Mealey's Insurance Fraud

  • March 15, 2018

    Judge Finds Superseding Indictment Sufficiently Alleges Fraudulent Scheme

    MINNEAPOLIS — A federal judge in Minnesota on March 12 denied a man’s motion to dismiss a superseding indictment charging him with conspiracy to commit health care fraud, finding that the allegations in the indictment adequately alleged that he was a runner who recruited patients to go to a chiropractic clinic that submitted fraudulent claims to insurance companies (United States v. Angela April Schulz, et al., No. 16-341, D. Minn., 2018 U.S. Dist. LEXIS 41145).

  • March 12, 2018

    Judge Enters Default Judgment Against Clinic Owners, Orders Them To Pay $2.3M

    TRENTON, N.J. — A federal judge in New Jersey on March 9 entered default judgment against a radiology clinic and four of its owners who are accused of submitting fraudulent bills to the Government Employees Insurance Co. (GEICO) for reimbursement under patients’ no-fault personal injury protection (PIP) and ordered them to pay $2.3 million, finding that the defendants failed to raise at litigable defense (Government Employees Insurance Co., et al. v. Hamilton Health Care Center PC., et al., No. 17-0674, D. N.J., 2018 U.S. Dist. LEXIS 38902).

  • March 12, 2018

    Dermatologist Agrees To Pay $2.5M To Resolve False Claims Act Allegations

    FORT PIERCE, Fla.— A federal judge in Florida on March 7 dismissed a lawsuit accusing a dermatologist of violating the False Claims Act when billing Medicare and TRICARE, which provides health benefits for U.S. Armed Forces personnel, for muscle flap procedures that were not performed after the doctor agreed to pay $2.5 million to resolve the allegations (United States, ex rel. Patricia Cleary v. Tim Ioannides, M.D., et al., No. 15-14306, S.D. Fla.).

  • March 8, 2018

    Woman Lacks Standing To Attempt To Vacate Insurance Fraud Sentence, Judge Finds

    NEW YORK— A federal judge in New York on March 6 denied a woman’s motion to vacate her sentence for conspiracy to commit insurance fraud, finding that she lacked standing because she was not “in custody” at the time she filed her motion (Seritta Klass v. United States of America, No. 11 cr 893, S.D. N.Y., 2018 U.S. Dist. LEXIS 36511).

  • March 7, 2018

    Judge Finds Fraudulent Billing Scheme Resulted In $73.4M Of Intended Losses

    WEST PALM BEACH, Fla. — A federal judge in Florida on Feb. 21 found that a doctor’s fraudulent billing scheme resulted in Medicare losing more than $73.4 million, warranting an enhancement of his sentence (United States of America v. Salomon E. Melgen, No. 15-80049-CR-MARRA, S.D. Fla., 2018 U.S. Dist. LEXIS 31012).

  • March 7, 2018

    Judge: Man Must Pay Restitution To Insurer As Part Of Plea

    GEORGETOWN, Del. — A man who pleaded guilty to submitting a fraudulent insurance claim must pay $225,639.70 in restitution to the insurance company, a Delaware judge ruled Feb. 21, finding that a payment plan can be implemented to accommodate his alleged inability to pay (Delaware v. Robert S. Bangs, No. 1702000830, Del. Super., Sussex Co., 2018 Del. 88).

  • March 6, 2018

    6th Circuit Orders Trial On Nursing Director’s Claim That Fraud Forced Her To Quit

    CINCINNATI — A home health care provider’s former director of nursing may proceed with her claims that she was forced to resign due to her employer’s decision to seek and receive fraudulent reimbursements from the federal government as a jury may determine that the employer’s alleged fraud “plus the employee’s moral conscience and reasonable fear of being accused of participating in the employer’s fraud is enough to justify quitting,” a Sixth Circuit U.S. Court of Appeals panel ruled March 2 (Sue Smith v. LHC Group, Inc., et al., No. 17-5850, 6th Cir., 2018 U.S. App. LEXIS 5345).

