Corporate Compliance

Detroit therapy clinic owner and VP convicted in $23M Medicare fraud scheme

Compliance Monitor, June 30, 2010

A Detroit federal jury convicted the owner and the vice president of a physical therapy clinic for their roles in a $23 million Medicare fraud scheme, according to a Department of Justice (DOJ) press release.

According to the DOJ, Bernice Brown, owner of Wayne County Therapeutic Inc. (WCT), a purported outpatient clinic that specialized in physical and occupational therapy, and Daniel Smorynski, WCT vice president were involved in a number of illegal activities, including:

  • Purchasing fake therapy files from third-party contractors
  • Instructing staff therapists to create false documents
  • Purporting to provide services, when no such actions were provided
  • Paying cash-kickbacks to Medicare beneficiaries for their numbers and signatures

WCT submitted approximately $23.2 million in fraudulent claims to Medicare. Medicare paid approximately $6.5 million of those claims.

Brown and Smorynski face a maximum penalty of 10 years in prison and a $250,000 fine for each count of conspiracy to commit healthcare fraud (one) and counts of healthcare fraud (10).

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