The Joyride is Over

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Luxury car commercials are famous for advertising vehicles with glossy wax jobs, sleek interiors and attractive drivers while speeding across beautiful terrain. (You can almost feel the wind in your hair followed by the shock of the sticker price.) According to an article in The Charlotte Observer, a woman bought into the luxury car dream and took quite a few joyrides in her 2010 Mercedes-Benz CLS550, compliments of the Medicaid program.

The article states that between 2010 and 2012, the enterprising fraudster and her co-conspirators filed $4.8 million in false mental and behavioral health services claims with Medicaid, resulting in payments of $2.5 million. The Charlotte woman, who operated after-school and summer childcare programs with her co-conspirators, was not a licensed mental or behavioral health provider, nor was she approved by Medicaid.

So how did the scheme work? She used Medicaid provider numbers that were assigned to other companies and therapists to commit the fraud. Then, she directed Medicaid payments to bank accounts she and her co-conspirators controlled instead of the Medicaid providers. (As you might have guessed, most claimed services were not provided.)

The fraudster’s joyride ended abruptly (Do you hear the sound of tires screeching to a halt?) as she pleaded guilty to stealing the identity of a therapist to commit the fraud, money laundering conspiracy and attempting to sell her Mercedes Benz to prevent law enforcement officials from seizing the car. One of the co-conspirators also pleaded guilty to carrying out a similar $8 million Medicaid fraud conspiracy in a nearby town. (They could have had a decent used car lot of luxury cars for that amount of money.) It turns out the two collaborated to obtain Medicaid beneficiary identification information.

The Charlotte fraudster is looking at two years in prison for identity theft. She could receive up to 10 years in prison for the health care fraud. The money laundering charge could also carry a maximum sentence of 10 years in prison. The co-conspirator has not yet been sentenced.

The biggest losers in this scam are the users of Medicaid services. The fraud is paid for by honest citizens who shell out more money for higher taxes and expensive health care premiums. As the Janis Joplin song ”Mercedes Benz” goes, this fraudster ”must make amends.’? She traded her luxury car in for a paddy wagon, which is in a totally different class of vehicles.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Charlotte Woman Pleads Guilty to $4.8 Million Medicaid Fraud,” published on April 3, 2013 by the The Charlotte Observer.

CHARLOTTE – A Charlotte woman pleaded guilty Tuesday for her involvement in a conspiracy to defraud Medicaid out of $4.8 million for sham mental and behavioral health services, federal prosecutors announced.

Rodnisha Sade Cannon, 26, also pleaded guilty to stealing a therapist’s identity to commit the fraud and money laundering conspiracy.

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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.