  • March 6, 2018

    Appeals Court Upholds Man’s Conviction For Arson, Insurance Fraud

    PHILADELPHIA — A Pennsylvania appeals court on Feb. 27 affirmed a man’s conviction for arson and insurance fraud, finding that the trial court judge did not err in admitting evidence from two fires that occurred in March 2011, as well as testimony from the fire chief in which he concluded that the cause of the fire was an incendiary device (Pennsylvania v. John Edward Chairmonte, No. 2815 EDA 2015, Pa. Super., 2018 Pa. Super. Unpub. LEXIS 590).

  • March 6, 2018

    Magistrate Judge Orders Medical Providers To Turn Over Documents From Database

    LOS ANGELES — Medical service providers accused by UnitedHealth Group Inc. of submitting fraudulent bills were ordered by a federal magistrate judge in California on March 2 to provide responsive documents that are contained in a database, finding that the company that has the software license for the database is an alter ego of the providers (Almont Ambulatory Surgery Center LLC, et al. v. UnitedHealth Group Inc., et al., No. CV 14-03053-MWF, C.D. Calif., 2018 U.S. Dist. LEXIS 35616).

  • March 2, 2018

    Insurer Provided Sufficient Evidence Of Chiropractor’s Billing Scheme, Judge Says

    SEATTLE — State Farm Mutual Automobile Insurance Co. and State Farm Fire and Casualty Co. presented sufficient evidence showing that a chiropractor routinely submitted bills for reimbursement under patients’ personal injury protection (PIP) for treatment that was not medically necessary, a federal judge in Washington ruled Feb. 27 in denying the chiropractor’s motion for summary judgment (State Farm Mutual Automobile Insurance Co., et al. v. Peter J. Hanson, et al., No. C16-1085RSL, W.D. Wash., 2018 U.S. Dist. LEXIS 31799).

  • March 2, 2018

    Judge: Claims Question Appropriateness Of Chiropractor’s Professional Services

    SEATTLE — A Washington federal judge on Feb. 27 denied a professional liability insurer’s motion for summary judgment in its lawsuit disputing coverage for underlying claims that a chiropractor insured submitted misleading, false and/or fraudulent bills to obtain personal injury protection (PIP) payments from his patients’ auto insurer (PACO Assurance Company, Inc. v. Peter J. Hanson, No. 17-0649, W.D. Wash., 2018 U.S. Dist. LEXIS 31832).

  • March 2, 2018

    6th Circuit Panel Denies Health Care Defendants’ Motion For Release Pending Appeal

    CINCINNATI — A Sixth Circuit U.S. Court of Appeals panel on Feb. 28 denied motions filed by five defendants seeking to be released on bail pending the appeals of their convictions for health care fraud, holding that they did not satisfy their burden of showing that their appeals raise a substantial question of law or fact as to warrant relief under the Bail Reform Act (United States of America v. Robert L. Bertram Jr., et al., Nos. 17-6527, 17-6528, 18-5001, 18-5002, 6th Cir., 2018 U.S. App. LEXIS 5104).

  • February 28, 2018

    State Farm Can Amend Suit Over Fraud Scheme, Judge Rules

    MIAMI — State Farm Mutual Automobile Insurance Co. can amend a second amended complaint to remedy deficiencies in allegations that a clinic is subject to the requirements of the Health Care Clinic Act (HCCA) for allegedly receiving payments from third parties for inflated bills it prepared for patients involved in motor vehicle accidents, a federal judge in Florida ruled Feb. 16, finding that an amendment would not be futile (State Farm Mutual Automobile Insurance Company v. Performance Orthopaedics & Neurosurgery LLC, et al., No. 17-CV-20028-KMM, S.D. Fla., 2018 U.S. Dist. LEXIS 26841).

