$70m Alleged Healthcare Scam Busted in Texas

$70m Alleged Healthcare Scam Busted in Texas

Ten individuals were charged in a 13-count indictment related to a broad-scale alleged healthcare fraud scheme, according to a recent press release from the FBI.  65-year-old Jeffrey Parsons and 55-year-old David Edson, vice presidents of Continuum Healthcare LLC, were allegedly at the center of the fraud. 

Parsons and Edson, both Floridians, are accused of paying “kickbacks” to the following home owners and patient advocates, most of whom live in Houston, Texas: 61-year-old Aretha Johnson, 51-year-old Michelle Pace, 44-year-old James Bobino, 66-year-old Mary Browning, 68-year-old Cheryl Waller, 51-year-old Deborah Davis, 55-year-old Earnestine Johnson, and 53-year-old Ronald Turner. 

More specifically, Parsons and Edson are accused of billing Medicare and Medicaid $173 million for ineligible patients who were obtained as a result of the alleged scheme. According to the FBI release, about $70 million was paid to Continuum from the federal healthcare programs. 

Although the indictment is still partially sealed, the FBI claimed that it “alleges Edson and Parsons ran Continuum, which owned and operated three community mental health centers in the greater Houston Area. They allegedly billed Medicare and Medicaid for mental health services which were unnecessary and, in some cases, not even provided. According to the indictment, Edson and Parsons directed kickbacks to be paid to numerous area personal care home owners and patient advocates in exchange for the referral of Medicare patients to Continuum.”

All defendants are facing charges related to issuing or receiving improper payments from a federal program; however, Parsons, Edson, and Johnson reportedly received an additional charge for money laundering. 

The Houston Chronicle reported that Johnson allegedly received the most significant kickback, totaling $2.2 million, as a result of the fraud. 

The alleged fraud taking place at Continuum was largely revealed by 2011 reports from the Chronicle

“The Chronicle investigation found Westbury Community Hospital, formerly named Contiuum Healthcare, was a frequent stop for private EMS delivering patients from personal care homes,” reporter Jayme Fraser wrote. “Patients of clinics citywide who were interviewed by the paper often were able-bodied and did not understand why the specialized transport – which was billed to Medicare – was needed. Many remembered the food they ate and the videos they watched at the clinics, but could not recall therapy.”

In 2012, Continuum was raided by federal agents. Hundreds of documents were reportedly seized. 

The defendants all face time in a federal prison, as well as hefty fines. All but one were released from jail on bond, as they await their hearing. 

U.S. Rep. Kevin Brady, R-The Woodlands, said in a statement, “Medicare fraud steals from seniors and taxpayers. I keep fighting this drain on Medicare’s limited resources. Every dollar lost to this fraud is a dollar not spent providing care for our seniors.”

Earlier this year, Breitbart Texas reported on another healthcare fraud case in which the Medical Director of A Medical House Calls (A Medical), a Texas-based medical house call company for Medicare recipients, was sentenced to federal prison. According to a press release from the Texas Attorney General obtained by Breitbart Texas, A Medical billed taxpayers $1.4 million for services that were not needed or were never provided between May 2010 and January 2012. The fraudulent bills resulted in home health agencies charging an additional $9.7 million to the Medicare program. 

Follow Kristin Tate on Twitter @KristinBTate