayseryan allegedly falsely claimed that “he issued TriMed checks payable to the shell businesses,…for the purpose of making interest-bearing ‘investments’ in the shell businesses” and that he “did not receive ‘one cent’ of the funds from the TriMed checks back.” In fact, the businesses did not exist at all, and Kayseryan received millions of dollars in funds back from the checks in the form of cash.

          Finally, the indictment charges Kayseryan with filing false tax returns that fraudulently overstated TriMed’s business expenses.

          Investigators believe that Kayseryan wrote checks to the shell companies from 2010 through 2015 totaling more than $20 million and that Kayseryan claimed these checks were to pay business expenses. In fact, most of the shell companies did not actually exist other than on paper.

          This indictment marks the third phase of Operation “Psyched Out.” The investigation previously resulted in convictions against 17 defendants connected with the operators of a fraudulent medical clinic, Manor Medical Imaging. A medical doctor employed at the location, Kenneth Johnson, and two owners of a San Marino pharmacy, Phic Lim and Theanna Khou, were convicted in that case. In the second phase, the owner of a Glendale pharmacy, Peter Bagdasarian, was convicted of prescription drug misbranding connected to the scheme.

          An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

          If convicted of the 20 counts in the indictment, Kayseryan would face a statutory maximum of 94 years in prison. Biglari and Markarian, if convicted, would each face 45 years, and Mesropyan could be sentenced to as much as 35 years in prison.

          Two other conspirators, identified in the indictment by initials as M.F. and S.G., previously pled guilty to federal structuring charges.

          The investigation was conducted by IRS Criminal Investigation, the California Department of Justice Tax Recovery and Criminal Enforcement Task Force, the Department of Health and Human Services – Office of Inspector General, the Federal Bureau of Investigation, and the United States Food and Drug Administration’s Office of Criminal Investigations.

          The case is being prosecuted by Assistant United States Attorneys Benjamin R. Barron and Christopher Kendall of the Organized Crime Drug Enforcement Task Force.

Voting is beautiful, be beautiful ~ vote.©

Rule of Construction

The general public has been only allowed to be informed on one small component of Social Security Title IV-E, and that is foster care placement reimbursement.

Similar to the concept of child support, Title IV-E funds the "food and shelter" portion of the care of the child, but Title IV-E is entails much more than this. A major, mostly unspoken component of Title IV-E is training.

Very little is known outside the inner circles behind the iron curtain of child welfare regarding the rule of construction.

The rule of construction is, in essence, how a state interprets the federal mandates regarding Title IV-E funding, how data are to be collected and warehoused, and how a state may stay in substantial compliance.

In 1980 Congress revised foster care provisions of the Social Security Act (SSA) (Public Law 96-272) to create what we know today as Title IV-E (42, US Code, Sections 670-675).

SSA Title IV-E reimburses States the federal portion through the Federal Financial Participation (FFP) rate, the same rates found in Targeted Case Management called Federal Medical Assistance Percentage (FMAP). But for administrative costs, the FFP is 50% for eligible costs.

Here is a list of eligible Title IV-E administrative expenditures:

• (i) Referral to services;
• (ii) Preparation for and participation in judicial determinations;
• (iii) Placement of the child;
• (iv) Development of the case plan;
• (v) Case reviews;
• (vi) Case management and supervision;
• (vii) Recruitment and licensing of foster homes and institutions;
• (viii) Rate setting; and
• (ix) A proportionate share of related agency overhead.
• (x) Costs related to data collection and reporting.

In order for the Feds and the States to split the costs, the States must be in substantial compliance.

Substantial Compliance

Substantial compliance basically means that when the Administration for Children and Families (ACF) of the U.S. Department of Health and Human Services (DHHS) and its Regional and Central Offices come to do an on-site review of the State agency for Title IV-E eligibility of children, it must come within 0.10% of statistical significance in random sample of cases reviewed.

