Miami - Medicare fraud capital of the country

The top growth jobs right now in South Florida are in health care and government. Healthcare according to data from the Centers for Medicare and Medicaid Services (CMS), Miami-Dade County alone accounted for more paid DME (durable medical equipment) claims than 44 other states.  
Only some of the most populous states in the country including California, Texas, New York, Michigan, and Ohio billed Medicare for more than Miami-Dade County. According to that same data, an average Medicare patient in Miami-Dade County allegedly receives $6,200 worth of DME every year based on paid amounts; whereas patients throughout the rest of the United States average approximately $1,200 per year.

Do we really take care of our sick a weary? To an extent yes, Miami Dade taxpayers pay for indigent population’s healthcare and nobody is turned away from the County’s Jackson Health System Hospitals. They have access to some of the best doctors and medical technology from the University of Miami. But Miami has also become the Medicare fraud capital of the country. A Medicare Strike Force has been established and is led by Deputy Chief Ogrosky of the Fraud Section of the Criminal Division in D.C., and the office of U.S. Attorney R. Alexander Acosta of the Southern District of Florida. The Strike Force operates out of the federal Health Care Fraud Facility in Miramar, Florida. Since March 1, 2007, the Strike Force has brought charges against 120 defendants, resulting in 101 convictions.
In January 2008 Cesar Romero was sentenced to forty-six months in jail for his role in a multi-million dollar Medicare billing fraud scheme on which Romero previously had pled guilty.

Romero took part in a scheme in which a phantom health clinic, named “The Real Group & Associates, Inc.,” was incorporated in South Florida and subsequently billed Medicare for reimbursement for non-existent drug infusion and injection therapies typically prescribed to AIDS and  chemotherapy patients. Nearly $17 million of false claims were submitted to Medicare for reimbursement, resulting in payments of more than $2.5 million on the false claims.

Nine more defendants were sentenced in Miami in January:

(1) Luis Soto, 41, sentenced to 87 months in prison by U.S. District Judge Marcia G. Cooke on January 23, 2008.  Soto owned and operated Ocean Medical Equipment, Adriana Medical Supply, Advance Medical Equipment, Family Health Medical Equipment, First AA Medical, KB Medical Services, Rossmary Medical Supplies, R&R Medical Equipment, Sagua Medical Supplies, Telimay Medical Service, West Side Medical, Future Medical Center, Siboney Medical Center, and Tampa Trauma that billed for items such as oxygen concentrators, nebulizers and wheelchairs that were never provided. Soto submitted claims to Medicare for unnecessary medical equipment and he caused the submission of false claims for pharmaceuticals.  In total, Soto, through his companies, was responsible for over $47 million in false claims to Medicare.  Soto pleaded guilty on October 16, 2007.

(2) Noel Rodriguez, 50, sentenced to 51 months in prison by U.S. District Judge James Lawrence King on January 16, 2008.  Rodriguez owned and operated OxyCare of Miami, a fraudulent DME company that had nothing to do with providing health care or necessary medical equipment. Between September of 2001 and June of 2003, OxyCare submitted claims to Medicare for medical equipment largely consisting of unnecessary oxygen concentrators, hospital beds and pressure reducing mattresses. Further, Rodriguez caused the submission of false claims for pharmaceuticals.  
In total, Rodriguez, through his companies, was responsible for over $1.2 million in false claims to Medicare.  Rodriguez pleaded guilty on October 10, 2007.

(3) Rosabel Gonzalez, 32, the owner and operator of Genesis Associates Group, Inc., was sentenced to 30 months in prison by U.S. District Judge Donald L. Graham on January 10, 2008.  Genesis was a fraudulent DME company that had nothing to do with providing health care or necessary medical equipment. Gonzalez submitted over $1.5 million in false claims to Medicare largely consisting of unnecessary power pressure reducing mattresses and orthotics. Gonzalez pleaded guilty on November 2, 2007.

(4) Christian Vasquez, the named owner of Tamiami Medical Supply, Inc., was sentenced to 41 months in prison by U.S. District Judge Joan A. Lenard on January 16, 2008.  Tamiami was a fraudulent DME company that had nothing to do with providing health care or necessary medical equipment.  Tamiami submitted over $1.2 million in false claims to Medicare.  The previous named owner of Tamiami, Justo Padron, 36, died in November of 2007 after an alligator attack at the Miccosukee Tribe Indian Reservation.  Vasquez pleaded guilty on October 22, 2007.

