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$200 Million Healthcare Fraud Scheme Results in Guilty Plea by South Florida Man

According to the Department of Justice (DOJ) press release, Miami-area resident Frank Criado has pleaded guilty for his part in a Medicare fraud scheme in which over $200 million in false claims were made to Medicare. Criado pleaded guilty to one count of conspiracy to defraud the United States by paying and receiving illegal health care kickbacks, as well as one count of conspiracy to commit healthcare fraud. When sentenced, Criado faces a possible prison term of up to 15 years and a maximum fine of $250,000.

In his plea, Criado acknowledged participating in the Medicare fraud masterminded by the owners and operators of American Therapeutic Corporation (ATC), which allegedly operated partial hospitalization programs (PHPs) for treatment of serious mental illness. The fraud also included ATC’s management company, Medlink Professional Management Group Inc. and the American Sleep Institute (ASI), which allegedly provided diagnostic sleep disorder testing.

ATC’s owners and operators allegedly paid kickbacks to the owners and operators of certain halfway houses and assisted living facilities to refer patients to ATC and ASI who were ineligible for their services so that ATC and ASI could submit false claims to Medicare for medically unnecessary services. Some patients also received a portion of the kickbacks. In all, millions in kickbacks were paid for the knowing referral of ineligible Medicare beneficiaries to ATC and ASI. Maintaining the fraud alleged required the co-conspirators to launder millions of dollars received from Medicare.

Criado pleaded guilty to acting as a patient broker for ATC and ASI, to whom he provided Medicare beneficiaries in exchange for kickbacks based on the amount of time each referred patient spent at ATC. Criado admitted that his participation in the scheme allowed the co-conspirators to file false claims totaling $7.3 million to the Medicare program. ATC, Medlink, and eleven individual co-conspirators have already pleaded guilty or been convicted at trial. Additional defendants charged in connection with the alleged fraud face trial next month.

Waters & Kraus is a national firm with highly skilled lawyers practicing qui tam and FCPA litigation in four offices, including Dallas, Los Angeles, San Francisco, and Baltimore. Our attorneys have decades of experience successfully representing whistleblowers in a variety of fraud cases. Contact us or call our attorneys at 800.226.9880 to learn more about our practice and how we can assist.

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