The Department of Justice announced criminal charges against five people and one North Carolina company as part of a wide-scale probe into Medicare and Medicaid fraud. The DOJ also announced that several others were convicted in an ongoing investigation into a Raleigh facility.
The new charges stem from Medicaid kickbacks to patients in exchange for attending substance abuse services, and from false and fraudulent billings to Medicare for durable medical equipment, said Acting United States Attorney Daniel P. Bubar.
“Fraud against our healthcare system is not a victimless crime — it threatens patient care, burdens taxpayers, and undermines trust in critical programs,” Bubar said. “Today’s charges demonstrate our office’s resolve to pursue those who attempt to profit by violating federal law and jeopardizing public resources.”
Kimberly Mable Sims, an owner, Francine Sims Super, office manager, and Keke Komeko Johnson, compliance officer, were all charged by information in connection with the payment of more than $1 million in illegal remunerations in the form of gift cards to patients of Life Touch, LLC (Life Touch), a Kinston-based substance abuse treatment company. At this time, Kimberly Sims is the only one who has pleaded guilty. The three are also accused of making false statements to Medicaid auditors. The inducements resulted in more than $25 million in payments from Medicaid to Life Touch, the DOJ said.
“Today’s record-setting Health Care Fraud Takedown sends a crystal-clear message to criminal actors, both foreign and domestic, intent on preying upon our most vulnerable citizens and steal from hardworking American taxpayers: we will find you, we will prosecute you, and we will hold you accountable to the fullest extent of the law,” said Attorney General Pamela Bondi. “Make no mistake — this administration will not tolerate criminals who line their pockets with taxpayer dollars while endangering the health and safety of our communities.”
Life Touch, which was formed in 2009, provided substance abuse services to Medicaid recipients at two locations in Goldsboro and Kinston.
“What we’re interested in doing is recouping that money. It’s part of the waste, fraud and abuse that goes on in this country where healthcare is already so expensive,” Bubar told ABC11.
According to Bubar, the investigation into Eastern North Carolina cases spanned several years and totaled $65 million in fraudulent billings.
Under the scheme, patients were told if they attended outpatient substance abuse meetings five times a week, they would receive a $60 gift card. If they attended meetings four times a week, they would receive a $50 gift card. Lastly, if they attended three times a week, they would receive a $45 gift card.
Authorities said that during a four-year span, Life Touch routinely paid patients based on the number of days per week that they received services. Life Touch staffers also allegedly received kickbacks from a lab company that it used for drug testing services.
Super and Johnson were also charged with failure to file a tax return. Life Touch and Brandon Eugene Sims were previously charged in this case.
Federal prosecutors said by incentivizing Medicaid recipients to attend Life Touch, they were able to attract, retain and bill Medicaid for years of substance abuse services. Court records show that during the life of the scheme, Life Touch allegedly received as much as $25 million in North Carolina Medicaid proceeds. Bubar said an audit launched this investigation, and his office seized $6 million in assets from the company, comprising cash, real estate, and other assets.
“Life Touch was supposed to be providing substance abuse care for a segment of the population that really needed it. These are folks who are struggling from alcohol or drug abuse addiction,” said Bubar.
Another case that is part of this federal effort identifies Randal Fenton Wood, 56, of Flagler Beach, Florida, in connection with a durable medical equipment case targeting the elderly. Federal prosecutors allege in court records that Wood used his Winston-Salem-based company to ship and deliver medically unnecessary equipment for Medicare recipients, in turn submitting false claims to Medicare for reimbursements.
“These are allegations in Mr. Wood’s case, but there’s a total of $39 million in fraudulent Medicare reimbursements that were part of his case as alleged,” said Bubar.
Wood was charged with conspiracy to commit health care fraud in connection with a scheme to bill Medicare, the Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA), and other insurance programs.
Bubar also said several people pleaded guilty in connection with an investigation into billing and documentation practices by Medicaid mental health providers Our Treatment Center and Partners Against Sexually Transmitted Diseases, which operated in Raleigh.
“They were carrying out treatment for people who didn’t need it. They were preying on an immigrant population from places like Syria and Afghanistan,” he said.
Bubar said his criminal investigation and its results reinforce a commitment to stamping out waste, fraud and abuse in the healthcare system. He told ABC11 that the goal is to hold people accountable and recoup as much money as possible.
“We want to recoup the money. We want to seize assets and seize land,” he said.
Seven people pleaded guilty to conspiracy to make and use materially false writings and documents relating to health care matters: Dawn Marie Meacham, 61, of Raleigh, a licensed clinical mental health counselor; Kim Jones Kelly, 68, of Greenville, a licensed clinical addiction specialist; Pius Ondachi, 54, of Raleigh, a licensed clinical mental health counselor; Tequila Vinson Bogan, 48, of Smithfield, a licensed clinical mental health counselor; Ifeoma Ezugwu, 56, of Raleigh, a licensed clinical social worker associate; Queensly Onuzulike, 49, of Raleigh, a licensed clinical social worker; and Tamika Rochaelle Autry, 29, of Wilson, a certified peer support specialist and qualified practitioner. All seven face up to five years of imprisonment at sentencing.
“These people were entrusted to help provide health care and necessary medical tests to patients, but instead they used patients’ information to commit Medicaid fraud,” said North Carolina Attorney General Jeff Jackson. “I’m grateful for the work of our office’s Medicaid Investigations Division to hold these fraudsters accountable, as well as the partnerships with federal and state law enforcement and prosecutors that helped get this done. We’ll make sure anyone who abuses taxpayer dollars is held accountable.”
ABC11 reached out to attorneys for all of the people charged in this effort. All those who responded declined to comment.
Since its inception in March 2007, the Health Care Fraud Strike Force, which operates in 27 districts, has charged more than 5,400 defendants who collectively billed Medicare, Medicaid, and private health insurers more than $27 billion.