(5) Maria De La Serna, 55, sentenced to 19 months in prison by U.S. District Marcia G. Cooke on January 23, 2008. De La Serna owned and operated Respiratory One Equipment, Inc., a fraudulent DME company that had nothing to do with providing health care or necessary medical equipment. Between September of 2001 and June of 2003, Respiratory One submitted claims to Medicare for medical equipment largely consisting of unnecessary oxygen concentrators and nebulizers. Further, De La Serna caused the submission of false claims for pharmaceuticals.  In total, De La Serna was responsible for over $345,000 in false claim to Medicare.  De La Serna pleaded guilty on November 15, 2007.

(6) Ariel Betancourt, 35, the named owner of Lincoln Medical Supply, was sentenced to 24 months in prison by U.S. District Judge James Lawrence King on January 16, 2008.  Lincoln Medical was a fraudulent DME company that had nothing to do with providing health care or necessary medical equipment.  Lincoln Medical submitted over $480,000 in false claims to Medicare for largely unnecessary equipment such as wound therapy pumps and expensive wound care items. Betancourt pleaded guilty on November 15, 2007.

(7) Jose Prieto, 58, sentenced to 41 months in prison; (8) Armando Jorge Herrera, 27, sentenced to 36 months in prison by U.S. District Judge Jose A. Gonzalez for their involvement on January 18, 2008.  Prieto and Herrera were owners and operators of Coral Way Medical, a fraudulent HIV infusion clinic that also billed for unnecessary procedures such as paravertebral joint injections.  Prieto and Herrera used these two companies to submit over $900,000 in fraudulent Medicare claims. Prieto pleaded guilty on November 15, 2007.  Herrera pleaded guilty on November 1, 2007.

(9) Reinaldo Lopez, 40, the owner and operator of Reny Medical Equipment, was sentenced to 46 months in prison by U.S. District Judge Marcia G. Cooke on January 23, 2008.  Reny Medical was a fraudulent DME company that had nothing to do with providing health care or necessary medical equipment. Lopez submitted over $450,000 in false claims to Medicare for unnecessary items such as prosthetics and ostomy supplies. Lopez pleaded guilty on November 7, 2007.

Also in January a federal jury in Miami convicted a physician and the owners and operators of two durable medical equipment companies and a home health care agency of Medicare fraud.

After a five week trial in Miami, the jury found Maria T. Hernandez (Mayte), 50, Marta F. Jimenez, 67, Maivi Rodriguez, 34, and Ana Caos, M.D., 62, guilty on all charged counts, including; conspiracy to defraud the U.S. government, to cause the submission of false claims to Medicare, and to solicit and receive kickbacks; and conspiracy to commit health care fraud. Additionally, defendants Hernandez, Jimenez and Rodriguez were found guilty on six counts of receiving kickbacks in exchange for referring Medicare patients.

At trial, the jury heard testimony from patients, controlled by Hernandez, Jimenez and Rodriguez through their companies, that they were falsely diagnosed with chronic obstructive pulmonary disease and prescribed unnecessary aerosol medications, including compounded medications delivered by Miami-area pharmacies. Compounding refers to the process of a pharmacist mixing the medication in the pharmacy, instead of purchasing it from a pharmaceutical manufacturer.  Testimony revealed that one of the men making the medicine at the pharmacies, was unlicensed and had been trained as an auto mechanic.

As part of this scheme, Hernandez, Jimenez and Rodriguez controlled more than sixty Medicare patients. Between February 2001 and June 2003,  Medicare was billed $487,783 by complicit pharmacies for unnecessary aerosol prescriptions for these patients. In exchange for bringing the prescriptions to the pharmacies, the defendants received approximately $150,000 dollars from the pharmacy owners, who have also been sentenced to federal prison. Between December 1997 and January 2007, the defendants directly billed Medicare more than $1.6 million dollars for medical equipment for these same patients.

