Physician Pleads Guilty for Role in Detroit-Area Medicare Fraud Scheme

A Detroit-area physician pleaded guilty today for his role in a $7 million health care fraud scheme.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office made the announcement.

Walayat Khan, 66, of Ypsilanti, Michigan pleaded guilty before U.S. District Judge Paul D. Borman in the Eastern District of Michigan to one count of conspiracy to commit health care fraud. Sentencing is scheduled for Oct. 7, 2014.

According to court documents, beginning in January 2009, Dr. Khan and others agreed that he would refer Medicare beneficiaries to Advance Home Health Care Services, Inc. (Advance HHC), Perfect Home Health Care Services, LLP (Perfect HHC), and other Detroit-area home health care agencies for medically unnecessary home health services. Dr. Khan signed medical documents, such as home health care certifications and plans of care for these beneficiaries, falsely certifying that they required home health care and they were under his care. Advance HHC, Perfect HHC, and other home health care agencies then used Dr. Khan’s false documents to support their claims to Medicare for home health services—including physical therapy services—that were never rendered and/or not medically necessary. Dr. Khan knew the medical documents he signed for his co-conspirators would be used to support false claims to Medicare.

Additionally, in exchange for signing the home health care documents, Dr. Khan received and accepted cash kickbacks and other forms of payment from home health agency owners, and Dr. Kahn paid kickbacks to a doctor in exchange for that doctor falsely certifying patients for home health care that would be billed to Medicare.

As further alleged in court documents, Dr. Khan used patient recruiters to recruit Medicare beneficiaries to his practice. Dr. Khan and one recruiter agreed that the recruiter would refer Medicare beneficiaries to Dr. Khan in exchange for Dr. Khan writing controlled substance prescriptions for the beneficiaries and paying cash to the recruiter. Another recruiter transported patients to Dr. Khan’s medical practice so that Dr. Khan would write the patients medically unnecessary prescriptions for controlled substances, bill Medicare for physician services purportedly provided to the patients, and refer the patients for medically unnecessary home health care services at Advance HHC, Perfect HHC, and other home health care agencies.

Dr. Khan billed Medicare and caused Medicare to be billed for medically unnecessary controlled substances, physician services, and home health services. These false and fraudulent claims to Medicare totaled approximately $6,123,044.28 in billings, of which $5,504,733.31 was paid.

This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan. This case is being prosecuted by Special Trial Attorney Katie R. Fink and Trial Attorney Patrick J. Hurford of the Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,900 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .