Two Plead Guilty in Lucrative Kickback and Medicare Fraud Scheme
JACKSON, TN—A married couple has pled guilty to partaking in a scheme to defraud Medicare of more than $400,000 by making fraudulent medical equipment orders and paying illegal kickbacks. Four defendants were previously indicted in the scheme—three in February 2015 and one in October 2015. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced the guilty pleas today.
According to evidence presented in court, Dennis Sensing, 62, and Brenda Sensing, 45, both of New Albany, Mississippi partook in a lucrative health care and kickback fraud scheme between 2011 and 2013. The conspiracy also involved another married couple, Sandra and Calvin Bailey, as well as their son, Bryan Bailey, and accomplice, Cindy Mallard.
According to the charging documents, the Sensings operated the Adult and Children Medical Clinic in Guntown, Mississippi while also working as salespersons for Jaspan Medical Systems, a durable medical equipment company with an office in Jackson, Tennessee. Although Brenda Sensing was listed as a Jaspan employee paid via sales commissions, the commissions paid to her were actually for sales by Dennis Sensing. Pay was arranged to go to Brenda Sensing to avoid tax obligations incurred by her husband.
In their pleas, the Sensings admitted to paying illegal referral fees to Guntown, Mississippi residents, labeled “runners,” to identify Medicare cardholders. Dennis Sensing would then market power wheelchairs and back braces to the cardholders. The Sensings also admitted to forging medical records and signatures of a nurse practitioner on medical records to create the appearance that cardholders had been evaluated by a medical provider for medical equipment when, in fact, no provider evaluated the cardholder. Some of the cardholders had no need for the medical equipment.
Nevertheless, the Sensings sent the forged records to Jaspan, which later used the records to obtain payments from Medicare for the equipment.
In February 2015, Calvin Bailey, Sandra Bailey, and Mallard were indicted for conspiracy to commit health care fraud and to pay illegal kickbacks in connection with health care services. Sandra Bailey was also indicted on multiple counts of health care fraud and paying illegal kickbacks to health care providers and patient-referral sources.
In October 2015, the indictment was superseded to add the Baileys’ son, Bryan Bailey, as a fourth defendant, and name the Sensings as persons involved in the conspiracy. Bryan Bailey was indicted for conspiracy to commit health care fraud and to pay illegal kickbacks in connection with health care services. He was also charged with wire fraud.
According to plea agreements entered by the Sensings, medical equipment orders resulting from illegal kickbacks and fraud made by the Sensings resulted in payments by Medicare in an amount between $400,000 and $1,000,000.
On Thursday, the Sensings individually pled guilty before Chief Judge J. Daniel Breen to one count of conspiracy to commit health care fraud and pay illegal kickbacks.
The defendants face individual sentences of up to five years’ imprisonment and a fine of up to $250,000.
Both defendants are scheduled to be sentenced on February 11th at 10 a.m. before Chief Judge Breen.
The case is being investigated by the Department of Health and Human Services—Office of the Inspector General, Federal Bureau of Investigation, and Tennessee Bureau of Investigation.
The case is being prosecuted by Assistant U.S. Attorney John Fabian on the government’s behalf.