Hernandez owned and operated Action Best Medical Supplies Inc., and Jimenez and Rodriguez owned and operated Esmar Medical Equipment Inc., both Miami durable medical equipment companies (DMEs). Rodriguez also owned and operated A & A Medical Services Inc., a home health care agency, and M & M Comprehensive Inc., an assisted living facility. Caos practiced at Larkin Community Hospital and operated a private practice.

The patients testified that they were paid cash kickbacks to accept delivery of the unnecessary medication and medical equipment that was billed to Medicare. One Medicare beneficiary testified that he donated all the medication to a charity while another testified that she threw it in the trash. Former physician, Pedro Cuni, who is serving time in prison for Medicare fraud, testified that he was paid $50 apiece to write prescriptions for the patients controlled by these defendants.

Trial evidence established that Caos wrote prescriptions for unnecessary compounded aerosol medication and its related medical equipment. The jury also heard testimony from Orlando Pascual, another company owner who is serving time for Medicare fraud, that he purchased prescriptions from Caos at $100 per prescription. These aerosol prescriptions were taken to the fraudulent pharmacies, which were shut down in June 2003 following raids by the FBI and U.S. Department of Health and Human Services’ Office of the Inspector General (HHS-OIG).

The court ordered a retrial based on issues that arose during Caos’ prior testimony.  In May a federal jury in Miami convicted dermatologist Ana Caos, M.D., of Medicare fraud.

After a nine-day trial in Miami, the jury found Caos, 62, guilty on all charged counts, including; conspiracy to defraud the U.S. government, to cause the submission of false claims to Medicare, and to solicit and receive kickbacks; and conspiracy to commit health care fraud. Sentencing on this conviction has been scheduled for July 18, 2008. Caos faces a maximum of 15 years in prison.

At trial, the jury heard testimony from Caos’ patients that she wrote prescriptions for medications that the patients did not want or need, solely for the purpose of billing Medicare for the medications. The patients testified that they were falsely diagnosed with chronic obstructive pulmonary disease (COPD) and therefore prescribed unnecessary compounded aerosol medications that they threw in the trash immediately upon receipt.

An expert pulmonologist from the University of Miami Medical School testified that prescribing compounded aerosols for the treatment of COPD was unnecessary because there are numerous commercially available medications that can be prescribed. Compounding is the process of a pharmacist making medication as opposed to a pharmaceutical manufacturer.

As part of these conspiracies, Caos wrote unnecessary prescriptions for homemade compounded medicines for more than 40 patients. Between February 2001 and June 2003, Medicare was billed $620,000 by complicit pharmacies for unnecessary aerosol prescriptions; by complicit durable medical equipment (DME) companies for equipment used with those drugs; and for visits to Caos.

Another former physician, Pedro Cuni, who is currently serving time in prison for Medicare fraud, testified that Maria Hernandez, the owner of Action Best Medical Supplies Inc., informed him that she was utilizing Caos to write false prescriptions. The jury also heard testimony from Orlando Pascual, another company owner who is serving time in prison for Medicare fraud, that he purchased prescriptions from Caos at $100 per prescription.

In 2006, the Medicare program paid for more than $155 million worth of aerosol medications in Miami-Dade County alone. These drugs were the single most common item billed to Medicare Part B and accounted for more than 32 percent of all equipment claims filed in Miami-Dade County. 
From 2005 to 2006, claims for aerosol medications rose more than 100 percent in Miami-Dade County. In June 2007, the Centers for Medicare and Medicaid Services ceased paying for compounded aerosol medication because it determined that they were medically unnecessary.

January 2008 also saw the sentencing of Angel Castillo, Jr., 32, of Miami, by U.S. District Court Judge Adalberto Jordan to 235 months (19 years) in prison for his role in orchestrating a $7,000,000 health care fraud and money laundering scheme. In addition, Castillo was ordered to pay more than $7,200,000 in restitution to the Medicare program and was ordered to pay a $7,882,894 money judgment.

Angel Castillo, Jr. owned and controlled more than eight durable medical equipment companies in Miami during 2005 and 2006. The companies collectively submitted more than $48,000,000 in false claims using two medical billing companies. In reality, however, the companies never  provided any Medicare patients with any type of equipment or service. Moreover, Castillo used a series of nominee or “straw” owners to conceal his ownership of the companies.

