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Thursday, October 27, 2005

RALEIGH - United States Attorney Frank D. Whitney announced that a jury in New Bern, N.C. has convicted CONVALESCENT TRANSPORTS, INC. and its president, BRIAN CONNER, of 343 counts of health care fraud, one count of conspiracy to commit health care fraud, and two counts of obstruction of a health care investigation. The jury returned its verdict on October 25, 2005.

The evidence presented at trial showed that between 1999 and 2002, Convalescent Transports, Inc., at the direction of Conner, routinely made fraudulent claims that patients it transported to routine dialysis treatments required ambulance transportation because they were “bed-confined,” meaning that they were unable to get up from bed without assistance, unable to walk, and unable to sit either in a chair or a wheelchair. In fact, the evidence showed, the patients involved in the case were routinely documented by health care workers and observed by Convalescent Transports employees to be able to do some or all of these things. The evidence showed that the patients in question were active in their communities, routinely able to engage in everyday activities such as attending church, visiting family, grocery shopping, eating at restaurants, and in one case driving a private vehicle. Expert testimony further established that there was no other medical need for these patients to be transported by ambulance to routine, non-emergency dialysis treatments.

Testimony from current and former employees of the company established that the conspiracy to further this scheme dates back to at least 1997, when, after learning of an imminent audit of the company’s billing practices, Conner directed numerous employees to rewrite and falsify ambulance records to eliminate references to any patient’s ability to walk or sit. Evidence demonstrated that employees were also routinely instructed by Conner from at least 1997 onward to omit such information from ambulance records because they were told that including the information would cause Medicare and Medicaid not to pay for the ambulance trips. Finally, the evidence showed that Conner and Convalescent Transports sought to obstruct the investigation into their conduct by attempting to prevent records relevant to two separate subpoenas from the United States from being produced.

Chief U.S. District Judge Louise W. Flanagan has scheduled sentencing for the February term of court. For each of the felony fraud counts, Conner could receive a maximum sentence of 10 years imprisonment. The conspiracy count and each of the obstruction counts are punishable by up to 5 years imprisonment.

Investigation of the case was conducted by Special Agent David Lange with the Office of Inspector General of the Department of Health and Human Services, as well as Agent Gary Coley of the Medicaid Fraud Unit of the North Carolina Attorney General’s Office. Assistant U.S. Attorneys Yvonne Watford-McKinney and Jay Exum prosecuted the case for the United States.


News releases are available on the U. S. Attorney’s web page at within 48 hours of release.

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