TRANSLATION: The ACF allows a state agency a maximum of 8 children out every 88 simple random sampling to be taken from their homes, placed in foster care, Parental Rights Terminated, and adopted out when they were never eligible.   Substantial compliance means a state is allowed to make so many administrative mistakes, such as fictitious billing, over medication and unnecessary medication, phantom services, ineffective services, improper and unnecessary removals, waste and abuse of funds, defalcation, embezzlement, sexual abuse, physical abuse, torture, murder, human trafficking, oh the list goes on and on but the idea of a "state mistake", I believe, is understood.

So what happens if the state agency is not in substantial compliance?

A state determined to be in “non-compliance” has to develop a Program Improvement Plan and go through a secondary on-site review with a sample of 150 cases taken from the most recent Adoption and Foster Care Automatic Reporting System (AFCARS) submission to come within 0.10% statistical significance.

That means that the second time the feds review the state Title IV-E eligibility, they are allowed to get away with more mistakes

Even though the number of children may go from 8 to 15 who were found not eligible for foster care, it is still considered a 10 percent error of the random sampling.

Basically, States send up case level information, whenever and however they want, to the ACF and its contracted entity, that is eventually used for research and purposes of funding. As it has been seen here, it does not matter if children are improperly or unnecessarily removed from their homes or even tortured in foster care, because the numbers still get crunched by those who never hear about the "mistakes behind the iron curtain":

Child Welfare League of America
Children's Rights
Child Welfare Gateway Information
National Data Archive on Child Abuse and Neglect

Quintessentially, all data and methods by which these data are handled, are false and suspect in child welfare due to "substantial compliance."

This is fraud.

There is a reason why the ACF, U.S. DHHS and its Regional and Central Offices allow the fraud to happen and it has a name:

RULE OF CONSTRUCTION

The Rule of Construction says:

Sec. 478. [42 U.S.C. 678] Nothing in this part shall be construed as precluding State courts from exercising their discretion to protect the health and safety of children in individual cases, including cases other than those described in section 471(a)(15)(D).

TRANSLATION: States can train its people to do whatever they want and there is nothing Federal can do to stop them.  Sometimes there are those who must suffer for the benefit of all, for child welfare is an industry.

The following are examples of child welfare training that are not acceptable for Title IV-E reimbursements:

• CPR is not eligible for Title IV-E training.
• Cornell's TCI training is not eligible for Title IV-E training.

Cornell Lead Title IV -E Training for County of Santa Clara Social Services 2009

SCOTUS Child Welfare Activities Escalate

The Supreme Court of the United States has been busy rendering opinions dealing with child welfare.

This should be considered significant as there are multiple layers to muddle through just to get a case to the highest court of the land. If one is successful, then it has to make it past the clerks.

The clerks are the ones who decide if a case is of a significant public issue, then passes it on to their boss, being the justice. In the last few months, I have had an increase in traffic from SCOTUS as well as the U.S. Department of Justice, U.S. Department of Health and Human Services Office of Inspector General, U.S. Social Security Administration, various States Attorney General Offices as well as U.S. Department of Defense, numerous Army Bases and U.S. Naval Intelligence.

The significant public issues surrounding child welfare are finally coming into the public eye by being catapulted with my exposure of Medicaid Fraud in Child Welfare.

I have a very small, yet specifically targeted audience that is listening intently to me. For that, I thank each and everyone of your for joining me to bring transparency and accountability to child welfare.

The Constitution prohibits the imposition of a life with-out parole sentence on a juvenile offender who did not commit homicide. A State need not guarantee the offender eventual release, but if it imposes a sentence of life it must provide him or her with some realistic opportunity to obtain release before the end of that term. The judgment of the First District Court of Appeal of Florida is reversed, and the case is remanded for further proceedings not inconsistent with this opinion.

Graham v. Florida SCOTUS Opinion

Feds Recovery $4 Billion in Fraud in 2009

Last year, the Federal government recovered more than $4 billion in health care fraud. It may not seem much, but when you consider it was only a few agents in a handful of cities and a few bold individuals who brought forth qui tams under the False Claims Act, it is quite significant.