After receiving more than $7,000,000 in Medicare payments, Angel Castillo, Jr. then laundered the proceeds of the scheme using friends, family and other associates, including various bank employees, to cash hundreds of checks. In some instances, Castillo’s associates needed duffel bags to carry the cash out of local banks.

Co-defendants Miguel A. Castillo, Michael Labrada, Giovanni Guerrero and Javier Roberto More had all pled guilty to related health care fraud and money laundering offenses in the previous months. Defendant Michael Labrada was also charged in a separate case involving another fraudulent company, JJ&D Medical Equipment, Inc., which submitted more than $5,000,000 in bogus equipment claims. Defendant Guerrero received a 37 month sentence and More received a 24 month sentence for putting Angel Castillo’s companies in their names and cashing checks.
On April 2, 2008 the Honorable Adalberto Jordan sentenced defendant Michael Labrada, 27, of Miami to a 97 month prison term and Miguel Castillo, 42, of Miami, to a 57 month prison term for their participation in the multi-million dollar health care fraud and money laundering scheme.

March 2008 saw the sentencing of defendant Adam Cruz to thirty-nine months in jail for his role in a multimillion dollar Medicare billing fraud scheme. Cruz had previously pled guilty to the scheme.

Cruz orchestrated a scheme in which he incorporated, owned, and operated a fraudulent durable medical equipment (“DME”) company, “Ameri-Health Services, Inc.,” and subsequently billed Medicare for reimbursement for non-existent DME items and services. In all, more than $10 million of false claims were submitted to Medicare for reimbursement, of which Medicare paid approximately $1.1 million.

March 18, 2008 defendant Leonardo Pita pled guilty to one count of health care fraud. According to the Indictment and the factual proffer read in open court during the plea, Pita was the president of L&L Medical Supply Corp., durable medical equipment (DME) company based in Miami-Dade County. From April 2003 through May of 2004, the defendant orchestrated a scheme to defraud Medicare by submitting claims to Medicare for services and equipment that were not, in fact, rendered to Medicare beneficiaries. During the course of the scheme, approximately $1 million in false claims were submitted, of which Medicare paid $519,000.

In May 2008 defendant Leonardo Pita was sentenced by U.S. District Court Judge Adalberto Jordan to 42 months in prison, followed by three years of supervised release. The defendant was also ordered to pay $519,305 in restitution.

In March 2008 two separate cases resulting from the operations of the Medicare Fraud Strike Force, defendant Juan Carlos Castaneda, 43, the owner and operator of International Surgical-Med Pharmaceuticals Corporation (International), a Miami pharmacy, was sentenced on March 28, 2008, to 63 months in prison by U.S. District Judge James I. Cohn in federal court in Miami. Jorge Novoa, 71, the owner and operator of Sunny Nutrition Services, Inc., Miami durable medical equipment (DME) company, was sentenced on March 27, 2008, to 56 months in prison by U.S. District Judge Donald L. Graham.

In July 2007, Castaneda had pleaded guilty, without a plea agreement, to all counts in an indictment that charged Castaneda with conspiring to pay cash kickbacks to 72 owners of DME companies in exchange for compounded aerosol medication prescriptions. Castaneda billed Medicare for these drugs through International and then kicked back 50 percent of the Medicare payments to the DME owners. At sentencing, the Court found that Castaneda received more than $4.5 million from Medicare and paid $2,040,500 in twice-monthly cash kickbacks to DME company owners as part of the scheme. 

In September 2007, Novoa had pleaded guilty to all charged counts in an indictment without a plea agreement.  That indictment charged that between February 1999 and February 2004, Novoa conspired to defraud the Medicare program through fraudulent claims and kickbacks in which he obtained Medicare cards and personal information from Medicare beneficiaries in order to submit fraudulent claims for unnecessary medical equipment and aerosol medications.  At sentencing, the court found that Novoa paid cash kickbacks of $70 to $200 to Dr. Zabdy Westerburger to obtain bogus prescriptions. These false prescriptions called for unnecessary medical equipment and related aerosol medications for the Medicare beneficiaries, who were given either a cursory examination or no examination at all. Dr. Westerburger was convicted of Medicare fraud in 2006. 

