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The owner of more than 30 Miami-area skilled nursing and assisted living facilities, a hospital administrator and a physician's assistant were charged with conspiracy, obstruction, money laundering and healthcare fraud in connection with a $1 billion scheme involving numerous Miami-based providers, the United States Department of Justice announced.
Assistant Attorney General Leslie Caldwell of the Justice Department's Criminal Division said in a statement that the charges represent the largest single criminal healthcare fraud case ever brought against individuals by the DOJ.
Philip Esformes, 47, Odette Barcha, 49, and Arnaldo Carmouze, 56, all of Miami-Dade County, Florida, were charged in an indictment claiming that Esformes operated a network of more than 30 skilled nursing homes and assisted living facilities known as The Esformes Network, which gave him access to thousands of Medicare and Medicaid beneficiaries.
Authorities said many of these beneficiaries did not qualify for skilled nursing home care or for placement in an assisted living facility, but Esformes and his co-conspirators nevertheless admitted them to Esformes Network facilities where the beneficiaries allegedly received medically unnecessary services that were billed to Medicare and Medicaid.
Citing court documents, the DOJ said Esformes and his co-conspirators are also alleged to have received kickbacks in order to steer these beneficiaries to other healthcare providers -- including community mental health centers and home healthcare providers -- who also performed medically unnecessary treatments that were billed to Medicare and Medicaid. In order to hide the kickbacks from law enforcement, they were often paid in cash, or were disguised as payments to charitable donations, payments for services and sham lease payments.
Esformes and Barcha were also charged with obstructing justice. According to the indictment, following the 2014 arrest of co-conspirators Guillermo and Gabriel Delgado, Esformes attempted to fund Guillermo Delgado's escape from the United States to avoid trial in Miami. The indictment further alleges that Barcha created sham medical director contracts following receipt of a grand jury subpoena on June 20 in order to conceal and disguise the payment of kickbacks she made in exchange for patient referrals for admission to Esformes Network facilities, as well as another Miami-area hospital, the DOJ said.
According to court documents, in 2006, Esformes paid $15.4 million to resolve civil federal healthcare fraud claims for essentially identical conduct: unnecessarily admitting patients from his assisted living facilities into a Miami-area hospital. But Esformes and his co-conspirators allegedly continued this criminal activity, adapting their scheme to prevent detection and continue their fraud after the civil settlement, the DOJ said.
The indictment alleges that the co-conspirators accomplished this by employing sophisticated money laundering techniques in order to hide the scheme, and Esformes' identify, from investigators.
The FBI and Health and Human Services' Office of the Attorney General ultimately employed advanced data analysis and forensic accounting techniques, and were able to identify the full scope of the fraud scheme, according to the DOJ.
The FBI and HHS-OIG investigated the case, which 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 Southern District of Florida.