Here are highlights of some of my favorite child welfare schemes of 2009:

• In Mississippi a Psychologist conspired with others to submit false and misleading patient diagnosis to the Social Security Administration in order to assist many of his patients to obtain disability benefits. Once a patient was approved for disability benefits, Medicare was billed, claiming that he was providing psychological health care services to patients on a weekly or semi-weekly basis, when in fact, he was treating these patients only a few times a year, if at all.

TRANSLATION: Psychologists label foster kids with made up disorders like Separation Anxiety, Bi-polar, ADHD, Defiance and Depression, prescribe heavy doses of unnecessary medication,  then submit false reports to the court to keep the kids in foster care longer, and do not provide any services that are billed to Medicaid.

• In Michigan and New York, the States claimed Medicaid reimbursements for outpatient expenditures for drug products that were not eligible for Medicaid coverage because they were dispensed after their termination dates or less than effective. In addition, the States claimed for drug products that were not approved by Medicaid.

TRANSLATION: Child welfare psychological services provided foster children with large doses of out-dated and unnecessary medication to keep them in the system longer and billed Medicaid.

• Pennsylvania did not comply with federal and state mandates in Targeted Case Management by billing for service unsupported by case records or insufficiently documented.

TRANSLATION: Judges were sending kids to jail and foster care for, for no reason, got kiddy kickbacks and billing Medicaid.
DHHS and DOJ Annual Health Care Fraud and Abuse Control Program Annual Report for FY 2009

The one thing that should be noted is the States Medicaid Fraud Units had absolutely nothing to do with recoveries because of the inherent conflicts of interest in child welfare.

"Criminals have concluded that health care fraud is a safe bet. It is
imperative that we change the calculus," said Daniel R. Levinson,
Inspector General for the Department of Health and Human Services.

HHS Revs Up Its Medicaid Fraud Control Unit Section

UPDATE:  After review of HHS OIG work to rev up States Medicaid Fraud Control Units, as of May 2016,  I was not impressed.

Hot off the presses!  

U.S. Department of Health and Human Services Office of Inspector General is revving up oversight for the States Medicaid Fraud Control Units.

New Medicaid Fraud Control Unit Section

To better showcase the important role played by State Medicaid Fraud Control Units (MFCUs), OIG has developed a new section of the website devoted to these State organizations and their activities.  The 50 MFCUs, which are funded on a matching basis as part of the Medicaid program, are established in Federal law as "single, identifiable" Units operated by the States and devoted to the investigation and prosecution of Medicaid fraud and patient abuse and neglect.  As part of its oversight responsibility for the MFCUs, OIG conducts periodic reviews of Unit activities and issues annual certifications.
You can explore the new MFCU section and its various links here:
http://www.oig.hhs.gov/fraud/mfcu/

As a feature of this new section, OIG will now be featuring press releases of enforcement actions taken by these State agencies.  You can view our initial list of April MFCU enforcement actions here:
http://www.oig.hhs.gov/fraud/enforcement/state/2010/04.asp  You can view February and March enforcement actions by going through the "State Enforcement Actions" link in the main MFCU section.

For all your latest news in State Enforcement Actions with Medicaid Fraud Control Units, keep coming back and sign up for my RSS.  It's on!

National Medicaid Fraud Strategies Released

Even though the testimony of U.S. Department of Health and Human Services Inspector General to the House Appropriations Committee on Labor, Health and Human Services, Education, and Related Agencies, March 4, 2010 on the activities to combat Medicare and Medicaid fraud are vitally important, the testimony of the Deputy Director proved to be even more revealing.

Operations of the Health Care Fraud Enforcement Task Force, H.E.A.T. will be expanding to 13 new locations to stop the unbelievable levels of health care fraud across the nation.

Various federal statutes and work with the States Medicaid Fraud Control Units (MFCU) will now be used to go after the fraudfeasors. Let's sit back and see if the MFCUs will touch child welfare fraud. Stay tuned.

Testimony of DHHS Deputy Inspector General March 4, 2010

Feds Bust Maine for Medicaid Fraud

State sues to defend federal Medicaid claims

By Meg Haskell
BDN Staff

BANGOR, Maine — Maine’s Department of Health and Human Services has asked a federal court to overturn a decision of the U.S. Department of Health and Human Services that disallows close to $30 million in federal case management funds for children in Maine’s Medicaid program, called MaineCare.