In April 2008 Juan Carlos Castaneda was indicted again along with Dilcia Marinez, 56, and Luis Frias, 60, the indictment alleged that between May 2003 and January 2004, the three conspired to submit approximately $14 million in false and fraudulent claims to the Medicare program for HIV infusion services allegedly provided at G&S Medical Center, an HIV infusion clinic operated by Castaneda, Marinez and Frias.  As part of the scheme, Castaneda, Marinez and Frias allegedly retained physicians and physicians’ assistants to work at G&S Medical to make it appear that legitimate HIV infusion services were being provided and hired a physician’s assistant to train the physicians to make it appear that legitimate and appropriate medical services were being provided.  Castaneda, Marinez and Frias would pay kickbacks to Medicare beneficiaries in exchange for the patients signing documents stating that they received the treatments being billed to Medicare.  Such treatments were not provided or medically necessary.  The indictment also alleges that Castaneda, Marinez and Frias laundered the proceeds of their crimes by sending the funds to sham management and marketing companies owned and controlled by their co-conspirators and by sending proceeds to companies they owned and controlled themselves.  Furthermore, the indictment alleged that Castaneda and Marinez structured financial transactions of less than $10,000 to avoid financial reporting requirements.

Castaneda, Marinez and Frias were charged with one count of conspiracy to defraud the United States, to cause the submission of false claims to the Medicare program, and to pay health care kickbacks; one count of conspiracy to commit health care fraud; and one count of conspiracy to launder the proceeds of their crimes.  In addition, Marinez was charged with five counts of money laundering, Frias with three counts of money laundering and Castaneda with two counts of money laundering.  Castaneda and Marinez were also each charged with three counts of structuring currency transactions for the purpose of evading reporting requirements.  If convicted, Castaneda faces a maximum of 90 years in prison, Marinez faces a maximum of 140 years in prison, and Frias faces a maximum of 85 years in prison.

Miami opened the month of April 2008 with the unsealing of eight separate Indictments charging six Miami Dade residents with health care fraud in connection with their use of patient information previously stolen from the Cleveland Clinic in Weston, Florida. The Indictments alleged that the defendants used the stolen patient information to submit fraudulent claims to Medicare. Specifically, the defendants are each charged with ten counts of health care fraud, in violation of 18 U.S.C. § 1347. If convicted of these charges, the defendants, owners of various clinics and DME companies, face up to ten years’ imprisonment on each count.

The Indictments unsealed on April 1st were the culmination of an investigation into the theft of computerized patient files from the Cleveland Clinic’s Weston Office from May 2005 to June 2006. In September 2006, defendant Isis Machado, an employee at the Cleveland Clinic’s Weston Office with access to computerized patient information, wrongfully accessed the Cleveland Clinic’s computerized patient files and downloaded the personal identification information of approximately 1,500 patients. This information included patients’ names, dates of birth, Social Security numbers, Medicare numbers, and home addresses. Machado then sold the patient information to her cousin, co-defendant Fernando Ferrer, for $5 to $10 per Medicare number or other individual identifying information. Co-defendant Ferrer, in turn, caused the stolen patient information to be used by DME’s and clinics for the submission of false claims to Medicare.

According to the Indictments, the fraudulently obtained Medicare numbers and identifying patient information were subsequently used by medical providers in Miami Dade-County to fraudulently bill Medicare about $7.96 million for medical services not rendered and medical equipment not supplied.

As the month of April moved along seven more Miami-area residents were indicted in connection with an $11 million Medicare fraud scheme involving HIV infusion clinics.

Dr. Ana Alvarez, 54, Mariela Rodriguez, 39, Aisa Perera, 42, Beatriz Delgado, 48, Angel Rodriguez, 40, Sandra Mateos, 43, and Carmen Gonzalez, 33, were all charged in the federal district court in Miami with: conspiracy to defraud the United States, to cause the submission of false claims, to pay health care kickbacks, and conspiracy to commit health care fraud. The indictment also sought forfeiture of assets held by all named defendants. Mariela Rodriguez, Perera, and Delgado also were charged with four counts of submitting false claims to the Medicare program. Alvarez also was charged with three counts of submitting false claims and Mariela Rodriguez was charged with one count of perjury.

