Wednesday, July 24, 2013

Former Biller for RGV DME Gets More Than 11 Years in Federal Prison for His Role in $11 Million Health Care Fraud Scheme

MCALLEN, TX—One of the billers for a now-defunct McAllen area durable medical equipment (DME) business has been ordered to prison for his role in a conspiracy and scheme to defraud Medicare and Medicaid through fraudulent billings, United States Attorney Kenneth Magidson and Texas Attorney General Greg Abbott announced today. Ramon De La Garza, 52, of Mission, was a biller for RGV DME from approximately August 2004 through approximately April 2009. The scheme involved approximately $11.1 million in false claims to Medicare and Medicaid. Today, De La Garza, was handed a sentence of 110 months for conspiracy to defraud Medicare and Medicaid and an additional mandatory 24-month-term for aggravated identity theft that must be served consecutively to the other sentence imposed, resulting in a total sentence of 134 months in federal prison.

He will also serve three years of supervision following his release. In addition to the prison sentence, he was ordered to pay restitution to Medicare and Medicaid in the amount of $5,059,198.96, and a money judgment will be entered against him for that amount. De La Garza and former RGV DME owner Marcello Herrera, 40, along with his wife Carla Cantu Herrera, 32, both from Mission, pleaded guilty on February 21, 2013, to conspiring to defraud Medicare and Texas Medicaid. Beatriz Ramos, 28, of Edinburg, another former biller for RGV DME, pleaded guilty to the conspiracy on October 16, 2012.

Marcelo Herrera and De La Garza also pleaded guilty to one count of aggravated identity theft for unlawfully using the identity of a beneficiary to bill Medicare and Medicaid $5,000 for a power wheelchair that was not requested, prescribed, needed or delivered. Marcelo Herrera was sentenced earlier this month to 120 months for the conspiracy, as well as the mandatory 24 months for aggravated identity theft, for a total of 144 months in federal prison. The court ordered him to pay restitution to Medicare and Medicaid in the amount of $6,103,953.74 and that he forfeit wheelchairs, scooters, and other DME items discovered in his leased storage facility in Alamo, which had been rented by him and ultimately seized by the FBI. From early 2004 through late 2011, Marcello Herrera, who did business as RGV DME in the McAllen area, engaged in and directed a scheme to submit fraudulent claims to Medicare and Texas Medicaid for power wheelchairs, scooters, incontinent supplies, hospital beds, and mattresses, as well as other DME supplies.

At various times, his wife—who admitted to being marketing director, chief financial officer, chief operating officer, office manager, human resources manager, and co-owner of RGV DME—and billers De La Garza and Ramos all participated in the conspiracy and aided Marcello Herrera and each other in the submission of fraudulent billings, wire fraud, and theft of the identities of beneficiaries and doctors. In court on February 21, 2013, De La Garza admitted that during his participation in the conspiracy, the fraudulent billing exceed $9.6 million for which payments exceeded $5 million. Marcelo Herrera acknowledged he submitted or caused the submission of more than $11.1 million in false and fraudulent claims to Medicare and Texas Medicaid for which he illegally received in excess of $6.1 million, while Carla Herrera admitted that during her participation in the conspiracy, the fraudulent billings exceeded $9.9 million for which they received illegal payments exceeding $5.5 million. Marcelo Herrera, his wife, and De La Garza also admitted that approximately 85 percent of their Medicare and Texas Medicaid billings were false and fraudulent.

The three defendants in court on February 21, 2013, also admitted that marketers were used to obtain Medicare and Medicaid identification numbers and other information from beneficiaries, which they in turn used to fraudulently bill Medicare and Medicaid for DME that was either never prescribed or prescribed but never delivered. Ramon De La Garza has been in custody since his arrest on June 28, 2012. He will remain in custody pending transfer to a United States Bureau of Prisons facility to be determined in the near future. Sentencing for Carla Herrera and Ramos are set for September 18 and 26, 2013, respectively.

The investigation leading to the charges was conducted by the FBI, the United States Department of Health and Human Services-Office of Inspector General, and the Texas Attorney General’s Medicaid Fraud Control Unit. Special Assistant United States Attorney Rex Beasley and Assistant United States Attorney Grady Leupold are prosecuting the case. 

Reported by: FBI

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