LOS ANGELES—A physician assistant who worked at fraudulent medical clinics where he used the stolen identities of doctors to write prescriptions for medically unnecessary durable medical equipment (DME) and diagnostic tests has been convicted of conspiracy, health care fraud, and aggravated identity theft charges in connection with a $18.9 million Medicare fraud scheme.
After a two-week trial in federal court in Los Angeles, a jury on Friday afternoon found David James Garrison, 50, of Leimert Park, guilty of one count of conspiracy to commit health care fraud, six counts of health care fraud, and one count of aggravated identity theft.
The evidence at trial showed that Garrison worked at fraudulent medical clinics that operated as prescriptions mills and trafficked in fraudulent prescriptions and orders for medically unnecessary DME, such as power wheelchairs, and diagnostic tests. The fraudulent prescriptions and orders were used by fraudulent DME supply companies and medical testing facilities to defraud Medicare. Garrison wrote the prescriptions and ordered the tests on behalf of some doctors he never met and who did not authorize him to write prescriptions and order tests on their behalf.
The trial evidence showed that between March 2007 and September 2008, Garrison’s co-conspirator, Edward Aslanyan, and others owned and operated several Los Angeles medical clinics established for the sole purpose of defrauding Medicare. Aslanyan and others hired street-level recruiters to find Medicare beneficiaries willing to provide the recruiters with their Medicare billing information in exchange for high-end power wheelchairs and other DME, which the patient recruiters told the beneficiaries they would receive for free. Often, the Medicare beneficiaries did not have a legitimate medical need for the power wheelchairs and equipment. The patient recruiters provided the beneficiaries’ Medicare billing information to Aslanyan and others, or they brought the beneficiaries to the fraudulent medical clinics. In exchange for recruiting the Medicare beneficiaries, Aslanyan and others paid the recruiters cash kickbacks.
Many of the beneficiaries whose Medicare billing information was used at the medical clinics lived hundreds of miles from the clinics, including some beneficiaries who lived more than 300 miles from the clinics. One witness testified that the clinics used beneficiaries who lived such long distances from the clinics because the billing numbers of Medicare beneficiaries who lived in and around Los Angeles had been used in other Medicare fraud schemes and, therefore, could no longer be used to bill Medicare.
The evidence presented at trial showed that Garrison wrote prescriptions for power wheelchairs that the beneficiaries did not need and did not use. In some cases, Garrison wrote power wheelchair prescriptions for beneficiaries he never examined and who never visited the clinics. In one instance, according to the evidence presented at trial, Garrison prescribed a power wheelchair to a beneficiary who did not have the mental capacity to operate the wheelchair.
Once Garrison wrote the power wheelchair prescriptions, Aslanyan and others sold the prescriptions for as much as $1,500 to the owners and operators of approximately 50 fraudulent DME supply companies. The fraudulent prescriptions were used to submit fraudulent power wheelchair claims to Medicare. The DME supply companies purchased the power wheelchairs wholesale for approximately $900 per wheelchair but submitted bills to Medicare at a rate of approximately $5,000 per wheelchair.
The trial evidence also showed that Garrison ordered medically unnecessary diagnostic tests for many Medicare beneficiaries, including tests for sleep studies, ultrasounds, and nerve conduction. These tests were then billed to Medicare by fraudulent diagnostic testing companies that paid Aslanyan kickbacks to operate from the medical clinics.
Throughout the trial, evidence was introduced that showed that Garrison had admitted to writing prescriptions for power wheelchairs and ordered diagnostic tests on behalf of approximately six different doctors and that he did not have a Delegation of Services Agreement with at least two of these doctors, as required by law.
As a result of this fraud scheme, Garrison, Aslanyan, and their co-conspirators submitted and caused the submission of more than $18 million in false and fraudulent claims to Medicare, which paid approximately $10.7 million on those claims.
Garrison is scheduled to be sentenced by United States District Judge Consuelo B. Marshall on September 17. At that time, Garrison faces a maximum statutory penalty of 72 years in federal prison and a $2 million fine. The aggravated identity theft conviction carries a mandatory two year prison sentence.
Currently, Garrison is facing federal drug charges as a result of his alleged involvement with another medical clinic where medically unnecessary prescriptions for Oxycontin were distributed (see: http://www.justice.gov/usao/cac/Pressroom/2011/147.html). Garrison is scheduled to go on trial in the drug case on November 6. He is presumed innocent of the charges against him in this case.
The conviction of Garrison was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; United States Attorney André Birotte, Jr.; Tony Sidley, Assistant Chief of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; Glenn R. Ferry, Special Agent in Charge for the Los Angeles Region of the HHS Office of Inspector General (HHS-OIG); and Steven Martinez, Assistant Director in Charge of the FBI’s Los Angeles Field Office.
The case is being prosecuted by Assistant United States Attorney David Kirman and DOJ Trial Attorney Jonathan T. Baum.
The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the United States Attorney’s Office for the Central District of California. The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.
Since their inception in March 2007, strike force operations in nine districts have charged 1,330 defendants who collectively have falsely billed the Medicare program for more than $4 billion. In addition, the HHS 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 HEAT, go to www.stopmedicarefraud.gov.