If the state should lose its case, Maine DHHS could be required to repay the money, which dates to services delivered in 2002 and 2003.

State Health and Human Services Commissioner Brenda Harvey said Tuesday that she was unable to comment on the specifics of the case, but that it would have “no short-term impact” on the current budget-paring process under way in Augusta.

In the longer term, she said, the state expects to win its case and has not made plans for repayment of the money.

A 2007 audit performed by the federal DHHS Office of Inspector General found that Maine DHHS had overstated expenditures associated with delivering case management services for children in the MaineCare program, including many in state custody. The OIG also found that the state had failed to ensure that Medicaid costs for those services were “reasonable, allowable, and allocable, in accordance with Federal requirements.”

Specifically, the OIG audit found that the cost of delivering the case management services in question was overstated by nearly $10 million; that the state had illegally included administrative and support costs in its charges; and that unallowable services considered “direct services” for children in the foster care system had been improperly billed to the federal Medicaid program.

The conclusions were based on a review of more than 600 case management services delivered in 2002 and 2003 to 99 children, most of whom were in state custody at the time.

Federal Medicaid policy defines allowable case management services as those services that help people “gain access to needed medical, educational and social services.”

The direct provision of such services themselves is not an allowable case management expense.

In a decision based on the findings of the audit, the Centers for Medicare and Medicaid Services determined that Maine DHHS should repay $27.9 million to the federal Medicaid program. The state in 2008 appealed the decision to the federal DHHS appeals board, arguing that all services in question had been delivered and billed under Medicaid guidelines and definitions in effect at the time.

In its decision dated Dec. 24, 2009, the appeals board found that the state had failed to demonstrate that the disallowed expenditures were, in fact, allowable and upheld the CMS ruling.

In its complaint filed Monday in U.S. District Court in Bangor, Maine DHHS, represented by the state Attorney General’s Office, asked for judicial review of the federal decision and requested a reversal of that decision. The state also seeks a declaration that the actions of the federal DHHS are “contrary to federal law, arbitrary and an abuse of discretion.”

No court date has been set.

Actually, Maine DHHS is getting off quite easily with the determination of the federal DHHS. The documented history of child welfare fraud waste and abuse goes well beyond this audit, as it must be kept in mind, that only a sample of cases (99) were examined in a short period of time.

Maine Targeted Case Management Audit 2007

Here is my prediction: Maine will loose, miserably, but will not go down without a fight. I have all intentions of keeping this in the media because it looks like there will be a federal take over exactly what happened to Nebraska.

Then, DOJ and DHHS OIG will have a template to go state to state to stop Medicaid Fraud in Child Welfare.

Thank you, from the bottom of my heart, General Holder and Secretary Sebelius, thank you for listening to me.

Initiating Empirical Research in Children's Health Care

Sebelius Awards $100 Million to 10 States to Test Innovations in Children's Health Care

Health and Human Services Secretary Kathleen Sebelius today announced $100 million in federal grant funds to 10 states to improve health care quality and delivery systems for children enrolled in Medicaid and the Children’s Health Insurance Program (CHIP).

The grants, which will be awarded over a five year period, were funded by the Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA). The money will help states implement and evaluate provider performance measures and utilize health information technologies such as pediatric electronic health records and other quality improvement initiatives.

“We all have a stake in the health of our nation’s children,” said Sebelius. “Exploring new technologies and initiatives will help ensure our kids get the high quality care they need and deserve.”
The grants are totally federally funded and are designed help establish a national quality system for children’s health care through Medicaid and CHIP.

“These grants will test the most current theories of how to improve the quality of care delivered to children,” said Cindy Mann, director of the Center for Medicaid and State Operations within CMS.  “These awards will help create the foundation for a more responsive and effective national system of high quality health care for children.”

