Occupational Therapist, Patient Recruiter Plead Guilty to Medicare Fraud

Detroit resident Jaquita Lovelace and Miami resident Timothy Pierce have pleaded guilty in U.S. District Court in Detroit to participating in conspiracies to defraud the Medicare program.

Pierce, 42, pleaded guilty to conspiracy to commit health care fraud Nov. 18 before U.S. District Judge Denise Page Hood, and Lovelace, 30, pleaded guilty to conspiracy to commit health care fraud on Nov. 17, before U.S. District Judge Sean F. Cox.

In her plea, Lovelace, a licensed occupational therapist, admitted that she began working in approximately September 2005 as a contract therapist for co-conspirator Suresh Chand, who entered a guilty plea in the same case in September. Chand owned and controlled several companies operating in the Detroit area that purported to provide physical and occupational therapy services to Medicare beneficiaries. Lovelace admitted that she, Chand, and others created fictitious therapy files appearing to document occupational therapy services provided to Medicare beneficiaries, when in fact no such services had been provided. According to court documents, the fictitious services reflected in the files were billed to Medicare through sham Medicare providers controlled by Chand and other co-conspirators.

Lovelace admitted that her role in creating the fictitious therapy files was to sign documents and progress notes indicating she had provided occupational therapy services to particular Medicare beneficiaries, when in fact she had not. Lovelace was paid between $90 and $110 by Chand per file that she falsified in this manner. Lovelace also admitted that in the course of the scheme charged in the indictment, she signed approximately 544 fictitious occupational therapy files, falsely indicating she had provided occupational therapy services to Medicare beneficiaries. Lovelace admitted she knew that the files she helped falsify were used to justify fraudulent billings to Medicare.

In addition, Lovelace admitted that between approximately September 2005 and October 2006, Chand and his co-conspirators submitted claims to the Medicare program totaling approximately $2,176,000 for files that were falsified by Lovelace. Medicare actually paid approximately $1,088,000 on those claims. Lovelace admitted that throughout the conspiracy, she was fully aware that Medicare was being billed for occupational therapy services she had falsely indicated she had performed.

In his plea, Pierce admitted that he was hired in March 2006 to recruit, drive, and pay kickbacks to Medicare beneficiaries to induce them to go to Dearborn Medical Rehabilitation Center (DMRC), a Dearborn, Mich., infusion clinic. The beneficiaries Pierce admitted to recruiting were paid to sign paperwork indicating that they had received infusions and injections of specialty medications that they did not in fact receive.

Pierce admitted that DMRC routinely billed the Medicare program for services that were medically unnecessary or were never provided. The primary owners and operators of DMRC, co-conspirators of Pierce, purchased only a small fraction of the medications that the clinic billed the Medicare program for providing. According to the Department of Justice, patients were prescribed medications at the clinic based not on medical need, but instead based on which medications were likely to generate Medicare reimbursements.

The cases are being prosecuted by Senior Trial Attorney John K. Neal of the Criminal Division's Fraud Section and by Special Assistant U.S. Attorney Thomas W. Beimers of the Eastern District of Michigan. The FBI and the HHS Office of Inspector General (HHS-OIG) conducted the investigation. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division's Fraud Section, and the U.S. Attorney's Office for the Eastern District of Michigan.

Since the inception of Strike Force operations in March 2007 -- Miami (Phase One), Los Angeles (Phase Two), Detroit (Phase Three), and Houston (Phase Four) -- the Strike Force has obtained indictments of more than 331 individuals and organizations that collectively have billed the Medicare program for more than $720 million. In addition, HHS's Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers, DOJ said.

Each of the Strike Force teams across the separate phases are led by a federal prosecutor from the Criminal Division's Fraud Section or the U.S. Attorney's Office. Each team has an agent from the FBI and HHS-OIG. For more about the Health Care Fraud Prevention and Enforcement Action Team, go to www.stopmedicarefraud.gov.

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