A federal judge in Dallas on Wednesday ordered four healthcare professionals to pay the federal government $339.4 million in a qui tam action tied to one of the largest home healthcare fraud cases in U.S. history.
The order, entered by Chief U.S. District Judge Barbara Lynn of the Northern District of Texas, directed formerly licensed doctors Noble Ezukanma of Fort Worth and Ransome Etindi of Waxahachie — whose license was suspended by the Texas Medical Board in 2011 for allegedly having sex with a patient — to pay approximately $102 million and $55 million, respectively.
Judge Lynn also ordered Merna Parcon and Ben Gaines III, who owned and operated the web of healthcare agencies involved, to pay approximately $155 million and $28 million, respectively. Judge Lynn entered final judgment on the damages on the same day.
Dallas attorney Rusty Tucker, who represents the whistleblower in the case, said his client is expected to receive around $80 million of the judgment at minimum as part of the 25 to 30% cut qui tam whistleblowers receive for bringing an action on behalf of the government — if the government ever recovers the full amount awarded by Judge Lynn, that is.
Recovery efforts have been generally unsuccessful so far, Tucker said, although the government has seized a little over $1 million in assets from Ezukanma, including hundreds of thousands of dollars in cash the feds found in a safe when they raided his Fort Worth home, a 2006 Mercedes Benz, and assets tied to his 401(k) and other bank accounts.
Further developments in this area will be wait-and-see, Tucker said, since the government is still actively looking into asset recovery.
The whistleblower, Grant Bachman, was an employee of U.S. Physician Home Visits (USPHV), one of the healthcare agencies that the defendants mutually owned and operated to carry out the fraud. Tucker said Bachman’s essential role at the company was as an assistant for Parcon, the primary owner of USPHV. Part of his duties included accompanying the doctors to the home visits that determined whether patients qualified as “homebound” under Medicare’s standards.
Under the agency’s heightened standards, Tucker said, many of the patients were not even close to being eligible, as they were often out playing golf or at another doctor’s office when Bachman and the physicians would show up at their doors.
Bachman alleged that the doctors would still bill Medicare and Texas Medicaid for such patients they didn’t even see. When they did see a patient, they would often bill for 90 minutes even if they only saw the patient for 15 minutes so that the cost of the visit would bump up a level to a different billing code.
Bachman retained Tucker to file a sealed civil action in early 2013, which led to a grand jury indictment in June 2015. Bachman’s lawsuit was unsealed shortly thereafter.
Tucker said his client felt “almost physically ill” having to go to work and “watch what they (the physicians) were doing every day.”
“They would certify a patient as being homebound without ever even seeing the patient to make that determination,” Tucker said.
What’s more, according to court records, the group billed for more hours there were in a day 21 different times.
“This fraudulent scheme astoundingly resulted in Ezukanma or Etindi billing over 100 hours per day on several occasions to Medicare for physician home visits,” Tucker said. “On 12 different occasions, Ezukanma billed Medicare hours ranging from 102.7 hours per day to 205.9 hours per day.”
Lawyers who defended Ezukanma, Etindi, Parcon and Gaines did not immediately return messages left Thursday seeking comment on Judge Lynn’s ruling.
Prosecutors said the defendants carried out their fraud by operating under a trio of companies. While USPHV and the other two companies, A Good Homehealth and Essence Home Health, appeared to be set up as three separate entities, the companies worked as one. The same employees often worked for and were paid by all three companies.
The fraud unraveled after officials with the FBI, U.S. Attorney’s Office and other government agencies caught wind of Bachman’s complaint. Tucker said two weeks after Bachman met with investigators and drew diagrams on where various files were located, the FBI simultaneously raided the offices of USPHV and the other affiliated companies scattered around North Texas. Tucker said Bachman was at work the day the feds showed up.
Parcon, Gaines, Etindi and other defendants reached plea deals with the government, while Ezukanma stood trial in March 2017. A federal jury in U.S. District Judge Jane Boyle’s court found him guilty of one count of conspiracy to commit healthcare fraud and six counts of healthcare fraud. Judge Boyle sentenced him to 16 years in prison and ordered him to pay $34 million in restitution. Ezukanma appealed but the U.S. Court of Appeals for the Fifth Circuit affirmed his conviction.
Judge Boyle sentenced both Parcon and Etindi on Aug. 17, 2017. She sentenced Parcon to 10 years in prison and ordered her to pay $51.5 million in restitution. She sentenced Etindi to 30 months in prison and ordered him to pay $18 million in restitution. She later sentenced Gaines to five years in prison and ordered him to pay $9 million in restitution.
The indictments of the USPHV officials were part of a bundle of nationwide sweeps announced by the Department of Justice in what was at the time the largest crackdown on Medicare fraud in strike force history, both in terms of the number of defendants charged and the loss amount.
Prosecutors alleged the USPHV group cost Medicare nearly $60 million between Jan. 1, 2009 and June 9, 2013 alone. The nationwide sweep, spread across 17 districts, resulted in charges against 243 individuals for participating in Medicare and Medicaid fraud schemes involving $712 million in false billings.
The $339 million that Judge Lynn awarded on Wednesday included the treble damages that relators are entitled to under the False Claims Act.
Tucker said he hopes Judge Lynn’s order “sends a strong message” to those who commit or conspire to commit Medicare fraud.
“Companies and individuals who violate the federal False Claims Act will be held accountable,” he said. “Mr. Bachman, who came forward, should be recognized for helping expose this massive home healthcare fraud.”
The DOJ attorneys in charge of prosecuting the defendants were Assistant U.S. Attorneys Douglas Brasher and Katherine Pfeifle, one of the lead AUSAs who successfully prosecuted eight defendants in the Forest Park federal bribery and kickback trial this spring.