DOJ Busts $2.6 Million Medicare Fraud Scheme

Brittany M. Hughes | October 24, 2016
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The Department of Justice just busted a Los Angeles – based occupational therapist for committing more than $2.6 million in Medicare fraud by filing false claims.

By the time they caught up with the scheme, the DOJ said the U.S. Department of Health and Human Services had already shucked out about $1.86 million.

According to the charges, 38-year-old Keith Canlapan billed Medicare for services that the program didn’t cover under the guise of different therapies that the program would pay for. Other claims were filed for services Canlapan said he performed on dates when he wasn’t even in the country.

Canlapan further admitted that through JH Physical Therapy, he billed Medicare for occupational therapy services when no such services were provided to the Medicare beneficiaries.  Instead, the Medicare beneficiaries received massage and acupuncture services, which are not reimbursable under Medicare rules, he admitted.  In fact, on dates that Canlapan purportedly provided occupational services to Medicare beneficiaries at JH Physical Therapy, Canlapan was admittedly not present at JH Physical and instead was either out of the country or at his other places of employment on some of those dates. 

Canlapan pled guilty to the charges on Monday. His co-conspirators, fellow licensed therapist Roderick Concepcion and JH Physical Therapy owners Simon and Grace Hong, have also been charged for their roles in the scheme.

Also on Monday, the DOJ reached a settlement with Life Care Centers of America, who agreed to pay $145 million to resolve a claim that the Tennessee-based chain filed millions in medically unnecessary claims to Medicare between 2006 and 2013.

The announcements by the DOJ on Monday mark the fourth and fifth Medicare fraud schemes announced by the DOJ in October alone.

Less than a week after, the Justice Department on Oct. 4 busted 91 people across seven cities for filing a cumulative $430 million in fraudulent Medicare claims, including more than $230 million in fraudulent home health care services, more than $100 million in mental health care fraud and more than $49 million in fake ambulance transportation claims. It was the single largest-spanning Medicare fraud takedown in history.

Two days later, on Oct. 6, the owner of a medical supply company in L.A. was sentenced to five years in prison for fraudulently billing Medicare for about $4 million in claims, including for medically unnecessary wheelchairs, back and knee braces – some of which were never even given to the alleged beneficiaries.

On Oct. 7, 38-year-old Pilar Garcia Lorenzo was convicted of committing $2.5 million in health care fraud after submitting multiple fake and fraudulent claims to Medicare.  The claims, the DOJ stated, were for home health services that Lorenzo had never actually provided, along with some that hadn’t been legitimately prescribed by a licensed physician.

The DOJ reported that since January 2009, the department has recovered about $31.6 billion in fraudulent health care claims. Of that, more than $19.2 billion was recovered in cases involving fraud against federal health care programs, amounting to roughly $2.74 billion per year.

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