Jury Convicts Fresno, Calif., Patient Recruiter of Medicare Fraud in Power Wheelchair Scam

The case was prosecuted by Trial Attorney Jonathan Baum and Senior Trial Attorney Jerrob Duffy of the Criminal Division’s Fraud Section, and was investigated by the California Department of Justice and HHS-OIG. The case 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 Central District of California.

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 500 individuals who collectively have falsely billed the Medicare program for more than $1.1 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.

March 1, 2010 - A federal jury in Los Angeles convicted a Fresno woman late Friday after it found that she committed Medicare fraud by recruiting patients for the purpose of receiving unnecessary power wheelchairs, Assistant Attorney General Lanny A. Breuer of the Criminal Division; George S. Cardona, Acting U.S. Attorney for the Central District of California; Steven Martinez, Assistant Director In Charge of the FBI’s Los Angeles Field Office; and Glenn R. Ferry, Special Agent-in-Charge for the Los Angeles Region of the Office of Inspector General (OIG) for the Department of Health and Human Services (HHS) announced today.

After a one-week trial in federal court in Los Angeles, the jury found Maria Nela Moreno, 57, guilty on Feb. 26, 2010, of conspiracy to commit health care fraud and six counts of health care fraud. The evidence introduced at trial showed that Moreno solicited Medicare beneficiaries by meeting with groups of seniors and going door-to-door at low-income, senior living communities in Sanger and Parlier, Calif., near Fresno. Moreno recruited beneficiaries to receive expensive, high-end power wheelchairs that the beneficiaries did not need. Several beneficiaries testified that Moreno wore a badge with her picture on it that appeared to resemble a hospital identification badge.

According to the beneficiaries who testified at trial, Moreno tricked them into giving her their identification cards and Medicare insurance numbers by telling the beneficiaries that they should take a power wheelchair because Medicare would soon run out of money, and the beneficiaries would not be able to get a chair if the beneficiaries were to need them in the future. Moreno copied the beneficiaries’ identification cards and Medicare insurance numbers with the portable scanner she carried with her. Each of the power wheelchairs, which the evidence at trial showed could be purchased for less than $1,000 wholesale, resulted in approximately $6,000 in false claims to Medicare. Witnesses testified that at the Elderberry Apartments in Sanger, one of the locations where Moreno and her co-conspirators illegally recruited beneficiaries to receive power wheelchairs, many residents left the wheelchairs unused.

Witnesses testified at trial that they took the beneficiary information they received from Moreno to a fraudulent medical clinic in Los Angeles, which then used the information to create bogus prescriptions. Witnesses testified that they purchased the fraudulent power wheelchair prescriptions and medical documents from the clinic, and then sold them for more than $1,000 per prescription to durable medical equipment (DME) supply companies in and around Los Angeles. Moreno was in turn paid a kickback for each power wheelchair that the DME companies were able to fraudulently bill Medicare, using the beneficiary information Moreno obtained.

One of the DME supply companies that billed Medicare using the identities of Moreno’s recruits was Cooper Medical Supply of Canoga Park, Calif. Trial evidence established that between January 2006 and September 2009, Cooper Medical Supply submitted approximately $828,835 in false and fraudulent claims to Medicare, almost all of which were for power wheelchairs. Trial evidence established that additional DME companies across southern California also purchased prescriptions that were from the beneficiaries recruited by Mareno. Cooper Medical Supply’s owner, Ajibola Sadiqr, previously pleaded guilty to Medicare fraud. Sadiqr’s sentencing is scheduled for April 12, 2010.

U.S. District Court Judge John F. Walter of the Central District of Los Angeles scheduled sentencing for May 10, 2010. Moreno faces a maximum penalty of 10 years in prison and a $250,000 fine for each count of conspiracy and health care fraud for which she was convicted.

The case was prosecuted by Trial Attorney Jonathan Baum and Senior Trial Attorney Jerrob Duffy of the Criminal Division’s Fraud Section, and was investigated by the California Department of Justice and HHS-OIG. The case 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 Central District of California.

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 500 individuals who collectively have falsely billed the Medicare program for more than $1.1 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.