Controlling the Purse Strings

65037362 - healthcare cost concept with calculator and medical bill

The person who controls the purse strings within a business decides how the money is spent. It is a position of power and one that caused a home healthcare owner from Guysville, Ohio to commit Medicaid fraud and tax fraud. She let greed drive her fraudulent business practices, which involved billing for home care services she never provided. And, let’s not forget to mention that she also neglected to pay federal employment taxes over several years. (That can really add up.)

The woman from Southeast Ohio operated a home care business, but she didn’t provide the home health nursing services that she claimed. (That didn’t stop her from brazenly billing the Ohio Medicaid Program.) She used her billing software to record incorrect hours for nursing services, inflating the number of visits per week from one to between three and five. (With just a couple of clicks, she submitted fraudulent claims worth about $2.2 million.)

Over six years, the healthcare agency owner maintained her company’s books and records regarding payroll. (It would be accurate to say that she effectively “cooked her books.”) She not only submitted claims for Medicaid patients who were ineligible for services because they were either living in nursing homes or they were dead, but she also neglected to hand over employment taxes. This caused a loss of $366,825 to the Internal Revenue Service (IRS).

The 50-year-old deceptive healthcare agency owner from Guysville, Ohio pleaded guilty to Medicaid fraud and tax fraud charges. She received a sentence of three years and is required to pay the Ohio Medicaid Program more than $2.2 million in restitution. The fraudster also agreed to pay the IRS back taxes of nearly $367,000.

This woman’s selfish acts not only stole money from honest taxpayers who paid into the government healthcare benefits system to help vulnerable citizens, she also impacted her employees. By not paying withholding taxes to the IRS, she also impacted the Medicare and Social Security benefits for her workers, not to mention the IRS. The IRS and the Medicaid program had the last laugh as they ended her career as the owner and operator of a healthcare services company. (She no longer has control of anything and her purse has been emptied.)

Today’s “Fraud of the Day” is based on a Department of Justice press release entitled, Athens County Home Health Care Agency Owner Sentenced for Committing $2M Fraud,” released on April 26, 2018.

COLUMBUS, Ohio – Cheryl McGrath, 50, of Guysville, Ohio, was sentenced today in U.S. District Court to 36 months in prison for committing health care fraud and willful failure to pay over tax.

Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Ryan L. Korner, Special Agent in Charge, Internal Revenue Service (IRS) Criminal Investigation, Lamont Pugh III, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Office and Ohio Attorney General Mike DeWine announced the sentence handed down by Chief U.S. District Judge Edmund A. Sargus, Jr.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.