Physician Convicted in $375 Million 'Signature' Fraud

April 15, 2016

A jury in a federal district court on April 13 found a 58-year-old physician in suburban Dallas, Texas, guilty of orchestrating a scam that generated $375 million worth of Medicare and Medicaid billings for home health services patients did not need.

Prosecutors said it was the largest home health fraud a single physician has ever pulled off. And all it took was his signature, no matter who wrote it.

Jacques Roy, MD, was convicted of eight counts of healthcare fraud, one count of conspiracy to commit fraud, two counts of making false statements, and one count of obstruction of justice. Scheduled for sentencing this fall, Dr Roy could spend the rest of his life in prison.

Also found guilty of various fraud charges after the 6-week trial were the owners of two home health agencies prosecutors said had recruited fake patients with groceries, cash, and fast food for Dr Roy to certify for home care and then treat. To drum up business, agency employees canvassed from door to door and frequented a homeless shelter.

In all, Dr Roy's practice, called Medistat, fraudulently approved 11,000 Medicare beneficiaries to receive care from some 500 home health agencies between January 2006 and November 2011. Dr Roy and other clinicians affiliated with Medistat then would make unnecessary home visits and order unneeded services, such as skilled nursing. No other practice in the country certified more Medicare beneficiaries for home health or treated as many during that time, according to the Department of Justice, which called the number of patients involved "astronomical."

The "485 Department" Was a Signature Factory

For a Medicare beneficiary to be eligible for home health benefits, a clinician must complete CMS Form 485, called the Home Health Certification and Plan of Care. Medistat had its own "485 Department," in which employees worked all day handwriting Dr Roy's signature on the form or affixing an electronic one, said prosecutors.

"Dr Roy used his signature as a commodity," said assistant US Attorney Michael Elliott in one court filing.

At trial, prosecutors said the 485 Department engaged in forgery, but Marlo Cadeddu, an attorney for Dr Roy, said no rule barred the physician from authorizing his staff to sign forms on his behalf, according to the online publication Law360. Dr Roy's defense team told the jury that although he may not have followed all the Medicare regulations, he was not running a fraud machine, just putting in long hours caring for sick patients, Law360 reported in its trial coverage.

The jury deliberated 2 days before delivering its guilty verdict.

"We respectfully disagree with the jury's decision," Ali Fazel, another of Dr Roy's attorneys, said in an interview with Medscape Medical News. Fazel said 2 days of deliberation were not enough for the jury to properly review some 500 exhibits the government entered as evidence. "I can assure you there will be an appeal," he said.

"Michel Poulin" Planned to Flee, Said Prosecutors

Dr Roy has been in federal custody since his arrest in early 2012. The US district court in Dallas declared him a flight risk after prosecutors showed that the physician had created a fake identity — Michel Poulin — along with fake identification cards and overseas bank accounts. Dr Roy had gone to "considerable lengths" to hide the almost $19 million Medistat received from Medicare and Medicaid, according to the government.

Law enforcement agents searching his home also discovered a book titled Hide Your Assets and Disappear, A Step-by-Step Guide to Vanishing Without a Trace.

Three other defendants in the fraud case pleaded guilty before the trial: Cyprian Akamnonu and his wife, registered nurse Patricia Akamnonu, the owner of Ultimate Care Home Health Services, both pleaded guilty to one count of conspiracy to commit healthcare fraud. They are serving 10-year prison sentences. During a 5-year period, more than 75% of Ultimate Care's beneficiaries were certified by Dr Roy or another Medistat physician acting at his direction. These beneficiaries produced $43 million in billings for the company.

Teri Sivils, Medistat's office manager, also pleaded guilty to one count of conspiracy to commit healthcare fraud. She is scheduled for sentencing in June. Sivils testified for the government in the trial that just ended.

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