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Nursing Home Mogul Convicted for Largest Medicare Fraud Scheme Ever by DOJ -- $1.3B

Alabama nursing home attorney

In April, the U.S. Department of Justice announced the largest healthcare fraud scheme it has ever charged. Philip Esformes of Miami Beach, Florida was found guilty for the role he played in a fraud scheme involving more than 1.3 billion in fraudulent Medicare and Medicaid claims. He was sentenced last month to 20 years in prison. His sentence also includes three years of supervised release.

How Esformes defrauded Medicare and Medicaid

From January 1998 to July 2016, Esformes's fraudulent conspiracy impacted residents in a network of nursing homes and assisted living facilities he owned. Patients were admitted into his facilities by physicians through bribery. There were reportedly no services actually provided from many of the claims.

Those that were provided were either medically unnecessary or were procured through the payment of kickbacks. Throughout the process, Medicare and Medicaid were fraudulently billed for non-existent or unnecessary services.

According to witnesses, Esformes's facilities were in poor condition and patients weren't properly cared for. In order to hide this from authorities, Esformes bribed a Florida state regulator to provide advanced notice of surprise inspections at his facilities.

Through his fraudulent scheme, Esformes profited more than $37 million, which he reportedly spent on luxury cars and a $360,000 watch, as well as other extravagant purchases.

The investigation and trial

Arnaldo Carmouze, a physician's assistant and Esformes's co-conspirator, pleaded guilty to conspiracy to commit health care fraud. Another co-conspirator, Odette Barcha, pleaded guilty to one count of conspiring to violate the anti-kickback statute.

The investigation was carried out by the FBI and HHS-OIG as part of the Medicare Fraud Strike Force — an operation led by the Criminal Division's Fraud Section and the U.S. Attorney's Office for the Southern District of Florida.

Fraud, kickbacks, conspiracy, obstruction and money laundering

Following an eight-week trial, Esformes was convicted of the following:

  • Conspiracy to defraud the United States — 1 count
  • Receipt of kickbacks in connection with a federal healthcare program — 2 counts
  • Payment of kickbacks in connection with a federal healthcare program — 4 counts
  • Conspiracy to commit money laundering — 1 count
  • Money laundering — 9 counts
  • Conspiracy to commit federal program bribery — 2 counts
  • Obstruction of justice before — 1 count

“I commend our dedicated prosecutors and law enforcement partners for their professionalism and unyielding pursuit of justice on behalf of American taxpayers and vulnerable beneficiaries who, as a result of Esformes’s crimes, were denied the level of care that they needed and deserved,” said Assistant Attorney General Benczkowski.

This type of abuse of Medicare and Medicaid, as well as our elders who reside in nursing homes and assisted living facilities, is unacceptable. At Shuttlesworth Law Firm LLC, we applaud the efforts of the Department of Justice and all other state and federal agencies involved in bringing Esformes and his co-conspirators to justice.

If your loved one has suffered due to abuse or neglect, our legal team — based in Birmingham, Alabama — can launch a thorough investigation and fight to pursue justice for you and your family. To schedule your free case evaluation, contact us online today.

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