Adult Foster Care Facility Owners and Physical Therapist Plead Guilty in Medicare Home Health Fraud Scheme

Facility Owners Plead Guilty to Receiving Kickbacks; Physical Therapist Admits Falsifying Medical Records

May 13, 2010 - WASHINGTON—Detroit-area residents Tariq Chaudhary, Lura Barrett and Stephen Cartier pleaded guilty today for their participation in a fraudulent Medicare home health scheme, the Departments of Justice and Health and Human Services (HHS) announced.

Chaudhary, 37, pleaded guilty before U.S. District Court Judge Denise Page Hood in the Eastern District of Michigan to one count of conspiracy to commit health care fraud. Barrett, 72, and Cartier, 50, each pleaded guilty before Judge Hood to one count of conspiracy to receive kickbacks. At sentencing, scheduled for Sept. 23, 2010, Chaudhary faces a maximum penalty of 10 years in prison and a $250,000 fine. Barrett and Cartier, scheduled to be sentenced on Sept. 16, 2010, face a maximum penalty of five years in prison and a $250,000 fine.

According to the plea documents, Chaudhary was a physical therapy assistant and began working for All American Home Care Inc. and other affiliated entities (All American). All American purported to provide home health services, including physical therapy services, to Medicare beneficiaries. Chaudhary admitted that he signed documents, including therapy visit and revisit notes, that purported to document home health visits to Medicare beneficiaries that were then billed by All American to Medicare. Chaudhary admitted in court documents that a large majority of these home health visits never occurred. Chaudhary also admitted that he was paid approximately $45 by the owners of All American for each therapy visit form he signed. According to court documents, Chaudhary signed documents used to justify approximately $747,282 in home health claims by All American for patients he either never saw or for whom home health services were medically unnecessary. Chaudhary admitted that he knew that the files he helped falsify were used to justify fraudulent billings to Medicare.

Chaudhary also admitted in court documents that he laundered money on behalf of co-defendant Hassan Akhtar. According to court documents, Akhtar wrote checks to Chaudhary from All American’s bank accounts and directed Chaudhary to cash the checks, retain a small portion of the cash for himself and return the rest of the cash to Akhtar. Chaudhary admitted in court documents that he knew the All American accounts from which the checks were drawn contained proceeds of the fraudulent scheme described above. According to court documents, Akhtar’s and Chaudhary’s purpose in orchestrating these transactions was this to conceal the disbursement of funds from the fraudulent scheme to Akhtar.

According to plea documents, Cartier was the owner and/or operator of an adult foster care facility (AFC), Hilltop Estates Inc. Cartier admitted that he received kickbacks from Mohammed Shahab, the owner and/or operator of several home health agencies (HHA), in exchange for Medicare patient referrals. In 2008, Cartier accepted $5,000 from an individual acting on Shahab’s behalf in exchange for allowing Shahab to bill Medicare for home health services purportedly provided to residents at Cartier’s AFC. Cartier admitted that from April 2009 through August 2009, he accepted $2,000 in cash per month from Shahab in exchange for allowing Shahab to bill Medicare for home health services purportedly provided to residents at his AFC. Cartier admitted he knew that Shahab would bill Medicare for home health physical therapy visits purportedly made to the Medicare beneficiaries at Cartier’s facilities.

Over the course of the conspiracy, Cartier referred 13 patients to Shahab’s HHAs. During the time Cartier participated in the scheme, Shahab’s HHA, Patient Choice Home Healthcare, submitted claims for $159,531 in improper benefits from the Medicare program.

Barrett, the owner and/or operator of an AFC and two room and board facilities, admitted in court that she also solicited and received kickbacks from Shahab. Barrett admitted that Shahab offered to pay Barrett in exchange for the opportunity to bill Medicare for home health physical therapy sessions purportedly provided to beneficiaries residing at Barrett’s AFC and room and board facilities. Barrett admitted that she agreed to provide Medicare beneficiary referrals to Shahab’s HHAs in exchange for payments. Barrett admitted in court that she knew Medicare was billed for the patients she referred.

Shahab pleaded guilty on Feb. 17, 2010, to one count of conspiracy to commit health care fraud and is scheduled to be sentenced on June 17, 2010. Hassan Akhtar was charged in an indictment unsealed on Jan. 14, 2010, with conspiracy to commit health care fraud and money laundering. An indictment is merely a charge and defendants are presumed innocent until proven guilty.

Today’s result was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.

The case was prosecuted by Assistant Chief John K. Neal and Trial Attorney Gejaa T. Gobena of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 560 individuals who collectively have falsely billed the Medicare program for approximately $1.2 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.