Woman Sentenced to 54 Months in Prison for Involvement in a $1.5 Million Medicaid Fraud Scheme

CHARLOTTE, NC—A Mt. Holly woman was sentenced to 54 months in prison and three years of supervised release for her role in a conspiracy to commit health care fraud and for money laundering charges, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. Chief U.S. District Judge Robert J. Conrad also ordered the defendant to pay restitution in the amount of $1,585,093 to the North Carolina Medical Assistance Program (Medicaid).

U.S. Attorney Tompkins is joined in making today’s announcement by Attorney General Roy Cooper, who oversees the North Carolina Medicaid Investigations Unit (MIU); Derrick Jackson, special agent in charge, Department of Health and Human Services, Office of the Inspector General (HHS-OIG), Office of Investigations, Atlanta Region; Russell F. Nelson, special agent in charge of the United States Secret Service (USSS); Jeannine A. Hammett, special agent in charge of the Internal Revenue Service-Criminal Investigation Division (IRS-CI); and Chris Briese, special agent in charge of the Federal Bureau of Investigation (FBI), Charlotte Division.

Erika Holland, 42, of Mt. Holly, pled guilty in September 2011 to one count of conspiracy to commit health care fraud and one count of money laundering. In April 2011, a federal grand jury in Charlotte indicted Holland on charges of defrauding Medicaid of over $1.5 million, and laundering the proceeds of her fraud by purchasing vehicles, a residence, and a timeshare. According to the indictment, plea documents, and court hearings:

From 2009 to September 2010, Holland, along with her co-conspirators Joanna Patronis, of Cramerton; and Giraud Hope, of Charlotte, filed false and fraudulent claims with Medicaid seeking reimbursement for mental and behavioral health services allegedly provided by Holland and/or her companies. The fraudulent claims were filed through either Hope’s company, Hope and Family Behavioral Resources (HFBR) or through Patronis’ company, A Time For Everything (ATE).

The false claims submitted to Medicaid misrepresented both the company and the therapist who provided the services and the types of services provided. Holland and her companies were not authorized by Medicaid to provide mental and behavioral health services and did not employ any therapists licensed to provide the claimed services. Yet Holland sought reimbursement for services allegedly rendered by her companies by fraudulently claiming that those services had been provided by HFBR and ATE. The co-conspirators falsely stated on these Medicaid claims that a licensed physician (identified as “Dr. L.D.”) had provided the services when, in fact, Dr. L.D. did not provide any of the services and had no professional association with Holland or her companies. Holland’s fraud scheme caused Medicaid to pay over $1.5 million in reimbursements for these fraudulent claims. Holland then spent the proceeds of this fraud on numerous vehicles, including a 2003 Hummer H2, a 2007 BMW 750LI, and a 2007 Infiniti QX56. Holland also purchased her residence in Mt. Holly and a timeshare in Kissimee, Florida with the proceeds of her fraud. During the course of the investigation of Holland, the United States Secret Service had seized the following property for forfeiture to the United States: $71,330 in funds, a 2003 H2 Hummer, a 2007 Infiniti QX56, a 2007 BMW 750LI, and a 2007 Mini Cooper.

In announcing the sentence, Chief Judge Conrad characterized the “theft of money from a fund for low-income recipients” as appalling and noted that the conduct was “egregious” and “deserving of just punishment.” In October 2011, Giraud Hope was sentenced to serve 15 months in prison for his involvement in the scheme. He will also serve three years under court supervision and was ordered to pay over $1.9 million in restitution to Medicaid.

Joanna Patronis, Holland’s other co-conspirator, pled guilty in April 2011 to one count of health care fraud conspiracy. Patronis has also admitted that her criminal conduct resulted in a loss of over $2,500,000 and has agreed to forfeit $2,700,000, including $46,857.57 in funds seized during the course of the investigation, a 2010 Toyota Rav-4, and her residence located in Cramerton. She faces a maximum statutory penalty of 10 years of imprisonment, a $250,000 fine, or both. A sentencing date for Patronis has not been set yet. “There are doctors, health care providers, and private companies who are honest and passionate about providing quality care to their patients. And then there are those who aren’t,” said U.S. Attorney Tompkins. “For those who belong in the second category, today’s sentencing should serve as a warning that together with our partners we will find them, prosecute them, and make sure they do not make another dime off of a government health program that is intended to assist low-income parents, children, seniors, and people with disabilities with their health care costs.” “Medicaid fraud diverts precious resources from those who need it most,” said HHS-OIG Special Agent in Charge Jackson. “Holland chose to live a lavish lifestyle on the expense of taxpayers, now she will serve prison time for her illegal scheme.” IRS-CI Special Agent Hammett stated, “Health care fraud is a serious offense. Those who believe they can defraud the government and get away with it will find that they will be caught. IRS-Criminal Investigation special agents will seek out those who commit fraud and make sure they do not profit from their misdeeds.”

Holland has been on bond since her arrest in April 2011. Upon designation of a federal facility Holland will surrender to the Federal Bureau of Prisons. Federal sentences are served without the possibility of parole. The investigation into Holland, Patronis, and Hope was led by the HHS-OIG, MIU, USSS, and IRS, with assistance from the FBI. The prosecution of the case was handled by Assistant U.S. Attorney Kelli Ferry of the U.S. Attorney’s Office, in Charlotte.

The investigation and charges are the work of the Western District’s joint Health Care Fraud Task Force. The task force is a multi-agency team of federal prosecutors and federal and state investigators who are dedicated to identifying and punishing those who defraud the health care system, and to reduce the potential for health care fraud in the future. If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447-8477 (1-800-HHS-TIPS) or by e-mail at HHSTips@oig.hhs.gov.