31 May 2012

Six Pinoys in US Medicare Fraud

Medicare Fraud
If there’s one thing the Filipino Overseas Workers (OFWs) hate is if when fellow pinoys tarnish their image abroad. This is what happened when U.S. Federal Law Officials recently indicted 11 new defendants among them several Filipinos in Illinois to a federal indictment alleging they were part of a group defrauding Medicare of at least US$ 20 million over the past five years.

Federal officials reported that they found enough evidence showing that the 11 new defendants conspired with the initial defendant, Jacinto "John" Gabriel Jr., to submit millions of dollars in false claims for reimbursement of home health care services purportedly provided to Medicare beneficiaries. These services appeared to have not been provided at all or were not medically necessary.

"Gabriel and his co-schemers allegedly used the proceeds for various purposes, including using cash to gamble at casinos in the Chicago area and Las Vegas; to buy automobiles, jewelry; to purchase real estate in the United States and the Philippines; to perpetuate the businesses by paying his employees and providing them with gifts; and to bribe physicians and pay kickbacks to others in exchange for patient referrals," the US Department of Justice said in a statement.

The 44-year-old Gabriel has been charged with one count of health care fraud conspiracy, 43 counts of health care fraud, 11 counts of money laundering, and four counts of federal income tax evasion, said Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois.

Gabriel, who was arrested and charged in February 2011, pleaded not guilty.

The six of the 11 new defendants added that were reported to be Filipinos are:

  1. Jassy Gabriel, 42, John Gabriel's brother, and a registered nurse. He was charged with one count of health care fraud conspiracy and one count of filing a false federal income tax return.
  2. Stella Lubaton, 46, a minority owner of Perpetual and an officer and administrator, as well as a registered nurse. She was charged with one count of health care fraud conspiracy, 16 counts of health care fraud, one count of filing a false federal income tax return, and one count of violating the medical anti-kickback statute.
  3. Nessli Reyes, 35, a registered nurse. She was charged with one count of health care fraud conspiracy and nine counts of health care fraud.
  4. Charito Dela Torre, 71, a physician, was charged with one count of health care fraud conspiracy, 12 counts of health care fraud, and three counts of federal income tax evasion.
  5. Ricardo Gonzales, 75, a physician, was charged with one count of health care fraud conspiracy, 19 counts of health care fraud, and one count of violating the medical anti-kickback statute.
  6. Rosalie Gonzales, 42, a registered nurse and Ricardo Gonzales’ daughter, was charged with one count of violating the medical anti-kickback statute.
According to the indictment, Gabriel did not identify himself as an owner, but exercised ownership and control over Perpetual Home Health, Inc., and Legacy Home Healthcare Services.

Federal officials allege that between May 2006 and January 2011, Perpetual submitted more than 14,000 Medicare claims seeking reimbursement for services allegedly provided to beneficiaries.

As a result of those claims, Perpetual received more than US$ 38 million in Medicare payments. Between 2008 and January 2011, Legacy submitted more than 2,000 claims for Medicare reimbursement and received more than US$ 6 million.

The indictment reported that neither Perpetual nor Legacy had any sources of revenue other than Medicare funds.

If found guilty, Gabriel and the other defendants face 10 to 20 years in federal prison. Hopefully, the Philippine Government will not waste time and resources helping them reduce this sentence nor ask for their transfer in Philippine prison. On the other hand, given the state of the country's prison system, maybe they would be worse off and suffer more if they spend their prison time here.