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Debra Wong Yang
United States Attorney
Central District of California


United States Courthouse
312 North Spring Street
Los Angeles, California 90012
Release No. 06-126

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PRESS RELEASE

FOR IMMEDIATE RELEASE
September 25, 2006
For Information, Contact Public Affairs
Thom Mrozek (213) 894-6947

SOUTHERN CALIFORNIA DOCTOR SENTENCED TO 15 YEARS FOR DEFRAUDING MEDICARE PROGRAM OUT OF $3.1 MILLION


Los Angeles, CA - A Southern California doctor was sentenced this morning to 15 years in federal prison for fraudulently billing Medicare and Medi-Cal more than $3.1 million for respiratory treatments on mentally ill people that were unnecessary, not performed in accordance with Medicare's rules, or not performed at all.

Aziz F. Awad, 43, of Pasadena, was sentenced by United States District Judge James V. Selna, who called Awad's conduct "egregious" because he targeted mentally ill people and violated his duty as a physician. In addition to the prison term, Judge Selna ordered Awad to pay $2.5 million in restitution.

Awad and his biller, Herman Thomas, 47, of Bellflower, were convicted by a Santa Ana federal jury in December 2005 of 24 counts of health care fraud and four counts of money laundering. Awad operated a medical practice, Active Care Medical Group in Anaheim. Thomas operated a billing company, HT Medical Billing Service, and a respiratory therapy company, Professional Respiratory Care Services, both of which were located in Bellflower.

The evidence presented at trial showed that Awad and Thomas engaged in a scheme that targeted mentally ill residents of board and care facilities across Southern California. Awad and Thomas paid kickbacks to marketers, owners and administrators of board and care facilities to gain access to the mentally ill residents. Awad ordered respiratory treatment for the residents regardless of whether they had respiratory conditions. Respiratory therapists were paid to go out to the board and care facilities to perform daily or almost daily respiratory treatments on the residents. Thomas ordered the therapists to entice the residents to undergo the treatments with gifts, such as candy, donuts and even cigarettes.

These respiratory treatments took place without any doctor present, although Medicare requires that a doctor be present because of the potential danger of an adverse reaction to the treatment. Further, the respiratory treatments were falsely billed as being performed at Awad's office or in a mobile medical van because Medicare prohibited the treatments to be performed at board and care facilities.

Awad and Thomas submitted more than $7 million in claims to Medicare in connection with their scheme, including bills claiming that treatments had been performed on dates when residents were actually being treated for other ailments at hospitals. Awad and Thomas also submitted $500,000 in claims for services purportedly performed at a time when Awad was actually out of the country.

The investigation into Awad and Thomas began when the mother of a mentally ill Medicare beneficiary reviewed her son's Medicare statement and noticed that Medicare had been billed for more than 70 respiratory treatments at Awad's office, although her son did not have a respiratory condition and had no transportation to get to a doctor's office. She called Medicare's hotline number to complain. In its investigation, Medicare noticed the same type of daily or almost-daily billing of residents at many other board and care facilities.

After his conviction last year, Awad remained free on bond with electronic monitoring. He was incarcerated in June after he tampered with his electronic monitoring device.

Thomas is scheduled to be sentenced on November 13.

The case was investigated by the Federal Bureau of Investigation and the United States Postal Inspection Service.

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Release No. 06-126

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