COLUMBUS, Ohio – Cheryl McGrath, 50, of Guysville, Ohio, was sentenced today in U.S. District Court to 36 months in prison for committing health care fraud and willful failure to pay over tax.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Ryan L. Korner, Special Agent in Charge, Internal Revenue Service (IRS) Criminal Investigation, Lamont Pugh III, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Office and Ohio Attorney General Mike DeWine announced the sentence handed down by Chief U.S. District Judge Edmund A. Sargus, Jr.
According to court documents, McGrath owned and operated Home Health Care of Southeast Ohio in Guysville, Ohio since 1993.
From 2009 until 2015, McGrath executed a scheme to defraud the Ohio Medicaid Program by billing on behalf of Home Health Care of Southeast Ohio for home health nursing services that were never rendered. The defendant routinely changed the claim information in the billing software to falsely reflect that additional hours of nursing services had been provided and falsely increased the number of nursing visits from one visit per week to between three and five visits per week.
McGrath also submitted claims for nursing services of Medicaid patients who were ineligible because they were either residing in private nursing homes or deceased.
In total, her scheme included fraudulent claims in the amount of approximately $2.2 million.
From 2009 until 2013, McGrath maintained the books and records regarding payroll for the home health care business. During that time, she submitted Forms 941 to the IRS but did not pay over the federal employment taxes that were due, causing a loss of $366,825 to the IRS.
McGrath pleaded guilty to health care and tax fraud charges in June 2017. As part of her plea agreement, McGrath has agreed to pay more than $2.2 million in restitution to the Ohio Medicaid Program and the nearly $367,000 to the IRS.
“As the person who controlled the finances on behalf of Home Health Care of Southeast Ohio, Cheryl McGrath was entrusted with the significant responsibility to collect and turn over all IRS withholding taxes” said Ryan L. Korner, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “By failing to do so, not only was the revenue due to the United States government affected, but more importantly, the Medicare and Social Security benefits of the employees was affected.”
“This scheme was intentional and egregious, and we worked hard to pursue a just outcome,” said Ohio Attorney General Mike DeWine. “Fighting health care fraud is a priority of my office.”
U.S. Attorney Glassman commended the investigation of this case by the IRS Criminal Investigation, U.S. Department of Health and Human Services OIG, FBI and the Ohio Attorney General’s Office Medicaid Fraud Control Unit, as well as Assistant United States Attorneys Jessica W. Knight and Kenneth F. Affeldt and Special Assistant United States Attorney Maritsa Flaherty with Ohio Attorney General Mike DeWine’s Office, who are representing the United States in this case.
# # #