Awardees represent both single-state projects and multi-state collaborations.  Grantees working in multi-state partnerships will share award funds with those partners with funding ultimately distributed among 18 states in total. The awards were granted to:

Lead State	Partner(s)	First-Year Award	Five-Year Total Award
Maine	Vermont	$2,030,721	$11,277,362
Oregon	Alaska, West Virginia	$2,231,890	$11,277,361
Pennsylvania		$1,934,754	$9,777,361
North Carolina		$2,210,712	$9,277,361
Florida	Illinois	$880,371	$11,277,361
Massachusetts		$1,496,542	$8,777,542
Colorado	New Mexico	$1,722,161	$7,784,030
Utah	Idaho	$2,877,134	$10,277,360
South Carolina		$2,214,263	$9,277,361
Maryland	Georgia, Wyoming	$2,401,467	$10,993,171

Eight of the 10 grantees will test a new set of child health quality measures, and seven of the ten states will use the funds to implement health information technology (HIT) strategies with two states specifically planning to develop a new pediatric electronic health record format.

More information about CHIP can be found at www.InsureKidsNow.gov.

More information about health information technology initiatives and experimental methodologies on state levels can be found at http://beverlytran.blogspot.com/2010/01/there-was-no-nebraska-compromise.html.

Every state is participating in this initiative.  The ones that received nothing are the observed.  There are more than 18 states that are to receive treatments, and the treatments vary.

Looks like I owe Cindy Mann an apology...but we shall wait and see.  I'm watching you, girl.  This is absolutely brilliant.

XOXO

States Refuse To Stop Fraud in Child Welfare

Despite federal audits, examinations and reviews, States are willing to jeopardize its Federal Financial Participation rates and take the risk of loosing all federal funding for child welfare operations because of the pervasiveness of fraud in child welfare.

Since the States refuse to stop fraud in child welfare, I am putting a formal call to action to the legal community:

START EDUCATING THE PUBLIC TO BECOME FCA WHISTLEBLOWERS

DHHS Fraud Warning to Administration for Children and Families

For more information on ways to stop fraud in child welfare, contact me, now.

Stop Medicaid Fraud In Child Welfare

When watching this video, I want you to replace the word "MEDICARE" with "MEDICAID" and then replace "SENIORS" with the word "CHILDREN" and you will have visual of fraud, waste and abuse in child welfare.

If you suspect Medicaid fraud in child welfare, contact your State Attorney General Medicaid Fraud Control Unit and the U.S. Department of Health and Human Services Office of Inspector General to report it.

Report Fraud in Child Welfare

Phone:

1-800-HHS-TIPS

(1-800-447-8477)

Fax:

1-800-223-8164

TTY:

1-800-377-4950

E-Mail:

HHSTips@oig.hhs.gov

Mail:

Office of Inspector General

Department of Health and Human Services

Attn: HOTLINE

PO Box 23489

Washington, DC 20026

Can CMS Encourage States To End Medicaid Fraud?

There seems to be major possible implications here on how the nation views child abuse and neglect, but then again, this could just a cursory assessment.

With almost all states reporting most recent data,it shows 59% of child maltreatment cases are neglect.

Traditionally, poverty has been codified by the States as neglect, leading to a distorted perception in actual intentionally perpetrated harms. As poverty increases, there is a direct and parallel relationship in the increase of child neglect cases. David G. Gil, a pioneer in the constructing the relationship between poverty and child abuse, was the streamlining catalyst for the States to generate policies to qualify for the funding of Child Abuse Prevention Treatment Act(CAPTA) programs.

CAPTA, being an entitlement program, established eligibility criteria based on meeting the Social Security Title IV-A poverty means test. Simply put, one must be impoverished to qualify for child welfare programming.

In the wake of the nation's economic challenges, factors such as unemployment, have led to an increase demand in social assistance. Since social assistance program funding has been shifted to child welfare, the only opportunity for assistance in the realms of keeping children in the community, as opposed to removals, and providing human assistance to meet basic living requirements (i.e. affordable housing, transportation, education, medical) has been through entrance of foster care.

These new Medicaid guidelines and waivers present States with opportunities to shift social philosophies from the criminalization of poverty to the promotion and securing of the general welfare of the nation by the amelioration of fraud in child welfare.