According to the indictment, Mariela Rodriguez and Perera incorporated Saint Jude Rehab Center, Inc. (Saint Jude) in April 2003 as a medical clinic that purported to specialize in treating HIV patients. Delgado, a receptionist at Saint Jude, agreed to be incorrectly listed on filed corporate records as president and registered agent of Saint Jude. Mariela Rodriguez and Perera hired Dr. Alvarez to work at Saint Jude despite having no prior expertise in the clinic’s proclaimed specialty of treating HIV patients. Dr. Alvarez ordered unnecessary tests, signed medical analysis and diagnosis forms, and authorized treatments without regard to medical necessity, to make it appear that legitimate medical services were being provided to HIV patients receiving Medicare benefits.

The indictment further charged that during the conspiracy, Mariela Rodriguez, Perera, and Delgado withdrew cash from Saint Jude’s bank account for Angel Rodriguez, Mateos and Gonzalez, assistants at Saint Jude, to pay cash kickbacks of approximately $100 to $150 per visit to HIV patients. In return for the kickbacks, patients signed logs stating that they had received the treatments that were billed to Medicare, when in fact the patients had not received the claimed treatments.

From June 2003 through November 2003, Saint Jude billed approximately $11 million to the Medicare program under the Medicare provider numbers of Dr. Alvarez and Dr. Orestes Alvarez-Jacinto, receiving more than $8 million in payments for HIV infusion services that were not actually provided and services that were not medically necessary.

Dr. Orestes-Alvarez Jacinto, a former doctor at Saint Jude, pleaded guilty in June 2007 to conspiracy to commit health care fraud and was sentenced in October 2007 to 18 months in prison. In a related case, Rita Campos Ramirez, the medical biller employed by Saint Jude, pleaded guilty in August 2007 to a $170 million conspiracy to commit health care fraud. 

An indictment is merely a charge and defendants are presumed innocent until proven guilty.

In April 2008 Miami resident Rita Campos Ramirez, 60, was sentenced to 10 years in prison for her role in a $170 million scheme to defraud Medicare. The scheme represented the largest known individual case of Medicare fraud in the history of the program.

Campos was sentenced in the U.S. District Court for the Southern District of Florida by Judge Alan S. Gold. In addition to the prison sentence, Judge Gold ordered that the defendant be placed on three years of supervised release following her release from prison; forfeit $207,000, her three homes and an automobile; and pay $105 million in restitution to the U.S. Department of Health and Human Services.

Campos pleaded guilty on Aug. 28, 2007, to one count of conspiracy to commit health care fraud and one count of submitting false claims to Medicare. As part of her plea, Campos admitted that between October 2002 and April 2006 she owned and operated R&I Medical Billing Inc., a medical billing company that specialized in submitting bills to the Medicare program on behalf of HIV infusion clinics. Campos admitted that she knowingly submitted approximately $170 million in fraudulent medical bills to Medicare on behalf of 75 HIV infusion clinics in Miami-Dade County that were part of the scheme. Infusion clinics serve HIV patients by providing prescribed medications intravenously.

The Medicare program paid approximately $105 million of the $170 million in fraudulent bills submitted by Campos, with Campos personally receiving $5 million for her role in the fraud.

Co-conspirators, Giovanni Guerrero, Javier Roberto More, Angel Hernandez, and Juan A. Zaragoza have all pled guilty to related health care fraud and money laundering offenses in the past months. The case is being prosecuted by Special Assistant United States Attorney William J. Parente Jr. of the Federal Bureau of Investigation.

Arthur Vanmoor Case

Arthur Vanmoor was sentenced by United States District Court Judge Jose A. Gonzalez, Jr., in Ft. Lauderdale, Florida, on April 11, 2008, to a term of 210 months in prison and a term of 3 years of supervised release. He was also ordered to pay a special assessment in the amount of $1,900.00. VANMOOR’s was convicted on January 18, 2008, by a federal jury sitting in Fort Lauderdale of 19 separate counts that included Conspiracy to Commit Mail Fraud, Wire Fraud, Misbranding of Drugs and the Introduction of Unapproved New Drugs into Interstate Commerce.

