Corporate Compliance

Seventeenth defendant convicted in $15 million Medicare fraud scheme

Compliance Monitor, June 2, 2010

In California, a $15 million Medicare fraud scheme case has finally come to an end after the 17th defendant was convicted following six years of litigation, according to a Department of Justice (DOJ) press release.

Xinming Fu, MD, pleaded guilty May 17 to conspiracy to pay kickbacks and healthcare fraud in connection to a Medicare fraud scheme that supplied unnecessary respiratory treatments to the elderly and mentally ill. Herman Thomas, owner of a respiratory treatment program, recruited doctors who paid illegal kickbacks to marketers who in turn paid kickbacks to the owners and administrators of the board-and-care facilities, according to the DOJ. These facilities provided care to mentally ill and elderly Medicare beneficiaries via Thomas’s treatment programs.

Almost daily the respiratory therapists provided unnecessary treatments without physician supervision and outside of a physician’s office, both violations of Medicare regulations. Patients were enticed to undergo treatments with soda, candy, donuts, and cigarettes, according to the DOJ. The therapists often performed treatments in the facilities’ smoking rooms.

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