Louisiana has launched an new approach to combating Medicaid fraud, waste and abuse. Perhaps the new CMS guidelines can accentuate the Louisiana initiatives. I will be monitoring this national pilot program to stop Medicaid fraud. It is my belief that Louisiana's initiatives may prove effective in the realms of improving child welfare Targeted Case Management compliance and reducing unnecessary state placements of children out of the home.

It will be most interesting to observe the activities of the Louisiana Attorney General Medicaid Fraud Control Unit.

Guidance Letter to States Medicaid Director

HHS Secretary Interuptus

Today, Kathleen Sebelius, U.S. Secretary for the Department of Health and Human Services made the announcement to appoint new Regional Directors.

Today, the Secretary took groundbreaking steps to demonstrate leadership by interrupting the status quo of the previous Regional Directors' commitments to maintaining the states breathtakingly blatant revenue-maximizing schemes in the arenas of Medicare and Medicaid.

Breaking up the coital partnerships of the previous Region Directors with the states will be a severely traumatic event as, we all shall hope, the newly appointed Regional Directors will adopt a more ethical position in the execution of their duties to assure the public that the states are meeting their federal mandates for grant funding, particularly Medicaid.

Fraud of any kind is a threat to our nation's economic security, now, and in the future. Ending fraud in child welfare is the onus of society.

Madame Secretary, I extend my deepest gratitude, with sincerity and serenity for listening to me.

* Cristal Thomas, Regional Director Region V (IL, IN, MI, MN, OH, WI)
* Marjorie McColl Petty, Regional Director Region VI, (AR, LA, NM, OK, TX)
* Judy Baker, Regional Director Region VII (IA, KS, MO, NE)
* Susan M.R. Johnson, Regional Director Region X (AK, ID, OR, WA)

My eyes are affixed. Women with skills.

Everyone Benefited In Pennsylvania, Except Danieal Kelly

To properly cover all facets of Pennsylvania's Department of Public Works Office of Children Youth and Families administrative failures, one must include the investigative findings of the Grand Jury Report on the woefully egregious actions and inactions of federal, state, county, city administrators and the parents of Danieal Kellly.

The failures of the State of Pennsylvania reach far beyond the ethical and legal obligation to protect a child. These failures reflect the lack of transparency, accountability and oversight of the child welfare system in the United States.

Look at it this way, everyone benefited from the child welfare system, except Danieal Kelly.

Pennsylvania Grand Jury Report of the Life and Death of Danieal Kelly

Child welfare, in its current form, does not and will not ever function for the common good and the general defense of the people.

A Round of Applause for Detroit H.E.A.T.

Ladies and Gentlemen,

Let's stand up and give a round of applause to our new friends at the U.S. Department of Health and Human Services Office of Inspector General and the U.S. Department of Justice Attorney General for catching a Medicare Fraudfeasor!

This same, exact scheme is a mirror image of what is done in Medicaid. Instead of the area of physical therapy, you have it in foster care and adoption because children do not sign nor review the documents, and, parents are not privileged to even know what is going on with their own children.

Free reign on fraud, straight-up bilking tax dollars. No accountability, no transparency, no oversight.

Here is a real life example. I know because I talked to the people who were actually doing it, and I have the documents to prove it. And yes, the documents are cyber-filed protected.

In Wayne County, Michigan, there are no bids on state child placing agency (CPA) contracts. These 5 agencies provide services to abused and neglected children. Each year, the big 5 CPAs submit letters of renewal, that include an increase in the contractual fees.

Then, the big 5 submit billing to Wayne County for certain services provided to children. There is no human way possible to verify if the services were actually rendered. It is relatively economically impossible to even go through each and every billing statement to even see if the clients meet eligibility criteria. Here is an example:

In Wayne County foster care, they will use referrals to the Juvenile Assessment Center for adults. Yes, that is correct, adults. The majority of the time the services rendered to these "adults" are only on paper, the same paper that is submitted for billing reimbursements.

