Yesterday, U.S. District Court Judge Patricia A. Seitz sentenced Ariel Delgado, a Miami DME owner, to 30 months in prison, to be followed by three years of supervised release. The defendant was also ordered to forfeit $474,609 and pay restitution in the amount of $170,709.
According to the Indictment and the factual proffer read in open court at the time of the plea, on January 10, 2008, defendant Delgado became the president and registered agent of Caballero De Paris Inc. (hereinafter “Caballero”), a pharmacy purportedly doing business in Miami-Dade County. From January 10, 2008 through March 5, 2008, Caballero billed Medicare $1,388,051. Medicare paid Caballero $645,318 on these claims. Delgado was the sole signatory on the account into which all of the Medicare fraud proceeds were deposited.
The two doctors who appeared to have signed 80% of the prescriptions upon which Caballero’s false billings were based. Both doctors reviewed a list of the patients on whose behalf Caballero had billed and denied treating or prescribing medicine to any of the patients on the list.
Delgado’s attorney argued urged the court make a determination that the calculation for loss suffered under the advisory sentencing guidelines was equal to or less than the amount of money actually paid by Medicare – $170,709 – minus 2 levels for a role adjustment for acting as minor participant less 3 levels for acceptance of responsibility resulting on a level 11 (8-14 months) in Zone C of the guidelines.
Monthly Archives: August 2008
DME DEFENDANTS SENTENCED IN $492M MEDICARE FRAUD SCHEME
MIAMI, FL (August 28, 2008) – Defendants Mabel and Abner Diaz, of Miami Lakes, FL were each sentenced today to fourteen years’ incarceration for conspiracy to commit health care fraud and health care fraud. Defendant Suleidy Cano, of Hialeah, FL was sentenced to eleven years’ incarceration for conspiracy to commit health care fraud and aggravated identity theft.
According to the parties’ joint factual statement in support of the plea, the fraud involved durable medical equipment (DME), which is equipment that can be used in the home on a repeated basis for a medical purpose. Where DME is prescribed or ordered by a physician, an authorized Medicare provider who supplies the equipment to a Medicare beneficiary may be eligible for reimbursement by Medicare.
Abner Diaz and Mabel Diaz co-owned and operated All-Med Billing Corp., a Miami medical billing company, where Cano worked as a biller. All-Med submitted claims to Medicare on behalf of suppliers who purportedly provided DME to Medicare beneficiaries. All-Med submitted $419,935,692.74 in fraudulent claims for DME purportedly provided to Medicare beneficiaries by 85 DME suppliers. These claims were for equipment that not been ordered by physicians or delivered to the beneficiaries as claimed. As a result of these claims, Medicare paid the suppliers approximately $148,586,919.99.
$211,000,000 INTERNET PHARMACY CASE
Exclusive COVERAGE BY Health CareFraud Blog
DALLAS, TX (August 27, 2008) – The federal government’s largest health fraud case involving online pharmacies was scheduled to conclude today with the sentencing of Ryokesh Johar Saran (Joe Saran) before US District Judge Jorge A. Solis in the Northern District of Texas. Saran as well and the 30 corporations he controlled were scheduled for sentencing. Sentencing for the corporate and individual defendants was indefinitely postponed due to the apparent heart attack Saran suffered en route to court.
Benson Weintraub, the nationally renown federal sentencing expert and a former full-time professor of law along with publisher of the Health Care Fraud Blog, Robert Malove, both of Fort Lauderdale have represented Saran and the corporate defendants for more than two-years and have been mounting a virtually unprecedented course of complex presentece litigation. The defense has challenged the criminalization of Group Purchasing Organizations (GPO), comparing it to “pharmaceutical arbitrage” according to recent defense pleadings.
Though the government’s theory of “intended loss” reflects a gross exaggeration of loss, artificially inflating the sentencing range called for by the advisory United States Sentencing Guidelines. The amount of restitution, $69,000, better reflects the relative severity of the offense behavior caused by Saran and 30 individual codefendants,
The case was launched by the US Attorney General’s office with much fanfare, but Saran, the lead defendant and virtually only one not yet sentenced, has challenged the methodology by which the government arrived at its loss calculations, particularly in view of the “actual loss” associated with the Mandatory Victim Restitution Act (MVRA).
Defense lawyers and US Attorneys are tracking the Saran case as a benchmark in health care fraud sentencing litigation based on the novel issues presented by his counsel. Similar theories of “loss” asserted by the DOJ Trial Attorneys from Washington were recently rejected by two federal judges in Miami before whom Weintraub and Malove recently prevailed at sentencing.
The defense issued subpoenas for agents of the FBI and FDA as part of it’s reaction to the prosecution’ failure to abide by its earlier commitment to turn over all Brady material in mitigation of punishment. The government moved to quash the subpoenas and that litigation, too, is still in progress. The defense preemptively filed a motion to enforce the government’s promise made one-year ago of an incremental turnover of Brady materials and the defendant’s statements. Parenthetically, Chad Meacham, lead counsel for the Dallas US Attorneys office, repudiated the discovery stipulation reached between the defense and his predecessor, Bill McMurrey, now a partner at the Dallas office of Bracewell and Giuliani.
Inspector General’s Draft Report Says Medicare’s Claims of Reduced Improper Payments Misleading
Today, The New York Times reported that “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.”
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