California addiction treatment CEO faces federal charges

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Unbeknownst to Tarek Greiss, the feds have been already listening.

The CEO of Beginnings Remedy Facilities and South Coast Counseling in Costa Mesa — who “entered the world of habit restoration by the entrance door, as a consumer” — was on the telephone along with his Tustin advertising agency, SeKe. It was March 18, 2019, and a brand new federal legislation, the Eliminating Kickbacks in Restoration Act of 2018, had kicked in simply months earlier than. The legislation makes giving or receiving cash in change for habit therapy referrals a federal crime.

Greiss mentioned he “was hungry for admissions” and low on detox-eligible sufferers — the individuals who deliver within the greatest insurance coverage payouts, in response to a federal indictment filed under seal Sept. 16. He mentioned the financial worth of 19 folks — values primarily based on the insurance coverage reimbursements they might generate — and in contrast that to funds already made to SeKe underneath a advertising companies settlement that prosecutors referred to as a “sham.”

That advertising settlement — whereby Greiss paid SeKe a flat price of $30,000 a month — was designed to satisfy the brand new legislation’s necessities by not basing funds on the variety of people referred for therapy. However Greiss mentioned he’d “quite get admissions” than get a refund from SeKe, undercutting the concept that funds weren’t tied to affected person quantity, the indictment asserts.

Greiss, who was an anesthesiologist earlier than habit value him his medical license in Nevada and he entered the therapy trade in California, is amongst 345 folks charged in a what the U.S. Division of Justice is looking “a historic nationwide enforcement action” that has ensnared greater than 100 docs, nurses and different licensed medical professionals for all kinds of alleged well being care fraud.

Greiss pleaded not responsible to conspiracy and “unlawful remunerations for referrals to medical therapy services” on Sept. 28 and was launched on a $10,000 bond signed by his mom in Walla Walla, Wash. Trial is slated for November.

“Mr. Greiss is harmless and intends to problem the federal government’s allegations at trial,” mentioned his lawyer, John L. Littrell, a companion with Bienert | Katzman, which has an workplace in San Clemente. “That is an trade with plenty of dangerous actors, however Mr. Greiss just isn’t one in every of them.

“These allegations don’t have anything to do with the standard of the care Greiss supplies to his sufferers,” Littrell added. “He has helped numerous folks endure probably the most tough intervals of their lives and go on to attain lasting sobriety.”

Beginnings Remedy Facilities, a for-profit enterprise, has a number of detox services in Costa Mesa, according to state records. South Coast Counseling, in the meantime, is registered as a nonprofit. It reported income of $8.4 million, and bills of $8.1 million, in 2018, the newest 12 months accessible, according to documents filed with the IRS..

‘Abused alongside the way in which’

Brian C. Rabbitt, Appearing Assistant Lawyer Common for the Felony Division, U.S. Division of Justice 

The huge federal crackdown prices defendants with submitting greater than $6 billion in fraudulent claims to federal well being care applications and personal insurers. That features some $4.5 billion related to telemedicine schemes; $845 million related to substance abuse therapy or “sober house” schemes; and one other $806 million in different well being care fraud and unlawful opioid distribution schemes.

“These ‘sober houses’ circumstances are notably egregious, not simply due to the substantial quantities of economic loss they trigger, but additionally due to the numerous hurt they trigger to sufferers who’re used and abused alongside the way in which,” mentioned Appearing Assistant Lawyer Common Brian C. Rabbitt in asserting the crackdown on Sept. 30.

“In lots of of those circumstances, defendants are alleged to have preyed upon addicted sufferers, recruiting them from their hometowns, the place they’ve assist networks, and delivery them off to far-away states the place they’re positioned into these so-called ‘sober houses.’ As soon as there, these susceptible sufferers are sometimes supplied with medicine that undercut their skill to get well from the habit they’re making an attempt to kick, and they’re typically shuffled from facility to facility to spice up headcount and maximize billing, as a substitute of being given the care they so desperately want.”

