Policy & Regulation News

July 24: Week That Was in Healthcare Fraud and Malpractice

By Jacqueline DiChiara

- Here is a general roundup of the past week’s developments in healthcare fraud and malpractice, as reported by the Department of Justice and the Office of Inspector General. The crimes reported below result in multiple millions of dollars in healthcare fraud and the possibility of extensive prison time.

fraud in healthcare

Sham clinic leader sentenced, “breathtaking” Medicare fraud

Artak Ovsepian was sentenced this week to 15 years in federal prison for his primary involvement in a $20 million scheme to defraud Medicare by continuously rebilling the government for expensive, fraudulently prescribed anti-psychotic medications.

According to US District Judge S. James Otero, Ovespian’s actions to “[prey] on some of those most vulnerable members of society, from the mentally ill, to down-and-out veterans, to elderly victims whose identities were stolen, which then interfered with their ability to obtain medical treatment” were “despicable,” “horrific,” and “particularly devious.”

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  • Patient files were illegally changed to make it appear patients were treated and the drugs they needed were necessary to improve their health. Paid for by Medicare, prescriptions were redistributed to pharmacies as “new bottles of drugs” after their redistribution on the black market. Fraudulent billings topping $20 million were generated; Medi-Cal and Medicare paid over $9 million of this amount.

    In relation to this scheme, another conspiracy leader, Lianna “Lili” Ovespian, was sentenced after pleading guilty to healthcare charges. According  to prosecuters during the sentencing, beneficiaries – including veterans battling drug addiction and schizophrenia, elderly Medicare beneficiaries with now stolen identities, and homeless beneficiaries recruited from skid row – were all taken advantage of. Over 14,000 claims were submitted in total in the largest Medicare Part D fraud case in Southern California. Said Judge Otero, “The scope of the fraud was breathtaking.”

    One of the individuals also involved in this case, Nuritsa Grigoryan, is listed in the OIG’s Most Wanted Fugitives report for allegedly removing her ankle monitor and fleeing to either the Los Angeles area or Armenia following her June 2014 sentencing.

    Pennsylvania “therapists” face Medicaid fraud lawsuit

    “Therapists” who were not actually qualified to provide mental health services did so without supervision at Northeast Community Mental Health Centers (in Philadelphia, PA) Leigh Valley Community Mental Health Centers (in Allentown, Easton, and Bethlehem PA), and North Carolina Community Mental Health Centers (in Raleigh, NC), three community mental health clinics primarily funded through Medicare and Medicaid.

    Melchor Martinez and Melissa Chlebowshi, both of Allentown, PA, face a civil healthcare fraud lawsuit for violation of the False Claims Act. According to the Department of Justice, Medicaid was billed for psychiatrist visits that sometimes lasted less than 3 minutes but were reported as 15 minute visits. 

    “This civil complaint reflects our focus on pursuing individuals who defraud Medicaid and Medicare, especially after they have previously defrauded those programs and been barred from participating in them,” says US Attorney Zane David Memeger.