Four Texans have been indicted for allegedly carrying out a complicated scheme that allowed an unlicensed orthotist to bill more than one million dollars to Medicare while sending kickbacks to the licensed, certified orthotists who pretended to provide the services for which the unlicensed orthotist billed. Each face 11 counts of healthcare fraud, with a maximum penalty of 110 years in prison and $2.75 million in fines.
According to acting United States Attorney Tim Johnson and Texas Attorney General Greg Abbott, 43-year-old Jeanette Garcia, the owner of Orthopedic Specialists DME, Corpus Christi, and her husband, Eleazar (Eli) Garcia, 52, both of Corpus Christi, were indicted by a federal grand jury on March 25, as were John D. Martinez, CO, 50, and his brother, Frank D. Martinez, CO, 46, co-owners of San Antonio Orthotics & Artificial Limbs, San Antonio. The indictment was the result of a three-and-a-half-year joint investigation conducted by agents of the Texas Attorney General’s Medicaid Fraud Control Unit in Corpus Christi, the U.S. Department of Health & Human Services (HHS) Office of the Inspector General (OIG), and the Federal Bureau of Investigation (FBI).
All four defendants are charged with conspiracy and with multiple counts of healthcare fraud for submitting or assisting in the submission of false or fraudulent claims to Medicare and Medicaid for orthotic and prosthetic goods furnished by Eli Garcia and or Orthopedic Specialists DME.
The indictment alleges that Jeanette Garcia hired her husband, Eli Garcia, to provide orthotic and prosthetic goods and services to diabetic patients and others on behalf of Orthopedic Specialists DME, though Eli Garcia has never held a license to practice orthotics in Texas. According to the U.S. Department of Justice, Garcia had taken and failed the test to become a licensed orthotist five times and has been under an order from the Texas Board of Orthotics and Prosthetics to cease and desist practicing orthotics since October 9, 2001.
The indictment alleges that on and before December 31, 2001, Orthopedic Specialists DME did not have a licensed orthotist onsite as required by Texas law, and the Texas Board of Orthotics and Prosthetics did not renew the company’s facility accreditation in January 2002. Because Orthopedic Specialists DME had lost its state facility accreditation, its Medicare provider number was revoked effective December 31, 2001.
The indictment next alleges that beginning in February 2002 and continuing until at least December 23, 2008, the Garcias and the Martinez brothers filed paperwork stating that one or both of the Martinez brothers were and would be the licensed orthotists onsite at Orthopedic Specialists DME, allowing the company to regain and maintain its facility accreditation and Medicare provider number. According to the Department of Justice, Eli Garcia then continued to supply orthotic and prosthetic goods and services through the company, which billed Medicare and Medicaid for his work and then paid kickbacks to the Martinez brothers.
The indictment alleges that for the period of March 4, 2002, through December 23, 2008, the defendants submitted fraudulent claims to Medicare and Medicaid that totaled some $1,161,185, for which Orthopedic Specialists DME was paid approximately $800,529. Orthopedic Specialists DME then paid about $642,969 to San Antonio Orthotics & Artificial Limbs, which is owned by the Martinez brothers.
The Garcias surrendered to the U.S marshal in Corpus Christi on the morning of March 27, and had their first appearance before the magistrate in Corpus Christi, while Frank and John Martinez surrendered to the U.S. marshal in San Antonio and had their first appearance before the magistrate there. All defendants were released on $100,000 bonds and are due back in court in Corpus Christi for arraignment on April 1, 2009, at 10 a.m.
The case is being prosecuted by Assistant U.S. Attorney Michael Hess and Special Assistant U.S. Attorney Rex G. Beasley.