The evidence at trial revealed that VANMOOR hired individuals to create and write content for web sites with names such as www.cancercure.org and www.migrainemiracle.com to promote his products, “Cancer Control” and “Migraine Miracle,” by falsely claiming, among other things, that the products were FDA approved drugs guaranteed to cure numerous forms of cancer and migraine headaches. VANMOOR further arranged for the web sites to contain fake articles purportedly written by doctors. These fake articles were accompanied by pictures of people dressed like doctors holding the products as well as fictitious patient testimonials recommending the products.

In December of 2005, the United States Attorney’s Office obtained a temporary restraining order against VANMOOR and others prohibiting the continued promotion, advertisement, production, shipment, and/or sale of “Cancer Control,” “Migraine Miracle,” “Flu Fighter,” and any other non-FDA-approved drugs in interstate commerce. VANMOOR nevertheless continued to maintain his web sites and calling lines after the entry of the temporary restraining order. The court in the civil case found VANMOOR to be in civil contempt, and in January 2006 the United States  indicted VANMOOR for criminal contempt as well as conspiracy to commit mail fraud, wire fraud, misbranding of drugs and the introduction of unapproved new drugs into interstate commerce. In August 2007, VANMOOR was extradited to the United States from the Netherlands to face the charges in this case.

Gustavo Smith Case

A federal jury in Miami convicted the owner of a Miami pharmacy for his role in a $3 million Medicare fraud scheme and for money laundering.

After a six day trial in Miami, the jury found Gustavo Smith, 43, guilty of all 17 counts charged against him in the September 2007 indictment, including: conspiracy to defraud the U.S. government, to commit health care fraud, and to submit false claims to the Medicare program; seven counts of health care fraud; seven counts of submitting false claims to the Medicare program; conspiracy to commit money laundering; and one count of money laundering.

At trial, the jury heard testimony from patients whose names were used by Smith’s Medstar pharmacy to bill the Medicare program for durable medical equipment. The patients testified that they never received any equipment from Medstar and did not have a medical need for the equipment. The jury also heard testimony from several doctors who allegedly wrote prescriptions for the equipment being billed by Medstar.  These doctors testified that they never wrote the prescriptions in question and never prescribed the types of equipment being billed by Medstar.

As part of the scheme, over the course of approximately one year, Smith billed the Medicare program approximately $3 million for negative pressure wound pumps, wound care supplies and pharmaceuticals.

The jury also heard evidence that Smith owned and operated another company, Orthotics Fitters, through which he was billing the Medicare program for the same equipment being billed through Medstar. During 2006, Smith caused Orthotics Fitters to bill approximately $2.9 million in fraudulent claims for negative pressure wound pumps and wound care supplies that were never actually provided to Medicare beneficiaries.

Smith’s co-defendant, Friedhelm Schock, the nominee owner of Medstar, was acquitted on all charged counts.

Dr. Ronald Harris

One indictment alleged that between August 2002 and March 2004, Dr. Ronald Harris, 57, and Enrique Gonzalez, 62, conspired to submit approximately $24.5 million in false and fraudulent claims to the Medicare program for HIV infusion services allegedly provided at Physicians Med-Care and Physicians Health Med-Care, HIV infusion clinics that Harris and Gonzalez allegedly controlled.  Infusion clinics serve HIV patients by providing prescribed medications intravenously.  As part of the scheme, Gonzalez caused the payment of cash kickbacks to Medicare beneficiaries in exchange for the patients signing documents stating that they had received the treatments being billed to Medicare when such treatments were not provided and not medically necessary.  Harris worked as the doctor at Physicians Med-Care and Physicians Health Med-Care and would order unnecessary tests, sign medical forms and authorize treatments to make it appear that legitimate medical services were being provided to Medicare beneficiaries, when in reality the services were not actually provided and were not medically necessary.  The indictment also alleges that Harris and Gonzalez laundered the proceeds of their crimes by sending the proceeds to a purported medical company that was actually owned and controlled by Harris, Gonzalez and their co-conspirators.

Harris and Gonzalez were charged with one count of conspiracy to defraud the United States, to cause the submission of false claims to the Medicare program, and to pay health care kickbacks; one count of conspiracy to commit health care fraud; and one count of conspiracy to launder the proceeds of their crimes.  Harris was also charged with three counts of submitting false claims to the Medicare program

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