Cases in Court

On April 6, 2003, the AP reported the seizure of property from Boris Shpirt and Gregory Plotkin, the owner and former chairman of Greybor Medical Transportation Inc., as a result of a civil False Claims Act suit that claims they caused $4 million in false Medicare claims to be filed during a 4-year period. Federal prosecutors allege in the suit that, between 1998 and 2002, Greybor obtained over $8 million from Medicare, and that over half of these proceeds relate to false claims submitted for patients who were not eligible under Medicare's guidelines, or who were not actually transported. In addition, the government alleges that the company double billed Medicare at times. Both men were arrested last year on charges of conspiracy, health care fraud and money laundering. In that case, Plotkin pled guilty and awaits sentencing, while Shpirt is set for trial in July 2003. Among the seized property was a Beverly Hills mansion that belonged to Shpirt and his wife, a Bentley Continental convertible, a Porsche Carrera convertible, and an $80,000 men's diamond watch.

State Drops Charges Against Florida Pharmacist

Prosecutors have dropped all charges against Oyebode O. Oyetunji of Pembroke Pines, FL, who had been charged with nearly 175 counts regarding allegedly bogus prescriptions for the widely abused painkiller OxyContin, and other controlled substances. Oyetunji had been arrested at his home and subjected to a “perp walk” in front of television cameras in handcuffs before being jailed in lieu of $2.2 million bail. The charges were dropped, without explanation, during a routine court hearing before a Broward County Circuit Judge. While Oyetunji was awaiting trial, his pharmacy license was revoked, and his counsel announced that he would be seeking reinstatement of the license for his client. Amazingly, Oyetunji apparently is not embittered by the experience, and was quoted as saying that he had prayed for those who put him in jail: “God bless them. That's what the Bible says. Bless those who curse you. That includes prosecutors.”

Illinois Woman Helps Put Her Mother in Prison

Pharmacist Teresa Papolezy, who had been caught defrauding health programs by billing for prescriptions that were not prescribed, hiding assets, and cheating insurers of almost $400,000 in claims related to a fire at her home, received a reduced sentence of 6 months in federal prison because she had assisted Illinois state officials by being willing to testify against her mother on charges that her mother had conspired to kill Christine Dickerson (another daughter). This information was reported on April 1, 2003, in the St. Louis Post Dispatch.

Chiropractor Charged with Drug Diversion Violations

On April 1, 2003, the Tucson Citizen, Tucson, AZ, reported that Dr. Jeri B. Hassman, a pain management specialist in that city, was arrested at her practice on 108 charges that she had illegally prescribed pain medications, including morphine, methadone and Oxycontin, and had committed health care fraud by filing claims with TRICARE for which she was not entitled to payments, since chiropractic services are not covered by the program.

Health Care Fraud Charges Dismissed in Missouri

A federal judge has dismissed charges against Drs. Juanito Villahermosa and Raghavendra Adiga, as well as Joseph Nadeau, a physician's assistant. The men, who had worked at the MedClinic facility in Savanna, MO, had been charged earlier this year in an indictment for allegedly devising a scheme to defraud Medicare by submitting false claims and billings related to X-ray examinations and medically unnecessary office visits at the clinic. Last year, MedClinic paid $445,853 to resolve civil allegations covering the years 1996 to 1999. While dismissing the allegations, the government nevertheless proclaimed no wrongdoing.

Pharmaceutical Giant Receives Federal Subpoenas

GlaxoSmithKline PLC announced in a filing made in March with the Securities and Exchange Commission (SEC) that the company had been subpoenaed by the U.S. Attorney's Office for the District of Massachusetts to produce documents as to “any repackaging, re-labeling or private-label arrangements it has had or discussed with third parties from 1991 to the present.” The company indicated that the U.S. Attorney's Office is probing whether prices that GlaxoSmithKline charged for its products to third parties represented “best prices” for Medicaid. The company has also received subpoenas from, and indicates that it is cooperating with, the Office of the Inspector General (OIG) of the Department of Health and Human Services, and the Department of Justice (DOJ), as well the states of Texas and California.

Washington State Specialist Pleads Guilty to Mail Fraud

On March 27, 2003, the Seattle Times reported that William Couser, a prominent kidney specialist and faculty physician with the University of Washington pled guilty to one count of mail fraud for having submitted a fraudulent claim. According to the report, Couser had no plans to resign from the medical school's faculty. The plea related to a $124 bill sent to a private insurer in 1996 concerning dialysis treatment. Last year, in a civil fraud case, Couser admitted responsibility for causing $100,000 in claims to be sent to Medicare, Medicaid, and TRICARE for dialysis treatments provided when he was not present, and he agreed to repay that sum. As part of the criminal plea agreement, prosecutors recommended that Couser be allowed to keep his medical license, noting that “a 'significant portion' of the overbillings did not directly benefit Couser, but instead went to University of Washington Physicians, the nonprofit billing agency that collects patient fees for UW doctors.

HealthSouth Executives Implicated in Government Probe

Guilty pleas have been entered for the first time under new Sarbanes-Oxley Provisions. On April 5, 2003, the New York Times reported that Richard Scrushy, former Chief Executive Officer for HealthSouth Corporation, the largest provider of diagnostic imaging, outpatient surgery, and rehabilitation services with locations in 50 states and abroad, has been targeted by regulators for allegedly helping to overstate the company's earnings by more than $2 billion during the past 6 years. Bill Hicks, an SEC attorney, was quoted as stating that Scrushy “could be forced to pay $785 million or more if he loses a government lawsuit accusing him and the company of fraud,” and that “[i]t could go up if we find more insider trading or more profiting from the fraud.” Eight former HealthSouth executives have plead guilty so far, including pleas from both a former and the current financial officer of the chain in late March 2003, under the new Sarbanes-Oxley measures. See “Sarbanes Oxley Claims First CFO,” SmartPros (March 28, 2003).

