July 2nd, 2008
Two Physical Therapy Companies in Memphis Cost MEDICARE $3.5 Million
Memphis, TN - A federal jury has returned guilty verdicts on 42 counts of money laundering against ROBERT LEE PRINCE, III of Dallas, Texas for promoting money laundering in a physical therapy scheme to bill Medicare for services that were not provided announced Lawrence J. Laurenzi, Acting United States Attorney for the Western District of Tennessee. In less than three years, the two Tennessee corporations operating in Memphis, Brittsen Rehabilitation Services, Inc. (Brittsen) and Tender Loving Rehabilitation, Inc. (TLR), were paid approximately $3,500,000 from the Medicare Trust Fund. Three co-defendants in the case, MARILYN PRINCE WATTS, M.D. of Memphis, MICHAEL PRINCE of Houston, Texas, and DARRYL DEMPSEY of Garland, Texas each entered a guilty plea to a conspiracy to defraud Medicare/CIGNA.
The proof at trial showed that the defendant, ROBERT LEE PRINCE, III, conspired with family members to launder Medicare money which had been obtained by submitting fraudulent claims for payment to CIGNA/Medicare for services that were not rendered. The scheme originated with MICHAEL ANTHONY PRINCE in Texas and was then moved to Louisiana, Illinois and Tennessee. ROBERT LEE PRINCE, III had several roles in the money laundering conspiracy including that of owner of TLR, investor, signatory on bank accounts, and bookkeeper. DARRYL DEMPSEY assisted with billing and marketing. DR. MARILYN PRINCE WATTS’ only involvement was with the Memphis operation where she recruited doctors, hired employees, faxed billing documents to Texas and signed and authorized checks.
The proof at trial showed that defendants sought to profit financially by producing records, including patient medical charts, treatment plans and claims for payment, to make it appear to CIGNA that Medicare beneficiaries had received physical therapy services under a physician’s supervision and in accordance with Medicare’s requirements. Upon receipt of the claims, CIGNA would process the apparently legitimate claims and pay Medicare monies into the corporate bank accounts designated by Brittsen and TLR. The Medicare payments were used to pay employees, maintain the billing scheme and make distributions among the defendants, their family members, and their related companies. In 2001, Brittsen received approximately $1.8 million from Medicare and then paid more than $1 million for “consulting” services.
Sentencing is set for Michael Anthony Prince on July 17, 2008; for Darryl Dempsey on August 29, 2008; for Marilyn Prince Watts on September 2, 2008; and for Robert Lee Prince, III on September 19, 2008. All sentences will be imposed by the Honorable Jon Phipps McCalla, Chief Judge of the U.S. District Courts in the Western District of Tennessee.
This case was investigated by agents on the Health Care Fraud Task Force from the Department of Health and Human Services-Office of the Inspector General; the Internal Revenue Service - Criminal Investigation; the Tennessee Bureau of Investigation-Medicaid Fraud Control Unit; and the Health Care Fraud Investigator for the U.S. Attorney’s Office. This case was prosecuted by Assistant United States Attorneys Kevin P. Whitmore and Cam Towers Jones.
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