Recruiter in Multi-Million-Dollar Health Care Fraud Scheme Pleads Guilty to Conspiracy to Violate the Anti-Kickback Statute

HOUSTON—An accused recruiter in a multi-million-dollar health care fraud scheme scheduled for trial on Monday has instead pleaded guilty to conspiracy to violate the Anti-Kickback Statute, United States Attorney José Angel Moreno announced today. Birdie Leroy Revis, 60, of Houston, pleaded guilty before United States District Judge David Hittner this morning to conspiracy to violate the Anti-Kickback Statute. Trial had been scheduled to begin with jury selection on Monday, Aug. 8, 2011.

Revis was a recruiter for Sefan Medical Supply (Sefan), a durable medical equipment provider, located in Houston. Based upon the joint investigative efforts of the agencies comprising the Medicare Fraud Strike Force into a $2.8 million scheme to defraud Medicare by Sefan, evidence was obtained proving that Revis’ role in the scheme was to provide Medicare beneficiary information to Sefan. Sefan, in turn, then billed Medicare for medically unnecessary durable medical equipment and supplies which were either not provided to Medicare beneficiaries or a lesser product from what was billed to Medicare was provided. The information was provided on a prescription form for arthritis kits. All the kits included a knee adjustment with air chamber, rigid frame back brace, elbow with joint, ankle gauntlet, flex glove with elastic finger, heat lamp with stand, and a wrist brace. Sefan would order these items for both the left and right side. If the beneficiaries received any items, they did not receive the rigid brace items billed to Medicare—instead they would receive neoprene sleeves, which was not covered by Medicare.

Revis provided to Sefan information for more than 686 beneficiaries for which Sefan paid Revis approximately $400 per beneficiary for a total of more than $353,000. With the information provided by Revis, Sefan billed Medicare for more than $2.8 million worth of claims for arthritis kits and was paid more than $1.7 million for those fraudulent claims.

Revis remains on bond pending sentencing, which is set on Nov. 2, 2011. Revis faces a maximum of up to five years in prison, to be followed by up to a three-year term of supervised release and a fine of up to $250,000 for the kickback conspiracy conviction.

The owner of Sefan and the physician whose signature was on the prescriptions have also been convicted following their respective pleas of guilty to conspiracy to commit health care fraud. Kate Ose Olear, the owner of Sefan, was sentenced to 57 months in prison on Feb. 10, 2011, by United States District Judge David Hittner. John Edward Perry III, the physician, pleaded guilty in June 2010. He remains on bond pending his sentencing on Oct. 21, 2011, before United States District Judge Gray H. Miller.

The investigation leading to the charges in this case was conducted by the Medicare Fraud Strike Force comprised of agents with the Department of Health and Human Services, Drug Enforcement Administration Diversion Division, Texas Attorney General Medicaid Fraud Control Unit, United States Railroad Retirement Board, and the FBI. Assistant United States Jennifer Lowery and Special Assistant United States Attorney Justin Blan are prosecuting the case.