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Florida Defendant Sentenced to 10 Years in Prison for
Medicare Fraud

WASHINGTON – The owner and operator of a Florida health care company has been sentenced to 10 years in prison for Medicare fraud, Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida announced today.

Gisela Valladares was sentenced yesterday afternoon by U.S. District Judge Michael K. Moore at the federal court in Miami. Judge Moore also ordered Valladares to pay approximately $1.7 million in restitution for submitting more than $3 million worth of fraudulent claims to the Medicare program. Valladares owned and operated PRN Home Health Care, Inc., a Miami medical equipment company involved in a scheme to defraud Medicare. She was convicted on five charges following a three-day trial in June 2007.

At trial, the government called witnesses who testified that Valladares had been paying kickbacks to Medicare beneficiaries throughout Miami-Dade County to gain access to their Medicare information. After gaining access to their Medicare cards, Valladares billed Medicare for unnecessary services on behalf of these patients, including oxygen concentrators and nebulizers. Several of these patients testified that Valladares paid them in cash and that they did not need the treatments or medication. Further, they testified that they disposed of the medication that was paid for by Medicare by throwing it in the trash. The patients testified that they participated in the scheme because they needed the money. According to trial testimony, Valladares paid $100 per month if the patients agreed to accept unneeded aerosol medications, such as Albuterol, and related respiratory equipment, such as oxygen concentrators.

Valladares obtained the compounded aerosol medications from convicted co-conspirator pharmacies owners in Miami. From 2000 to 2003, these pharmacies billed the Medicare program for over $17 million.

The case was prosecuted by Trial Attorney Hank Bond Walther from the Fraud Section of the U.S. Department of Justice in Washington, D.C., and Robert DeConti, a Special Trial Attorney in the Fraud Section, with investigative assistance of the U.S. Department of Health and Human Services, Office of the Inspector General, the FBI, and the Medicaid Fraud Control Unit from the State of Florida.

This case was part of an initiative started with the creation in March 2007 of the Medicare Fraud Strike Force, which is led by the Fraud Section in Washington, D.C. and the U.S. Attorney’s Office in the Southern District of Florida. The Strike Force operates out of the federal Health Care Fraud Facility in Miramar, Fla. The Strike Force has brought over 80 cases involving 120 defendants since March 1, 2007.