A federal appeals court in Virginia recently upheld the Medicaid fraud conviction against the married operators of an in-home medical care company. According to prosecutors, Wayne Perry, Jr.’s Community Personal Care billed Medicaid for health care services that were never provided to low income individuals. Virginia’s Medicaid program authorizes private companies to provide in-home healthcare services to low income individuals. These healthcare companies are paid for their services with taxpayer-funded funds.
To implement the in-home services, a registered nurse creates an approved plan for the person receiving Medicaid services. These care plans cap the number of hours that providers may bill for services. Even though there is a cap on hours, invoices for services must be based on the actual number of hours provided. According to prosecutors, Community Personal Care had great difficulty complying with this last requirement. Its employees continually invoiced Virginia Medicaid for the maximum number of service hours authorized under patient care plans, rather than actual hours that were provided. This fraudulent scheme is known as “billing by the plan of care.” Employees doctored records, forged signatures, added hours to timesheets, and otherwise engaged in fraud to perpetuate the fraud. On weekends, Community Personal Care directed its employees to spend the weekend doctoring records in order to prepare for an upcoming audit. According to court records, Angela Perry (Wayne Perry’s wife and executive assistant) directed one employee to spend her time forging signatures because she was the “artistic one.”
In February 2014, a grand jury indicted the Perrys on 18 charges of healthcare fraud, conspiracy to commit healthcare fraud, making false statements relating to health care, alteration of records, and aggravated identity theft. Allison Hunter-Evans, a former Virginia Department of Medical Assistance Services employee hired by the Perrys as a consultant, was also charged with alteration of records. Ms. Hunter-Evans testified against the Perrys at trial and was sentenced to four years probation.
At trial, more than a dozen witnesses testified that Community Personal Care submitted fraudulent Medicaid claims from 2009 to 2012, collecting more than $1.4 million for work that was never actually provided to low income individuals. The jury convicted the Perrys on all counts and they appealed, challenging the sufficiency of evidence presented against them.
The Perrys did not dispute that employees submitted fraudulent invoices, used patient identification numbers without permission, and altered timesheets and other records in an attempt to hide their fraud from Medicaid auditors. At trial, they claimed that employees concocted and implemented the scheme without their knowledge. On appeal, they claimed that the evidence presented against them was insufficient.
The 4th Circuit Court of Appeals opinion describes the evidence presented against the Perrys as “ample.” Examples include:
- Wayne Perry’s imposition of quotas for care hours,
- Threats to fire employees who did not meet quotas,
- Instructions to submit additional invoices in order to meet the maximum allowed care hours,
- Extensive evidence of multiple employees falsifying records for hours that were never worked,
- Mr. Perry’s performance demands made late in the billing cycle so that he knew or should have known there was no way employees could honestly meet their billing quotas,
- Evidence of financial incentives for the Medicaid fraud, and
- Separate payments made to employees for meeting quotas that required Mr. Perry’s approval.
The Appeals Court found this and other evidence undermined the Perrys’ contention that they were unaware of the fraud. Community Personal Care’s fraudulent scheme stole money that was intended for low income individuals. According to prosecutors, Community Personal Care submitted about 7,800 fraudulent claims to the Virginia Medicaid program, falsely representing that care services had been provided to 78 Medicaid recipients. Although this case was investigated by the FBI and the Virginia Virginia Attorney General’s Medicaid Fraud Control Unit, private citizens who have information about schemes similar to Community Personal Care may be financially rewarded for reporting fraud. The Virginia Fraud Against Taxpayers Act empowers whistleblowers to file “qui tam” lawsuits if they know of violations of health care law, including Medicaid and Medicare. The whistleblower’s award can range between 15 and 30 percent of an eventual recovery. At Chaikin, Sherman, Cammarata & Siegel, we represent whistleblowers who report Medicaid and Medicare fraud throughout Virginia, Maryland, and Washington, D.C. If you have credible information about a healthcare company submitting fraudulent claims to Medicaid or Medicare, please call us today for a free, prompt, and confidential consultation with an attorney.