Five Individuals Sentenced for Their Role in Medicare and Medicaid Fraud Scheme in Florida, Nicaragua, and the Dominican Republic
FIVE RESIDENTS OF MIAMI—Dade County and one resident of Nicaragua were sentenced yesterday for their participation in a $25.2 million Medicare, Medicaid, and wire fraud scheme. Erendira V. Delgado, a/k/a “Eren Delgado,” 31, of Miami, Edgardo Rodriguez, 47, of Nicaragua, Rodney Montoya, 36, of Miami, Deborah Smith, 53, of Hialeah, and Augustin Abaga, 48, of Sunny Isles, were sentenced by U.S. District Court Judge Federico A. Moreno in Miami.
Delgado was sentenced to 40 months’ imprisonment. E. Rodriguez was sentenced to 42 months’ imprisonment. Montoya was sentenced to 48 months’ imprisonment. Smith was sentenced to 15 months’ imprisonment. Abaga was sentenced to 18 months’ imprisonment. Each defendant was sentenced to serve a three year term of supervised release upon completion of their incarceration and pay restitution to the Centers for Medicare and Medicaid Services.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Pam Bondi, Florida Attorney General, Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and David Brown, Acting Special Agent in Charge, U.S. Department of State, Diplomatic Security Service (DSS), made the announcement.
On October 30, 2014, a federal grand jury in Miami returned a 36-count indictment charging Pedro Hernandez, a/k/a “Peter Hernandez,” 51, of Miramar, Freddy Zeron, 52, of Miami and Nicaragua, Delgado, E. Rodriguez, R. Montoya, Santiago Bernabe Montoya, 72, of Miami, Jose Eloy Sanchez, a/k/a “Jose Eloy Sanchez Arguello,” 70, of Coral Gables and Nicaragua, Abram J. Rodriguez, a/k/a “Abe Rodriguez,” 31, of Miami, Mirna L Blanco, 49, of Hialeah, Smith and Abaga for allegedly participating in a scheme to defraud Medicare and Medicaid by submitting false and fraudulent enrollment applications which claimed that beneficiaries resided in Florida when, in fact, they resided in Nicaragua and the Dominican Republic. The defendants were charged with conspiracy to commit health care fraud and wire fraud, substantive counts of health care fraud, conspiracy to defraud the United States and make false statements related to health care matters and substantive counts of making false statements related to health care matters.
Beginning on November 19, 2014, ten of the eleven individuals charged in the Indictment were arrested. Sanchez remains at large and is believed to be in Nicaragua. All ten individuals arrested pleaded guilty in federal court. Hernandez and A. Rodriguez pleaded guilty on Friday, June 19, 2015. Zeron pleaded guilty on Tuesday, June 23, 2015. S. Montoya pleaded guilty on May 14, 2015. They are scheduled to be sentenced on August 27, 2015, at 9:30 a.m. before the U.S. District Court Judge Federico A. Moreno.
Previously, on May 5, 2015, Blanco was sentenced to 24 months’ imprisonment after pleading guilty to conspiracy to commit wire fraud and health care fraud.
As part of the indictment, a Temporary Restraining Order (TRO) was obtained against A. Rodriguez and Montoya. Pursuant to the TRO, various banks froze over $150,000 that were allegedly held in the defendants’ accounts, in order to enjoin the ongoing fraud and restrain the dissipation of fraudulent proceeds.
According to allegations contained in the indictment, Florida Healthcare Plus (“FHCP”) was authorized by the Centers for Medicare and Medicaid Services to offer Medicare Advantage HMO plans to Medicare beneficiaries residing in Miami-Dade County, among other counties in Florida. The defendants recruited individuals who resided in Nicaragua and the Dominican Republic to enroll in Medicare Advantage plans and Florida Medicaid by falsely and fraudulently representing in enrollment applications that they resided in Florida. In these enrollment applications, the defendants represented that the foreign residents resided in Florida by using non-residential addresses, the addresses of beneficiaries’ friends and relatives, and addresses associated with the defendants. The defendants induced the individuals residing in Nicaragua and the Dominican Republic to enroll in Medicare Advantage plans, including FHCP plans, by making false and fraudulent representations, including that Medicare benefits were available in Nicaragua and the Dominican Republic. As a result of the submission of these false and fraudulent enrollment applications, the defendants caused the Center for Medicare and Medicaid services to make monthly capitation payments to FHCP and other Medicare Advantage plans. The defendants also caused the Florida Medicaid program to pay Medicare premiums and deductibles for many beneficiaries who did not reside in Florida, a benefit for which non-Florida residents would not be entitled.
