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FOR IMMEDIATE RELEASE
Monday, May 2, 2016

New Orleans Jury Convicts Company Owner for Directing $3 Million Fraud and Kickback Scheme

On Saturday, a jury in New Orleans convicted the owner of a health care company for her role in a $3.2 million Medicare fraud scheme operating in and around New Orleans. 

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth A. Polite of the Eastern District of Louisiana, Special Agent in Charge Jeffrey S. Sallet of the FBI’s New Orleans Division and Special Agent in Charge CJ Porter of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG)’s Dallas Regional Office made the announcement.

Tracy Richardson Brown, 46, of New Orleans, was convicted of 18 counts after a five-day trial before U.S. District Judge Stanwood R. Duval Jr. of the Eastern District of Louisiana.  Brown was convicted of one count of conspiracy to commit health care fraud, nine counts of health care fraud, one count of conspiracy to pay illegal kickbacks and seven counts of paying illegal kickbacks.  Brown’s sentencing hearing is scheduled for Aug. 10, 2016. 

Evidence introduced at trial showed that Brown owned and operated Psalms 23 DME LLC (Psalms) and caused Psalms to bill Medicare for durable medical equipment and orthotics that were not needed and/or were not provided.  Brown paid patient recruiters for the names and Medicare numbers of Medicare recipients in and around New Orleans and then used these Medicare numbers to bill Medicare, claiming that Psalms provided them power wheelchairs, accessories and orthotics.  Trial evidence showed that a vast majority of these patients did not need and often did not receive, or even want, the equipment.  Evidence also revealed that Brown engaged in “upcoding,” billing Medicare as if she provided these patients with high-cost back and knee braces, when she in fact provided them much cheaper versions of these braces.  Brown caused Psalms to bill Medicare for more than $3.2 million in claims, a large number of which were fraudulent.  Medicare paid Psalms approximately $1.9 million on these claims.

This case was 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 Louisiana.  This case was prosecuted by Assistant U.S. Attorney Patrice Sullivan of the Eastern District of Louisiana and Trial Attorney William Kanellis of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,300 defendants who have collectively billed the Medicare program for more than $7 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is 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

16-516
Topic: 
Healthcare Fraud
StopFraud
Updated August 10, 2016