June 15, 12

NEWS / Owner and Operator of Halfway House Company Pleads Guilty to Role in Medicare Fraud Schem

WASHINGTON—The owner and operator of New Way Recovery Inc., a Florida corporation that operated several halfway houses, pleaded guilty today in Miami to a criminal charge related to a $205 million Medicare fraud scheme involving fraudulent claims for purported partial hospitalization program (PHP) services, the Justice Department, the FBI, and the Department of Health and Human Services announced today.

Hassan Collins, 41, pleaded guilty to one count of conspiracy to receive and pay health care fraud kickbacks before U.S. Magistrate Judge Edwin G. Torres.

According to court documents, from in or about April 2004 through September 2010, Collins received kickback payments in exchange for referring Medicare beneficiaries to American Therapeutic Corporation (ATC), a Florida corporation that operated several purported Partial Hospitalization Programs (PHP) throughout Florida. He and his co-conspirators caused false and fraudulent claims to be submitted to Medicare for PHP services purportedly provided at ATC’s locations, when, in fact, the services were never provided.

According to the plea agreement, Collins’s participation in the fraud resulted in more than $2.4 million in fraudulent billing to the Medicare program. At sentencing, scheduled for September 6, 2012, Collins faces a maximum sentence of five years in prison.

In related cases, more than 20 individuals have been convicted for their roles in the ATC fraud scheme. In 2011, ATC executives Lawrence Duran, Marianella Valera, and Judith Negron were sentenced to 50 years, 35 years, and 35 years, respectively, for their roles in the scheme. These sentences are the three longest prison sentences ever imposed in a Medicare Fraud Strike Force case. ATC and Medlink pleaded guilty to conspiracy to commit health care fraud. ATC also pleaded guilty to conspiracy to defraud the United States and to pay and receive illegal health care kickbacks. The corporations were sentenced to five years of probation per count and ordered to pay restitution of $87 million. Both corporations have been defunct since their owners were arrested in October 2010. Acevedo, a marketer for ATC, was sentenced to 91 months in prison.

This case is being prosecuted by Trial Attorneys Allan J. Medina, Steven Kim and William Parente of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS Office of Inspector General (HHS-OIG) and 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 Southern District of Florida.

Since its inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,330 defendants that collectively have billed the Medicare program for more than $4 billion. 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.

http://www.fbi.gov/miami/press-releases/2012/owner-and-operator-of-halfway-house-company-pleads-guilty-to-role-in-medicare-fraud-scheme

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