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Medicaid provider accused of fraud

Allegedly billed for dead patients

State Attorney General Martha Coakley announced Medicaid fraud indictments yesterday. State Attorney General Martha Coakley announced Medicaid fraud indictments yesterday. (David L. Ryan/Globe Staff)
By Patricia Wen and Brian Ballou
Globe Staff / October 1, 2011

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FRAMINGHAM - A nonprofit agency that promoted itself as a compassionate organization devoted to helping disabled, indigent adults stay in their homes was accused by state prosecutors yesterday of running a cynical scam, billing the state for about 20 patients who had been dead for some time.

Prosecutors also said Adlife Healthcare - run by Sharon Richardson at locations in Framingham, Dorchester, Hyannis, and West Springfield - charged Medicaid for home health aid services rendered to more than 100 infirm patients even though its staff had not done the work.

These billing practices, as well as three other unrelated Medicaid fraud schemes in the state, siphoned a total of $10 million from MassHealth, the state’s Medicaid program providing health insurance for the poor, Attorney General Martha Coakley said yesterday in announcing the grand jury’s indictment of 10 individuals.

Her office released names of nine of the indicted defendants but declined to name the 10th, saying it had been sealed by the courts. No reason was given.

A lawyer for Adlife’s owner defended her as a hard-working victim of paperwork misunderstandings and outsized charges. But Coakley described the operation, and the three others, as theft of taxpayer dollars that hurts everyone in the state.

“It means your health care costs go up; it’s like shoplifting in stores,’’ she said at a news conference outside her Boston office.

Others indicted yesterday included Dr. Punyamurtula Kishore, 61, a Brookline drug-addiction specialist who had been arrested nine days ago on an initial charge, though the full scope of the grand jury case against him was not made clear until yesterday. His arrest was put on an accelerated schedule by prosecutors because they feared he was about to flee the country, perhaps to his native India.

Yesterday, Kishore was charged with building a urine-screening business by bribing at least four operators of sober houses, facilities for recovering substance abusers, to send referrals his way. The intricate kickback scheme involving his company, Preventive Medicine Associates, produced $3.8 million in fraudulent Medicaid billing by using bribery as a means to get business, the state alleges.

His lawyer, who had defended him at his Sept. 21 hearing as a “well-regarded member of the community,’’ did not return phone calls yesterday. Kishore is free on personal recognizance, under the condition that he wear a GPS tracking device and turn over his passport.

Indicted for allegedly receiving kickbacks from Kishore were Carl Smith, 65, of Dorchester, manager of New Horizon House; John Coughlin, 31, of Carver, president of Gianna’s House facilities in Wareham, New Bedford, and Sandwich; and Thomas Leonard, 56, of Malden, manager of Marshall House in Malden.

At the Sept. 21 arraignment, Damion P. Smith, president of Fresh Start Recovery Coalition, based in Malden, was identified as receiving bribes from Kishore at a rate of roughly $2,500 a month. The attorney general’s office declined to say whether Damion Smith is the 10th defendant indicted by the grand jury.

The two other alleged schemes involve providers who inflated the services they gave patients, largely to secure higher Medicaid reimbursements.

The state charged David M. Benson, 48, a licensed independent clinical social worker who ran Mitchell Counseling Services in New Bedford, with defrauding the state of more than $160,000 through improper billing for at least a half-dozen patients.

Carolyn Wetterberg, 70, of Weymouth, was indicted for allegedly billing MassHealth for more than $600,000 in acute-level services not provided in her now-defunct nursing home, known as Pond View Nursing Facility in Jamaica Plain. The state alleged that she and her staff exaggerated the disabilities of patients in the 43-bed nursing home in order to get the inflated reimbursements.

Most of the defendants are expected to be summoned for arraignment in the next several weeks, though two of them, Carl Smith and Richardson, were formally charged yesterday, and both pleaded not guilty.

At Richardson’s arraignment yesterday in Framingham, handled by prosecutor Joshua Orr, the state alleged that she overbilled by $5.5 million. Defense lawyer Daniel Small of Boston, however, said prosecutors are exploiting small accounting and paperwork issues involving his client that do not reflect her good work.

He said her alleged billing for dead people simply reflected a lag time between when her agency learned of a client’s death in their home, and adjustment to the company’s Medicaid paperwork reflecting that fact.

“Is it supposed to be a shock that some of her clients pass away?’’ he said in court. “I don’t think so, because many of those people are elderly. We’re talking about 20 people out of 1,700.’’

The state said that Richardson had been charged in the mid-1980s with fraud associated with securing public assistance, as well as assault and battery, though her lawyer said she is a honorable woman who “built this company from scratch.’’

Indicted along with Richardson, 55, of Framingham, were two of her employees, Lisa Richardson-Miles, 36, of Framingham, and Kali Geddes, 31, a social worker, the attorney general’s office said.

Coakley said the prosecutions also add money back to the public coffers: They recovered more than $66 million last year.

Andrew Bagley, director of research and public affairs for the Massachusetts Taxpayers Foundation, said even though the alleged Medicaid fraud announced yesterday is a tiny fraction of the state’s $10.4 billion MassHealth budget, these high-profile prosecutions help keep in check the thousands of MassHealth providers.

“You have a certain very small percentage who game the system,’’ he said.

Patricia Wen can be reached at wen@globe.com.

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