Health Care Fraud

Texas Doctor, Nurses Exploited ‘Trust-Based’ System

Stock image depicting a doctor in a white coat in handcuffs and holding money.

When a federal judge in Texas sentenced a 52-year-old Dallas woman to 10 years in prison recently—and ordered her to pay more than $23 million in restitution to Medicare and Medicaid—it marked the end of a massive health care fraud case in which the government was systematically defrauded and the care of vulnerable patients was placed at risk.

Cynthia Stiger was the last of seven defendants to be sentenced in the long-running scheme. The ringleader, Dr. Jacques Roy, received a 35-year sentence in August 2017 and was ordered to repay the government more than $268 million. Roy and his co-conspirators—some of them nurses—perpetrated a home health care fraud that involved thousands of patients over a period of eight years.

“It’s sad when people in the medical community who enjoy a level of trust and responsibility choose to callously take advantage of sick and elderly patients,” said Special Agent Chelsie Drews, who investigated the case from the FBI’s Dallas Division. “But that is exactly what happened here.”

Dr. Roy, Stiger, and others improperly recruited individuals with Medicare coverage to sign up for home health care services. One co-conspirator, nurse Charity Eleda, sought out patients from a homeless shelter, sometimes paying recruiters $50 for each eligible patient they found. Among their many crimes, the fraudsters falsified medical documents to make it appear as though Medicare patients qualified for home health care services that were not medically necessary

In 2004, when Dr. Roy began to exploit the system, home health care was a relatively new concept. Medicare would pay for doctors to visit patients in their home—usually the elderly or infirm—who might not otherwise be able to receive treatment. “The practice quickly became popular,” Drews said, “and Dr. Roy was intent on capitalizing on that.”

Evidence showed that Dr. Roy approved plans of care for 11,000 unique Medicare beneficiaries. “The more patients he had, the more services he could bill for,” Drews said. “When the case went to trial,” she added, “it was the largest single-physician home health care fraud in the country.” Dr. Roy was certifying patients for Medicare home health services from more than 500 home health companies. “Those kinds of numbers were unheard of in the industry,” Drews said.

“It’s sad when people in the medical community who enjoy a level of trust and responsibility choose to callously take advantage of sick and elderly patients.”

Chelsie Drews, special agent, FBI Dallas

After an individual was certified for services, the fraudsters falsified home visit notes to make it appear as though skilled nursing services were being provided and continued to be necessary. Dr. Roy performed unnecessary home visits and then ordered unnecessary medical services for patients. At his instruction, hundreds of millions of dollars in fraudulent claims were submitted to Medicare. And in many cases, patients were deprived of care or received inferior care.

It took time for the fraud to be discovered, Drews explained, because Medicare and Medicaid are trust-based systems. “There are so many eligible beneficiaries. In order for patients to get the care they need and then to get their claims processed in a timely manner, the system trusts that providers are submitting a true and accurate billing for their services,” she said. Dr. Roy exploited that process.

The case was investigated jointly by the FBI, the U.S. Department of Health and Human Services Office of Inspector General, and the Texas Attorney General’s Medicaid Fraud Control Unit as part of the Department of Justice’s Medicare Fraud Strike Force. Dr. Roy and his co-conspirators were arrested in 2012 on a variety of health care fraud charges.

“We are pleased with the outcome of this case,” Drews said. “The lengthy sentences handed down send a strong message of deterrence to that industry.”