  • February 27, 2018

    Magistrate Judge Recommends Awarding Treble Damages To Insurers For RICO Claims

    NEW YORK — A federal magistrate judge in New York recommended granting a motion for default judgment filed by three insurers accusing a doctor and two clinics of submitting fraudulent bills for personal injury protection (PIP) insurance coverage that would require the defendants to pay treble damages for violating the Racketeer Influenced and Corrupt Organizations Act (Allstate Insurance Company, et al. v. Irage Yehudian M.D., et al., No. CV 14-4826, E.D. N.Y., 2018 U.S. Dist. LEXIS 27129).

  • February 20, 2018

    Evidence About Patient Recruiting, Vehicle Purchases Is Relevant, Judge Says

    LOUISVILLE, Ky. — Evidence concerning the recruitment of patients to a chiropractic clinic that allegedly fraudulently billed Medicare, as well as information showing that participants in the scheme put down large cash payments for expensive automobiles, is relevant, a federal judge in Kentucky ruled Feb. 16 in denying in part a defendant’s motion in limine (United States of America v. Claudia Lopez, et al., No. 15-CR-00054-JHM, W.D. Ky., 2018 U.S. Dist. LEXIS 25818).

  • February 21, 2018

    6th Circuit: Pharmacist Used Others’ Identifications To Further Fraud Scheme

    CINCINNATI — A federal judge in Kentucky erred when dismissing a count from an indictment charging a pharmacist with aggravated identity theft, a Sixth Circuit U.S. Court of Appeals panel ruled Feb. 20, finding that the defendant used the identities of a doctor and patient for the purpose of submitting a fraudulent claim to an insurance company (United States of America v. Philip E. Michael II, No. 17-5626, 6th Cir., 2018 U.S. App. LEXIS 3918).

  • February 15, 2018

    New York Appeals Court Affirms Evidentiary Rulings Entered During Arson Trial

    ROCHESTER, N.Y.  — A New York appeals court panel on Feb. 9 affirmed rulings by a trial court judge that denied a defendant’s motion to suppress statements he made to police after a fire destroyed a rental property he owned, as well as evidence on his parole status, finding that exclusion of the evidence would not have resulted in an acquittal (People v. Samuel F. Crawford, No. 1482 KA 14-01983, N.Y. Sup., App. Div., 4th Dept., 2018 N.Y. App. Div. LEXIS 953).

  • February 15, 2018

    Magistrate Judge: Insurer’s Amended Complaint Adequately States RICO Claim

    DENVER — A federal magistrate judge in Colorado on Feb. 12 recommended granting an insurance company’s motion to file a second amended complaint, finding that it sufficiently alleged that an enterprise exists under the Racketeer Influenced and Corrupt Organizations Act against an insurance adjuster accused of inflating a policyholder’s appraisal for roof damage following a hailstorm (Church Mutual Insurance Company v. Phillip Marshall Coutu, et al., No. 17-cv-00209-RM-NYW, D. Colo., 2018 U.S. Dist. LEXIS 22569).

  • February 14, 2018

    Judge Allows Insurer To Amend Complaint To Provide Details Of Fraud Scheme

    FLINT, Mich. — A statutorily created insurance program that provides insurance coverage for pedestrians struck by vehicles and passengers in automobile accidents can file a second amended complaint that provides additional details of a fraudulent scheme that submitted bills to insurance companies, a federal judge in Michigan ruled Feb. 13 (Michigan Automobile Insurance Placement Facility v. New Grace Rehabilitation Center PLLC, et al., No. 17-11007, E.D. Mich., 2018 U.S. Dist. LEXIS 22953).

  • February 12, 2018

    2nd Circuit Finds Investors To STOLI Policies Were Victims, Affirms Restitution

    NEW YORK — A federal judge in Connecticut did not err when finding that investors in three stranger obtained life insurance (STOLI) policies were victims under the Mandatory Victim Restitution Act (MVRA) and ordering a man who pleaded guilty to insurance fraud to pay $1.9 million in restitution, a Second Circuit U.S. Court of Appeals panel held Feb. 9, explaining that investors would not have given the defendant their money if they were aware of the scheme (United States of America v. David Quatrella, No. 17-1786-cr, 2nd Cir., 2018 U.S. App. LEXIS 3189).