Then in Wayne County, you have employment services for children. Yes, employment services for children, where the county will conduct employment background checks to make sure these children are eligible for employment, sometimes 5 days a week. I would reveal who the check was made out to, but I do value my life.

But the fraud in foster care only gets better.

In Wayne County you have what is called the Will Smith/Bill Smith billing system. Basically, a child is taken into foster care and billed as a foster care child. Then, with a cut and a paste of the same Social Security number, Will becomes Bill, who is now a juvenile delinquent. And there you have it, double-billing.

Yes, there is a legitimate form of double-billing called "dual jackets". This is when a child is in one system and needs services from the other but a review of the records will show that the name remains the same.

I will be providing the Medicaid Fraud Strike Force with as much instruction as possible to assist in the detection, identification, and recovery. I want Michigan to be the model state.

I will also be coming out soon with my book to better understand how the industry functions.

Until then, bravissimo H.E.A.T., encore!

Department of Justice Press Release

For Immediate Release
August 26, 2009 United States Attorney's Office
Eastern District of Michigan
Contact: (313) 226-9100

Detroit Area Physical Therapist Pleads Guilty to Causing More Than $1.6 Million in Fraudulent Medicare Billing

Detroit area physical therapist Jay Jha, 45, pleaded guilty today to participating in a conspiracy to defraud the Medicare program of approximately $18.3 million. Jha, of Troy, Mich., pleaded guilty to one count of conspiracy to commit health care fraud before U.S. District Judge Gerald Rosen. At sentencing, scheduled for Dec. 16, 2009, Jha faces a maximum penalty of 10 years in prison and a $250,000 fine.

According to information contained in plea documents, Jha, a physical therapist licensed in the state of Michigan, began working in approximately February 2003 as a contract therapist for a co-conspirator. The co-conspirator owned and controlled several companies operating in the Detroit area that purported to provide physical and occupational therapy services to Medicare beneficiaries. Jha admitted that he, the co-conspirator, and others created fictitious therapy files appearing to document physical and occupational therapy services provided to Medicare beneficiaries, when in fact no such services had been provided. According to court documents, the fictitious services reflected in the files were billed to Medicare through sham Medicare providers controlled by co-conspirators.

In order to create the fictitious therapy files, Jha acknowledged that his co-conspirators paid cash kickbacks and other inducements to Medicare beneficiaries, in exchange for the beneficiaries’ Medicare numbers and signatures on documents falsely indicating that they had received physical or occupational therapy. Jha admitted that he was one of the licensed physical or occupational therapists from whom the co-conspirator obtained signatures on fictitious "progress notes" and other documents in the therapy files, falsely indicating that the therapists had provided therapy services to the Medicare beneficiaries on those dates.

During the course of the scheme, Jha admitted he signed approximately 336 fictitious physical therapy files indicating that he had provided physical therapy services to Medicare beneficiaries, when in fact he had not. Jha admitted that he was paid between $90 and $110 for each file that he falsified. Between approximately February 2003 and December 2005, Jha admitted that he falsified physical therapy files that supported claims to the Medicare program totaling approximately $1,680,000. Medicare actually paid approximately $772,800 on those claims. Jha admitted that, throughout the conspiracy, he was fully aware that Medicare was being billed for physical therapy services that he falsely indicated he had performed.

The case is being prosecuted by Trial Attorneys John K. Neal and Benjamin D. Singer of the Criminal Division’s Fraud Section and by Special Assistant U.S. Attorney Thomas W. Beimers of the Eastern District of Michigan. The FBI and the HHS Office of Inspector General (HHS-OIG) conducted the investigation. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.

Since the inception of Strike Force operations in March 2007—Miami (Phase One), Los Angeles (Phase Two), Detroit (Phase Three), and Houston (Phase Four)—the Strike Force has obtained indictments of more than 293 individuals and organizations that collectively have billed the Medicare program for more than $680 million. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

Each of the Strike Force teams across the separate phases are led by a federal prosecutor from the Criminal Division’s Fraud Section or the U.S. Attorney’s Office. Each team has an agent from the FBI and HHS-OIG.

To learn more about the HEAT team, go to: www.stopmedicarefraud.gov