Medical Clinic Owner Pleads Guilty to Role in $5.3 Million Medicare Fraud Scheme

The owner and operator of two Miami medical clinics has pleaded guilty to defrauding the Medicare program in connection with a $5.3 million HIV infusion fraud scheme, Acting Assistant Attorney General Matthew Friedrich of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida announced today.

Orlando Pascual Jr., 43, pleaded guilty on Jan. 7, 2009, to conspiracy to commit healthcare fraud before U.S. District Judge Ursula Ungaro.  In his plea, Pascual admitted that he co-owned two Miami clinics named Medcore Group LLC (Medcore) and M&P Group of South Florida Inc. (M&P) that purported to specialize in the treatment of HIV-positive patients.  Pascual admitted that beginning in August 2004 and continuing through November 2006 he conspired with others to submit approximately $5.3 million in fraudulent claims to Medicare.  Pascual also pleaded guilty to two separate schemes to launder the proceeds of the health care fraud.

During the plea, Pascual admitted that Medcore and M&P were operated for the purpose of defrauding Medicare, that the treatments for infused or injected drugs were not medically necessary, and that he and others paid cash kickbacks to the patients for every visit to the clinic.  To obtain all the cash necessary to pay the patients, Pascual stated that he and others would write checks that appeared legitimate to people who would cash the checks and then return the cash to them for a fee.

Pascual acknowledged that most patients were HIV-positive or were given false diagnoses of cancer.  He stated during the plea that he and others used physicians, a physician’s assistant and phlebotomists to help facilitate the scheme.  In addition, Pascual acknowledged that clinic employees intentionally manipulated patients’ blood samples so that they would appear to need treatment, when in fact they did not.  Pascual stated that such tampering was done to make the medical files appear legitimate.

Pascual is currently incarcerated for Medicare fraud involving the operation of a durable medical equipment (DME) company in Miami from 2001 to 2003. Sentencing in this case is scheduled for April 3, 2009.

Seven co-defendants in the case are scheduled for trial beginning Feb. 9, 2009, in the Southern District of Florida.  An indictment is merely a charge, and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.

The case was prosecuted by Deputy Chief Kirk Ogrosky and Assistant Chief John S. “Jay” Darden of the Criminal Division’s Fraud Section and investigated by the Department of Health and Human Services, Office of the Inspector General and FBI.  The case was brought as part of the Medicare Fraud Strike Force (MFSF), supervised by the Criminal Division’s Fraud Section and U.S. Attorney Acosta of the Southern District of Florida.  Since the inception of MFSF operations, federal prosecutors have indicted 106 cases with 189 defendants in both Los Angeles and Miami.  Collectively, these defendants fraudulently billed the Medicare program for more than half a billion dollars.