Flying Under the Radar

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Criminals who commit fraud against the government hope to fly under the radar without being detected by vigilant civil servants.  An East Helena woman tried to hide her elaborate Medicaid fraud scheme, but Montana’s Surveillance and Utilization Review Section (SURS) observed many irregularities within a multitude of Medicaid claims that led them to conduct surveillance. A subsequent investigation uncovered her scam which involved the theft of more than $464,000 from two government agencies.

The woman at the center of today’s case worked at a Helena, Montana physical therapy office, where she was a medical biller. Over about four years, she submitted claims to Medicaid for hundreds of physical therapy treatments purportedly performed on her, her husband and their children. Over time, SURS detected irregularities in the Physical Therapist’s (PT) Medicaid billing practices. (Medicaid received claims for only five Medicaid beneficiaries from the PT’s practice. The claims covered nearly seven days a week and were for the medical biller’s family members. That’s a lot of PT.)

Additional research into this case shows that after SURS determined that something was awry, the organization requested documents from the PT practice to support the claims. When no response was received, a second request was made three months later. SURS then received the requested documents, but not all of the requested information was included. (The medical biller fabricated records for her family that contained duplicate wording, consistent misspellings and signatures from someone else other than the physical therapist. No written referrals for physical therapy were found.)

Surveillance was conducted on the physical therapy practice and the physical therapist’s residence for several days to determine whether any beneficiaries were visiting the office. (Medicaid later received claims for one of the medical biller’s children who was at work at the time of the treatment.)

During the execution of a search warrant, officers seized a computer showing that Medicaid patient files for the medical biller’s family were created after the SURS request. Bills were submitted for one of the children for 233 days of physical therapy, even though it was determined she had only had received treatment five days in her entire life. (Prior to the child’s interview with investigators, the mother tried to convince her child to lie and say that she received multiple physical therapy treatments at the practice because she had hurt her neck while falling off a riding lawn mower.)

The medical biller’s family was ineligible to receive Medicaid during the time the claims were submitted due to falsifications she made on her family’s eligibility paperwork. (She received $290,476 from Medicaid for her bogus claims.) Further research shows that the family also received treatment from 63 other medical providers that caused an additional loss of $25,664 to the government healthcare program. (And, I should also mention that the family received a multitude of medications that caused Medicaid to incur an additional loss of $18,343.)

Medicaid fraud was not this woman’s only deceptive game. She also filed several false tax returns during the healthcare fraud scheme. (She substantially underestimated her income, which caused a loss of $43,514 to the IRS.)

The 52-year-old Montana woman pleaded guilty to healthcare fraud and tax evasion. She was sentenced to five years in prison for defrauding Medicaid to be followed by three years of supervised release. (She also has two pretty big restitution checks to write to Medicaid and the IRS.)

This woman underestimated the government and its dedicated employees who noticed the irregularities in this woman’s fraudulent billing scheme. Congratulations to the investigators who detected this bogus blip on the radar screen and successfully grounded her scam.

Today’s “Fraud of the Day” is based on an article entitled, East Helena woman receives five years in prison for Medicaid fraud,” posted on on June 13, 2017.

(HELENA) An East Helena woman was sentenced Tuesday to five years in prison for defrauding Medicaid.

Elizabeth Jones Powell pleaded guilty in February to federal charges of health care fraud and tax evasion. After her prison term, she will be on supervised release for three years. She will also have to pay back more than $450,000 in fraudulent Medicaid claims and unpaid taxes.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.