Detroit-Area Physical Therapist and Physician’s Assistant Plead Guilty in Medicare Home Health Fraud Scheme

Patient Recruiter Sentenced to Two Years in Prison for Participating in Separate Fraud Scheme

WASHINGTON—Detroit-area residents Faisal Chaudry and Guy Ross pleaded guilty today in U.S. District Court in Detroit for their participation in a fraudulent Medicare home health scheme, the Departments of Justice and Health and Human Services (HHS) announced. Also today, a Detroit-area patient recruiter was sentenced to two years in prison for his role in a separate Medicare fraud scheme.

Chaudry, 32, pleaded guilty before U.S. District Court Judge Denise Page Hood in the Eastern District of Michigan to one count of conspiracy to commit health care fraud. Ross, 49, pleaded guilty before Judge Hood to one count of conspiracy to receive health care kickbacks. At sentencing, scheduled for Oct. 21, 2010, Chaudry faces a maximum penalty of 10 years in prison and a $250,000 fine; Ross faces a maximum penalty of five years in prison and a $250,000 fine.

According to the plea documents, Chaudry was a physical therapy assistant who worked for All American Home Care Inc., and other affiliated entities. All American purported to provide home health services, including physical therapy services, to Medicare beneficiaries. Chaudry admitted that he signed documents, including therapy visit and revisit notes, that purported to document home health visits to Medicare beneficiaries. The documents were then used by All American to bill Medicare. Chaudry admitted in court documents that a large majority of these home health visits never occurred. Chaudry also admitted that he was paid approximately $45 by the owners of All American for each document he signed. According to court documents, Chaudry signed documents used to justify approximately $917,394 in home health claims by All American for patients he either never saw or for whom home health services were medically unnecessary. Chaudry admitted that he knew the files he helped falsify were used to justify fraudulent billings to Medicare.

Ross, a medical assistant, admitted that he received kickbacks from the owners and operators of Patient Choice Home Healthcare Inc., and All American in exchange for referring home health patients to those entities. Ross admitted to receiving $500 per patient, paid either by check or in cash, in exchange for providing co-conspirator Mohammed Shahab with Medicare beneficiary information for various patients he recruited. After paying the kickbacks to Ross, Shahab, an owner of Patient Choice and All-American, billed Medicare for home health visits purportedly made to the beneficiaries recruited by Ross. During the course of the conspiracy, Ross referred 21 patients to Patient Choice and All American. Shahab pleaded guilty in February 2010 to health care fraud charges in connection with this case.

According to court documents, Ross also admitted to engaging in a similar scheme with a home health agency called Visiting Nurses Services (VNS), also a home health agency that purportedly provided physical therapy services. Ross admitted he accepted money in exchange for providing patient referrals to VNS. According to court documents, Ross referred approximately 80 patients to VNS and VNS submitted claims for $300,050 as a result of those referrals. In total, Ross’s kickback arrangements with these home health agencies resulted in $472,623 in improper benefits paid by Medicare to the home health agencies.

In a separate health care fraud case in Detroit, patient recruiter Dwight Armstrong was sentenced by U.S. District Court Judge Lawrence Zatkoff to serve two years in prison and three years of supervised release. Armstrong was also ordered to pay $250,000 in restitution. Armstrong, 32, pleaded guilty on April 8, 2010, to one count of conspiracy to commit health care fraud. According to the plea documents, Armstrong began recruiting patients for Careplus LLC in approximately June 2008. Armstrong admitted that he paid kickbacks to the Medicare beneficiaries he recruited, and later transported, to Careplus using money provided by the owners and operators of Careplus. Armstrong admitted he kept part of the funds he received as a kickback for referring the Medicare beneficiaries he recruited. According to court documents, the owners and operators of Careplus typically paid $100-$150 per patient Armstrong recruited, with Armstrong retaining $50-$75 of that amount as a kickback for the referral. Armstrong also admitted he instructed the beneficiaries he recruited, based on instructions from the owners and operators of Careplus, to claim they had certain symptoms to trigger medically unnecessary tests.

Today’s guilty pleas and sentencing were announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.

These cases were prosecuted by Assistant Chief John K. Neal and Trial Attorney Gejaa T. Gobena of the Criminal Division’s Fraud Section. The cases were investigated by the FBI and HHS-OIG, and were 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 Eastern District of Michigan.

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 635 individuals who collectively have falsely billed the Medicare program for more than $1.4 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.