Owners of Houston Health Care Company Sentenced to Prison for Medicare Fraud

WASHINGTON—Two owners of a Houston durable medical equipment (DME) company were each sentenced to prison today for their roles in a Medicare fraud scheme, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).

U.S. District Judge David Hittner in the Southern District of Texas sentenced Kemmie Houston to 63 months in prison and Sharon Beal to 51 months in prison. In addition to their prison terms, Houston and Beal were sentenced to two years of supervised release and were ordered to pay $403,704 in restitution, jointly and severally.

Beal, 48, and Houston, 43, pleaded guilty in June 2011 to one count of conspiracy to commit health care fraud.

According to court documents, Beal and Houston owned and operated STK Consultants. STK maintained a Medicare provider number to submit Medicare claims for the costs of DME and purported to provide orthotics, power wheelchairs, power wheelchair accessories and other DME to Medicare beneficiaries. According to court documents, Beal and Houston caused STK to submit claims to Medicare for DME that was medically unnecessary and/or not provided, including orthotic devices that were components of “arthritis kits.” The arthritis kit generally contained a number of devices including braces for both sides of the body and related accessories such as heat pads. In total, from August 2005 through August 2010, STK submitted approximately $851,212 in fraudulent claims to Medicare.

The sentences were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; Special Agent in Charge Stephen L. Morris of the FBI’s Houston Field Office; Special Agent in Charge Mike Fields of the Dallas Regional Office of HHS’s Office of the Inspector General (HHS-OIG) and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU).

The case was prosecuted by Trial Attorney Laura M.K. Cordova and Assistant Chief Sam S. Sheldon of the Criminal Division’s Fraud Section. The case was brought as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Southern District of Texas and the Criminal Division’s Fraud Section.

Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,140 defendants who collectively have falsely billed the Medicare program for more than $2.9 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.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to Stopmedicarefraud.gov.