DEPARTMENT OF JUSTICE

Acting United States Attorney Edward R. Ryan
Western District of North Carolina

FOR IMMEDIATE RELEASE
Thursday, April 23, 2009

CONTACT: Terry Wilkinson
704.344.6222
Fax: 704.227.0264

OWNERS OF ALLEGHANY COUNTY, NC HERITAGE HOME CARE, INC. CHARGED WITH CONSPIRACY TO COMMIT HEALTH CARE FRAUD AND HEALTH CARE FRAUD Acting U.S. Attorney Edward R. Ryan announced today the arrest and initial appearance in federal court of Kristie Brake, 38, of Jonesville, NC and Kimberly Miles, 32, of Sparta, NC. Brake and Miles, co-owners of Heritage Home Care, Inc. in Sparta (Alleghany County,) NC, have been charged by a federal grand jury with one count of conspiring to commit healthcare fraud and 16 separate counts alleging healthcare fraud. Ryan is joined in making today’s announcement by N.C. Attorney General Roy Cooper of the NC Department of Justice.

According to the indictment, Brake and Miles were co-owners of Heritage from April 2003 until January 2007. During this time, Heritage employees provided Personal Care Services (“PCS”) to Medicaid recipients in and around Alleghany County. PCS enable the elderly, people with disabilities, and other individuals with chronic or temporary conditions to remain in their homes by having aides assist them with daily activities (e.g., bathing, dressing, meal preparation, and grocery shopping).

The indictment alleges a healthcare fraud conspiracy beginning in April 2003 and continuing until January 2007. In addition, the indictment alleges that on 16 separate occasions from April 2004 through January 11, 2007, Brake and Miles submitted false and fraudulent claims for payment for PCS which were either not provided to Medicaid beneficiaries or which were not eligible for reimbursement under state and federal law. Allegations include that Brake and Miles submitted false and fraudulent claims for reimbursement for services purportedly rendered after a beneficiary had died and for another beneficiary who had moved several hundred miles away. The indictment alleges that Brake and Miles altered time tickets completed by aides employed at Heritage to support false and fraudulent claims for reimbursement which had already been submitted to Medicaid. In addition, the indictment alleges that the defendants forged a physician’s signature on a prescription form ostensibly authorizing reimbursable PCS for a recipient, and that they also submitted false and fraudulent claims for reimbursement for PCS which had actually been provided by an aide who was a member of the beneficiary’s immediate family, a practice prohibited by state and federal law. In total, according to the indictment, Brake and Miles submitted more than 15,000 false and fraudulent claims which defrauded the Medicaid program of more than $600,000.

Acting U.S. Attorney Ryan, of the Western District of North Carolina, said, “It is important for North Carolina citizens to know that the U. S. Department of Justice will do its part to protect both the vulnerable recipients of these services and the taxpayers of North Carolina from those individuals looking to line their own pockets rather than provide adequate and appropriate care to those who need it most.”

North Carolina Attorney General Roy Cooper commended the work of the NC Medicaid Investigations Unit, saying, “ Ripping off Medicaid hurts needy patients, wastes tax dollars, and runs up health costs for everyone. Our investigators and prosecutors are working hard to crack down on health care fraud so people will know that they can’t cheat Medicaid and get away with it.”

If convicted, the defendants face up to ten years in prison for the conspiracy count, and a prison term of up to ten years as to each individual healthcare fraud count. The indictment includes a Notice of Forfeiture and Finding of Probable Cause that the Defendants forfeit to the United States all of the property involved in the offenses with which they are charged in the indictment, and all property traceable to such offenses, including but not limited to the sum of approximately $624,218.

It is important to note that under U.S. Sentencing Guidelines, which are currently advisory but which must be taken into consideration by the sentencing court, an actual sentence is based upon a formula that takes into account the severity and characteristics of the offense, and each defendant’s criminal history, if any.

The allegations against the defendants in the federal bill of indictment arise from an ongoing healthcare fraud investigation conducted by the Medicaid Investigations Unit of the North Carolina Department of Justice.

In a criminal case, the law presumes defendants to be innocent, and the burden is on the government to prove every element of each offense beyond a reasonable doubt.

KRISTIE BRAKE
Age 38
Jonesville, North Carolina

KIMBERLY MILES
Age 32
Sparta, North Carolina