General Manager of Houston Medical Supply Company Pleads Guilty to Conspiracy to Commit Health Care Fraud

WASHINGTON—Manual Deluna has pleaded guilty to one count of conspiracy to commit health care fraud, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Tim Johnson of the Southern District of Texas; and Special Agent-in-Charge Mike Fields of the Dallas Regional Office of the U.S. Department of Health and Human Services, Office of the Inspector General (HHS-OIG).

Deluna, 48, pleaded guilty on Jan. 14, 2010, before U.S. District Court Judge Ewing Werlein Jr., in connection with Deluna’s role in Memorial Medical Supply, a Houston durable medical equipment company. Deluna was the general manager of Memorial Medical Supply, and began his association with the company in approximately October 2007. Deluna, along with co-defendants Sunny Robinson, Lisa Jones and Shirley A. Chavis, was originally indicted on July 22, 2009.

In connection with his plea, Deluna admitted that he and others illegally obtained protected Medicare beneficiary health information including names, dates of birth, medical histories, and Medicare and Social Security numbers from individuals and home health agencies. Deluna admitted that this health information was used to submit false and fraudulent claims to Medicare for reimbursement for equipment such as “Arthritis Kits,” power wheelchairs, and diabetic and incontinence supplies. Deluna admitted that the Medicare beneficiaries in many instances did not order or even need the medical equipment, nor did a physician actually prescribe these items. Deluna admitted that in several instances, Memorial Medical Supply also submitted false claims to Medicare in the names of Medicare beneficiaries who were deceased. Deluna admitted that from May 2006 through January 2009, Memorial Medical Supply submitted claims to Medicare in excess of $4.3 million.

Deluna remains on bond pending sentence, which is currently scheduled for April 9, 2010. Robinson, Jones and Chavis remain on bond pending trial.

This case is being prosecuted by Special Assistant U.S. Attorney Justin Blan, and was investigated by agents of the HHS-OIG, the Office of Personnel Management, the FBI and the Texas Attorney General’s Office - Medicaid Fraud Control Unit. This prosecution is the latest in the Medicare Fraud Strike Force’s efforts in the Houston area. The Strike Force is supervised by the U.S. Attorney’s Office for the Southern District of Texas and the Criminal Division’s Fraud Section.

Since the inception of Strike Force operations in March 2007—Miami (Phase One), Los Angeles (Phase Two), Detroit (Phase Three), Houston (Phase Four), Brooklyn (Phase Five), Tampa (Phase Six), and Baton Rouge (Phase Seven)—the Strike Force has obtained indictments of more than 475 individuals and organizations that collectively have billed the Medicare program for more than $1 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT) go to: www.stopmedicarefraud.gov