Judge Fines Chiropractor $125,000 for Falsifying Records
|U.S. Attorney’s Office December 03, 2009|
GRAND RAPIDS, MI––Danny N. Schultz, age 44, of Gasquet, California, was sentenced to three years of probation, $62,401.22 restitution, and $125,000 as a criminal fine for submitting false documents to a health care benefit program, U.S. Attorney Donald A. Davis announced today. U.S. District Judge Robert J. Jonker imposed the sentence. Schultz, a chiropractor, admitted to directing his staff to prepare false documents to submit to Blue Cross Blue Shield of Michigan (“BCBSM”) as part of an audit of his billing practices.
The investigation of Schultz, who previously owned several chiropractic offices in the Lansing area, commenced when former patients made complaints to BCBSM. In reviewing these complaints, BCBSM investigators discovered evidence of falsified records and referred their findings to the Federal Bureau of Investigation (FBI). At his plea hearing, Schultz admitted that instead of billing BCBSM for the services actually provided to patients, Schultz directed employees to randomly bill BCBSM for specific chiropractic services. Schultz admitted that this random billing resulted in the payment for chiropractic services that were never provided.
Schultz further admitted that in response to a BCBSM audit in 2006, he directed employees to alter treatment records in an attempt to conceal the practice of randomly billing chiropractic services. At the sentencing, Judge Jonker imposed both restitution for services not provided and a fine that was four times higher than recommended by the Federal Sentencing Guidelines. Judge Jonker emphasized that the large fine, which would accrue interest until paid, should deter other health care professionals who would consider defrauding private or public health care plans or attempting to obstruct audits.
U.S. Attorney Davis stated that, “Protecting the integrity of our private health care insurance system is of paramount importance to the United States Attorney’s Office. This sentence is another warning to health care professionals who abuse the trust that our health care system places on their professional conduct. Federal agencies will continue to pursue professionals who submit false claims and who obstruct either private or public audits of their conduct. Medical professionals who abuse this trust or obstruct investigations will face consequences that include incarceration, significant fines, and loss of the ability to participate with insurance providers in the future.”
Gregory W. Anderson, Vice President of the Corporate and Financial Investigations Department of Blue Cross and Blue Shield of Michigan, echoed the comments of U.S. Attorney Davis and urged anyone with a concern about health care claims or health care providers to contact the BCBSM toll free anti-fraud hotline at 1-800-482-3787.
The investigation team was led by FBI Special Agent Terrence Fox, and the case was
prosecuted by Assistant U.S. Attorney Ray Beckering.