Case 2

Olajumoke Lawal

HCM 388

"UNITED STATES OF AMERICA Plaintiff-Appellee v. MARIA AIDE DELGADO Defendant-Appellant"

12/2/13

I.                    Procedure

a.      Who are the parties?

·                     United States of America (Plaintiff)

·                     Sylvia Delgado (Defendant)

b.      Who brought the action?

·         United States of America, the plaintiff

c.       In what court did the case originate?

·         United States District Court for the Western District of Texas

d.      Who won at the trial-court level?

·         The Plaintiff

e.      What is the appellate history of the case?

·         Defendant was convicted by a jury of defrauding Medicaid and Medicare of $1.4 million. She appealed her conviction, arguing that the evidence was insufficient; prejudicial evidence was admitted; the jury instructions were flawed; her sentencing level was erroneously increased for obstruction of justice; and the United States District Court for the Western District of Texas erred by denying defendant's request for post-trial contact with a juror.

II.                  Facts

·                     Delgado, a self-professed medical billing expert with thirty years of experience in medical coding and billing

·                     Delgado  owned a billing company called Med Comp Electronic Billing

·                     In 1992, Delgado started doing billing and record work for Dr. Rafael Solis, a psychiatrist.

·                     In 2002, Delgado was approached by a Licensed Master Social Worker (“LMSW”) named Robert Rael (“Rael”) with a business idea of providing group psychotherapy counseling to the elderly.

·                     Rael's idea consisted of having a psychiatrist refer patients to Rael for group psychotherapy sessions. Delgado agreed to approach Dr. Solis with the idea, and the three formed Synergy in early 2002.

·                     Dr. Solis, as a licensed psychiatrist, was the medical director of Synergy.

·                     Dr. Solis referred the patients to Synergy for group psychotherapy, which was billed under his Medicaid and Medicare numbers even though he did not conduct or supervise the group sessions.

·                     Rael agreed to conduct the group therapy sessions using Dr. Solis's billing numbers because Rael was not authorized under Texas law to have his own billing numbers.

·                     Delgado performed all of the billing and split Synergy's Medicaid and Medicare billing proceeds with Rael.

·                     Rael received seventy percent of the proceeds and paid for operating expenses.

·                     Delgado received thirty percent of the proceeds. Dr. Solis was initially not paid by Synergy, but starting in January 2005, Synergy paid him $2,000 per month.

·                     Medicare and Medicaid paid $1.4 million for therapy conducted at Synergy from 2002 until 2005.

·                     In just over three years, Rael profited $508,953.10 and Delgado profited $388,059.20 from Medicaid and Medicare.

·                     The "therapy" conducted at Synergy was ineligible for the Medicaid and Medicare payments that Rael and Delgado received.

·                     Delgado, through research and talking to other billing practitioners, learned how to circumvent this system using a modifier in conjunction with the billing code.

·                     After discovering this modifier, Delgado billed up to six group therapy sessions per day per patient.

·                     Medicare's program integrity contractor flagged Dr. Solis because his office billed the group therapy code 17,000 times in one year compared to his peer group's average of 500 claims.

·                     Rael, as a LMSW, is unqualified to conduct therapy sessions in Texas without supervision, and there is evidence that Delgado was told that Rael was not authorized to conduct these therapy sessions.

·                     Dr. Solis admitted to investigators that he did not supervise the therapy at Synergy.

·                     Rael was not even conducting most of the therapy but instead   spent seventy-five percent of the "therapy" time alone in his office.

·                     Robert Martinez, who has a sixth grade education, conducted most of the sessions.

·                     Martinez picked up the patients around 12:30 p.m. on weekdays and brought them to Synergy, where they would sign an attendance log, watch television, talk to each other, and eat doughnuts for the first hour.

·                     Delgado billed Medicaid and Medicare up to six group psychotherapy sessions per day per patient.

·                     What Synergy did is billable to the programs, if at all, as adult day care, which is reimbursed at a much lower rate and for no more than two units per day.

·                     Synergy did not even qualify for adult day care, however because it failed to furnish nursing staff, personal care services, and physical therapy services.

      b.   Are there any facts that you would like to know but that are not revealed in the opinion?

·                     What did they mean by paid informant?

·                     Why didn’t Dr. Solis doing anything to change the billing process?

III.                Issues

a.      What are the precise issues being litigated, as stated by the court?

·                     Fraud and Making False Statements

·                     Conspiracy

b.      Do you agree with the way the court has framed those issues?

·         Yes

IV.               Holding

a.      What is the court’s precise holding (decision)?

·         Based on the investigation, a grand jury returned a ten-count indictment against Delgado.  A jury found Delgado guilty on all counts. She was sentenced to 51 months in prison and ordered to pay $1,411,203.08 in restitution. Delgado's prison sentence included a two-step increase for obstruction of justice because of Delgado's improper contact with a juror.

b.      What is its rationale for that decision?

·                     Although defendant argued the evidence was insufficient to establish she knew the therapy she was billing for was fraudulent so she could not have had the requisite means to commit fraud or make false statements, the appellate court disagreed. Because of her ownership and involvement in the business and her schedule-keeping for a psychiatrist, defendant knew the psychiatrist could not be conducting or personally supervising the therapy.

·                     Do you agree with that rationale?

Yes

V.                 Implications

a.      What does the case mean for healthcare today?

·         Healthcare providers need to be aware of what is going on in their facilities. they need to understand that a simple "I wasn't aware"  is not enough when there is fraud being done.  

b.      What were its implications when the decision was announced?

·         Delgado was sentenced to 51 months in prison and ordered to pay $1,411,203.08 in restitution

c.       How should healthcare administrators prepare to deal with these implications?

·                     make sure there is a person to do audits within the company, making sure that there is no fraud, whether knowingly or unknowingly

·                     Stricter guidelines should be implemented

·                     Annual evaluations should take place more than once a year, preferably quarterly.

.

d.      What would be different today if the case had been decided differently?

·                     Similar cases would occur more often if people were to see cases such as this get a simple smack on the wrist as punishment.

·                     Issues with billing managers would continue to be a problem.

 I agreed with the court’s decision to affirm the prior court's decision. In my eyes the billing manager knew what was going on and only wanted to benefit financially.  Delgado's greed lead to prison time in which was deserved.

References

http://caselaw.findlaw.com/us-5th-circuit/1552821.html