Medicaid crime sweep nets 20 suspects in Florida's No. 1 crime

jweaver@MiamiHerald.comMay 13, 2014 

Law enforcement agents swept up some 30 Medicare fraud suspects early Tuesday — on top of about 20 arrests made Monday — in a two-day attack on South Florida’s No. 1 federal crime. Tuesday’s busts focused on operators of home healthcare agencies and patient recruiters who in separate schemes conspired to fleece millions of dollars from the vulnerable, taxpayer-funded Medicare program, federal authorities said. In numerous criminal cases, many of the defendants were charged with paying or receiving kickbacks to generate a steady supply of home-bound patients who, prosecutors say, didn’t need or receive the services. Medicare, which serves senior citizens and the disabled, reimbursed the home health agencies for the bogus care. U.S. Attorney Wifredo Ferrer scheduled a news conference for Tuesday afternoon to spotlight the ongoing scourge of Medicare fraud in South Florida, which has long been known as the nation’s capital of healthcare corruption. As part of an crackdown, the Justice Department also deployed agents to make Medicare fraud arrests Tuesday in other trouble spots around the country. Since 2007, the Justice Department has teamed up with the U.S. attorney’s office in Miami to prosecute upward of 1,500 defendants in South Florida, ranging from Medicare-licensed clinic operators and patient recruiters to doctors and nurses. Collectively, the vast majority have been convicted of filing more than $3 billion in false claims for medical equipment, drug-infusion services, home healthcare, physical therapy and mental health treatment. On Monday, the most prominent name among the newly arrested Medicare fraud suspects belonged to Dr. Barry Kaplowitz. The Aventura psychiatrist was among about 20 suspects charged with defrauding the Medicare program. Squads of agents led what has become a periodic take-down of alleged Medicare fraud offenders in South Florida. Kaplowitz served as the medical director of an outpatient mental health facility in Hollywood that federal prosecutors say generated $7.5 million in false claims for Medicare patients who did not need psychiatric treatment. So when Justice Department attorneys asked Magistrate Judge Patrick White to give the former Hollywood Pavilion doctor a bond of $300,000, he balked. The judge thought the amount was too low, and doubled it to $600,000 — and ordered Kaplowitz to make a nonrefundable down payment of $45,000 on the bond. “I think it’s worse for a doctor to be involved in healthcare fraud,” White declared. “It’s outrageous.” Kaplowitz’s defense attorney, Brian Bieber, argued the higher bond was unfair, claiming the doctor was paid only $1,250 a month for his part-time services over the course of four years at Hollywood Pavilion. But the judge would not budge. Afterward, Bieber described his client as a “well-respected” doctor who has properly treated thousands of patients in South Florida.

Kaplowitz, 53, was arrested along with Hollywood Pavilion’s former chief operating officer, Christopher Gabel, and an administrator responsible for admitting patients to HP’s inpatient facility, Melvin Hunter. Also charged was Tiffany Foster, a patient recruiter from Alabama. Kaplowitz, Gabel and Hunter were charged by Justice Department prosecutor Nicholas Surmacz with conspiring to commit healthcare fraud, wire fraud and related offenses. Gabel, Hunter and Foster were charged with conspiring to pay or receive kickbacks for delivering Medicare patients to Hollywood Pavilion.

The magistrate judge ordered the same high bond terms for Gabel, 61, as he did for Kaplowitz: $600,000, including a nonrefundable $45,000 down payment. Gabel’s defense attorney, Jeffrey Neiman, argued that his client, who lives in Davie, has longtime ties to the community. He said he would not flee before trial, noting that Gabel has been aware of the Hollywood Pavilion investigation for two years. He said Gabel made $150,000 a year as the Hollywood-based facility’s chief operating officer over a decade, and argued that he “didn’t directly profit” from the alleged scheme to defraud Medicare. Again, the judge was not swayed. Neiman declined to comment about his client. As for Hunter, accused of admitting Medicare patients who did not need psychiatric treatment, the judge was more lenient — but not much. The judge set his bond at $300,000 — but the Broward resident has to come up with a $15,000 nonrefundable down payment. Their arrests followed last year’s conviction of Hollywood Pavilion’s chief executive officer, Karen Kallen-Zury, who was found guilty along with three other employees of conspiring to bilk $67 million from Medicare by filing phony claims for mental health services from 2003 to 2012. Medicare was duped into paying $40 million to Hollywood Pavilion, which operated an inpatient hospital and outpatient program. A Miami federal jury found that Kallen-Zury and other employees covered up the scam by falsifying patient records to make their treatment look necessary, and fabricated marketing contracts with patient recruiters to make their services appear legitimate. The jury also found that Kallen-Zury and others paid kickbacks to recruiters who supplied Hollywood Pavilion with patients. At Kallen-Zury’s trial, Justice Department prosecutors described the Hollywood-based psychiatric facility as a “brothel of fraud.” For her leadership role, Kallen-Zury got, by far, the longest sentence: The former CEO, who once lived along the water in Lighthouse Point, was sentenced to 25 years in prison.

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