Property of California Ambulance Operators Seized

On April 6, 2003, the AP reported the seizure of property from Boris Shpirt and Gregory Plotkin, the owner and former chairman of Greybor Medical Transportation Inc., as a result of a civil False Claims Act suit that claims they caused $4 million in false Medicare claims to be filed during a 4-year period. Federal prosecutors allege in the suit that, between 1998 and 2002, Greybor obtained over $8 million from Medicare, and that over half of these proceeds relate to false claims submitted for patients who were not eligible under Medicare's guidelines, or who were not actually transported. In addition, the government alleges that the company double billed Medicare at times. Both men were arrested last year on charges of conspiracy, health care fraud and money laundering. In that case, Plotkin pled guilty and awaits sentencing, while Shpirt is set for trial in July 2003. Among the seized property was a Beverly Hills mansion that belonged to Shpirt and his wife, a Bentley Continental convertible, a Porsche Carrera convertible, and an $80,000 men's diamond watch.

State Drops Charges Against Florida Pharmacist

Prosecutors have dropped all charges against Oyebode O. Oyetunji of Pembroke Pines, FL, who had been charged with nearly 175 counts regarding allegedly bogus prescriptions for the widely abused painkiller OxyContin, and other controlled substances. Oyetunji had been arrested at his home and subjected to a “perp walk” in front of television cameras in handcuffs before being jailed in lieu of $2.2 million bail. The charges were dropped, without explanation, during a routine court hearing before a Broward County Circuit Judge. While Oyetunji was awaiting trial, his pharmacy license was revoked, and his counsel announced that he would be seeking reinstatement of the license for his client. Amazingly, Oyetunji apparently is not embittered by the experience, and was quoted as saying that he had prayed for those who put him in jail: “God bless them. That's what the Bible says. Bless those who curse you. That includes prosecutors.”

Illinois Woman Helps Put Her Mother in Prison

Pharmacist Teresa Papolezy, who had been caught defrauding health programs by billing for prescriptions that were not prescribed, hiding assets, and cheating insurers of almost $400,000 in claims related to a fire at her home, received a reduced sentence of 6 months in federal prison because she had assisted Illinois state officials by being willing to testify against her mother on charges that her mother had conspired to kill Christine Dickerson (another daughter). This information was reported on April 1, 2003, in the St. Louis Post Dispatch.

Chiropractor Charged with Drug Diversion Violations

On April 1, 2003, the Tucson Citizen, Tucson, AZ, reported that Dr. Jeri B. Hassman, a pain management specialist in that city, was arrested at her practice on 108 charges that she had illegally prescribed pain medications, including morphine, methadone and Oxycontin, and had committed health care fraud by filing claims with TRICARE for which she was not entitled to payments, since chiropractic services are not covered by the program.

Health Care Fraud Charges Dismissed in Missouri

A federal judge has dismissed charges against Drs. Juanito Villahermosa and Raghavendra Adiga, as well as Joseph Nadeau, a physician's assistant. The men, who had worked at the MedClinic facility in Savanna, MO, had been charged earlier this year in an indictment for allegedly devising a scheme to defraud Medicare by submitting false claims and billings related to X-ray examinations and medically unnecessary office visits at the clinic. Last year, MedClinic paid $445,853 to resolve civil allegations covering the years 1996 to 1999. While dismissing the allegations, the government nevertheless proclaimed no wrongdoing.

Pharmaceutical Giant Receives Federal Subpoenas

GlaxoSmithKline PLC announced in a filing made in March with the Securities and Exchange Commission (SEC) that the company had been subpoenaed by the U.S. Attorney's Office for the District of Massachusetts to produce documents as to “any repackaging, re-labeling or private-label arrangements it has had or discussed with third parties from 1991 to the present.” The company indicated that the U.S. Attorney's Office is probing whether prices that GlaxoSmithKline charged for its products to third parties represented “best prices” for Medicaid. The company has also received subpoenas from, and indicates that it is cooperating with, the Office of the Inspector General (OIG) of the Department of Health and Human Services, and the Department of Justice (DOJ), as well the states of Texas and California.

Washington State Specialist Pleads Guilty to Mail Fraud

On March 27, 2003, the Seattle Times reported that William Couser, a prominent kidney specialist and faculty physician with the University of Washington pled guilty to one count of mail fraud for having submitted a fraudulent claim. According to the report, Couser had no plans to resign from the medical school's faculty. The plea related to a $124 bill sent to a private insurer in 1996 concerning dialysis treatment. Last year, in a civil fraud case, Couser admitted responsibility for causing $100,000 in claims to be sent to Medicare, Medicaid, and TRICARE for dialysis treatments provided when he was not present, and he agreed to repay that sum. As part of the criminal plea agreement, prosecutors recommended that Couser be allowed to keep his medical license, noting that “a 'significant portion' of the overbillings did not directly benefit Couser, but instead went to University of Washington Physicians, the nonprofit billing agency that collects patient fees for UW doctors.