In a number of the extra troubling circumstances — an excellent many filed in Florida — some sufferers have been additionally referred to different healthcare suppliers who, in return for kickbacks, billed for medically pointless exams, drugs and companies. “This fraud and abuse really inflict a human — not simply monetary — toll on their victims,” Rabbitt mentioned.

Many of those prosecutions are the direct results of “the pioneering use of information to strategically goal wrongdoing” in healthcare and opioid prescription and distribution, he added.

Within the Central District of California, which incorporates Los Angeles and Orange counties, six folks have been charged in various schemes to defraud insurance coverage applications of greater than $48 million, the DOJ mentioned. They embrace allegations that:

  • Minas Kouchumian, a health care provider from Tarzana who owned and operated California Medical and Rehabilitation Group in Northridge, billed Medicare $20 million between 2013 and 2019 and was reimbursed $7 million for drainage of tailbone cysts, removing of growths, and injections of medication to deal with osteoporosis and osteoarthritis that he by no means truly supplied, in response to court docket paperwork. He pleaded not responsible.
  • Christian Mohases of Santa Ana, who owned and operated a number of name facilities, was charged with acquiring docs’ orders for orthotic braces and affected person referrals for genetic most cancers screening exams. His corporations then supplied these orders and referrals to medical corporations in change for bribes, court docket paperwork allege. He pleaded guilty.
  • John Paul Thropay of Arcadia, a health care provider who labored for Blue Sky Hospice from 2014 to 2016, allegedly participated in a scheme to defraud Medicare, in response to his indictment. Blue Sky’s homeowners paid unlawful kickbacks of lots of of {dollars} per affected person for every month the affected person remained in hospice. Thropay is accused of doing cursory examinations with out consulting medical data earlier than certifying that the sufferers have been terminally ailing — typically once they weren’t, in response to court docket paperwork. He pleaded not responsible. “Dr. Thropay will vigorously contest the allegations and appears ahead to being acquitted,” mentioned lawyer Michael J. Khouri. “He’s a really achieved radiation oncologist and there would have been no purpose to overcharge Medicare.”
  • Marc Hoang was accused of creating false statements to the DEA to resume the managed substances registration of Infinite Well being Options, Inc., a Los Angeles firm, although he was not an officer or level of contact for the corporate. He pleaded not responsible.

In September, Kevin M. Dickau, 32, of Tustin, pleaded guilty to at least one depend of conspiracy to commit well being care fraud. He’s listed as chief government for SeKe, Inc., the advertising firm for Greiss, on papers filed with the Secretary of State.  Akikur Mohammad, 57, a doctor from West Hills, pleaded guilty to at least one depend of conspiracy to violate the Eliminating Kickbacks in Restoration Act.

Battle

Costa Mesa’s Katrina Foley addressed federal leaders in regards to the sober dwelling trade in Washington D.C. (File photograph) 

Costa Mesa, a metropolis that’s de-facto floor zero for Southern California’s troubled habit therapy trade, with extra licensed habit rehabs per capita than anyplace besides Malibu, is battling operators in state and federal courts.

Costa Mesa is in federal court docket with seven circumstances and has gained motions for abstract judgement in 5 of them, that means that judges dominated within the metropolis’s favor with out seeing a necessity for a trial. It additionally has gained sanctions value some $200,000 towards operators, although it has but to gather any of that cash. The town additionally has prevailed in state court docket and is finalizing plans to close down three operations, mentioned Seymour B. Everett III, companion with Everett Dorey, the legislation agency representing the town.

Greiss’s operations, although, haven’t been topic to any of these enforcement actions or lawsuits, officers mentioned.

Mayor Katrina Foley was happy with the federal actions and hopes they ship the message that if folks break the legislation, they’ll be prosecuted.

“The town will proceed to make clear the prison actions of sure sober dwelling house operators to guard its residents and prosecute operators who illegally function in Costa Mesa,” she mentioned.

Costa Mesa is right down to about 92 sober houses from some 300 a number of years in the past, Foley mentioned, suggesting the town’s technique is working.

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