Additionally, the defendants caused individuals associated with Pharmovisa Inc., Axis Le Professional Medical Group, Inc. (“Axis Le”), and Rodney Montoya Corp. in Miami, where defendant Montoya was employed as a doctor, to be designated as the primary care physicians for the beneficiaries residing in Nicaragua and the Dominican Republic. The defendants paid for the beneficiaries to travel from the Dominican Republic so that they could be seen by a U.S. licensed physician. The physician would then provide diagnoses which were used to calculate the amount of money Florida Health Care Plus and other Medicare Advantage plans would receive from Medicare. As a result of these false and fraudulent enrollment applications, the defendants obtained approximately $25,247,413 from Medicare and Florida Medicaid.
According to the indictment, Hernandez was the chief operating officer of FHCP until May 8, 2013, A. Rodriguez was the marketing director until on or about April 21, 2014. E. Rodriguez, Smith and Abaga were insurance agents employed by FHCP during the time of the scheme occurred. Blanco was employed by FHCP, as well as, Axis Le and Rodney Montoya Corp.
U.S. Attorney Wifredo A. Ferrer stated, “Health care fraud cripples the American social service system by increasing health care costs, stealing taxpayer monies that support the Medicare and Medicaid programs, and robbing individuals of quality of life benefits. This case demonstrates that, with the assistance of law enforcement partners, the U.S. Attorney’s Office is able to successfully combat these fraud schemes even when the offenders move the crime outside our shores.”
“This elaborate $25 million Medicare and Medicaid fraud scheme essentially stole millions of taxpayer dollars, and thanks to my Medicaid Fraud Control Unit and our partnerships with federal authorities, these individuals will be held accountable for their brazen actions,” said Attorney General Pam Bondi.
“Greed does not respect the law, does not concern itself with patient welfare and is not limited by international borders. Medicare patients and American taxpayers deserve better,” said Shimon R. Richmond, Special Agent in Charge, Office of Inspector General of the U.S. Department of Health and Human Services. “Working closely with our partners we will meet this greed at every turn and bring these criminals to justice.”
“These fraudsters attempted to cheat Medicare and Medicaid by falsely claiming that beneficiaries resided in Florida when in fact they were living in Nicaragua and the Dominican Republic. A novel idea, but not enough to thwart the hard work and diligence of the agents investigating this matter,” said George L. Piro, Special Agent in Charge, FBI Miami. “A special thanks goes to the U.S. Embassy Managua for their close cooperation and support.”
“The worldwide presence and investigative capabilities of the Diplomatic Security Service places us in the unique position to identify criminals who would defraud the U.S. government,” said David Brown, Acting Special Agent in Charge of the Miami Field Office of the Diplomatic Security Service. “Regardless of where they hide, we are able to work with our law enforcement partners—both domestically and around world—to bring these criminals to justice.”
Mr. Ferrer commended HHS-OIG, FBI, the Florida Office of the Attorney General, Medicaid Fraud Control Unit, and DSS for their investigative efforts.
Mr. Ferrer also thanked U.S. Department of State, Diplomatic Security Service, Regional Security Office, at the U.S. Embassies in Managua and Santo Domingo for their assistance with this investigation.
This case, brought as part of the Medicare Fraud Strike Force, under the supervision of U.S. Attorney’s Office for the Southern District of Florida, is being prosecuted by Assistant U.S. Attorney Eric E. Morales and Special Assistant United States Attorney Hagerenesh Simmons.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 2,300 defendants who collectively have falsely billed the Medicare program for more than $7 billion. In addition, the 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.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.