Opinion ID: 2779689
Heading Depth: 2
Heading Rank: 1

Heading: Health Care Fraud Scheme

Text: Five defendants, Antonio Macli, Jorge Macli, Huarte, Biscayne Milieu, and Dr. Kushner, all challenge the sufficiency of the evidence underlying their convictions for conspiracy to commit health care fraud under 18 U.S.C. § 1347, in violation of 18 U.S.C. § 1349 (count 1), and substantive health care fraud in violation of 18 U.S.C. §1347 (counts 2-8 and 11-12).6 Section 1347(a) provides a criminal penalty for anyone who: “knowingly and willfully executes, or attempts to execute, a scheme or artifice (1) to defraud any health care benefit program; or (2) to obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any health care benefit program, in connection with the delivery of or payment for health care benefits, items or services.” 18 U.S.C. § 1347 (emphasis added).7 Section 1349 provides a criminal penalty for anyone who “attempts or conspires to commit any offense under this chapter,” 6 Defendant Alalu’s brief did not challenge the sufficiency of the evidence to support his conviction under counts 1, 3, and 4. But to the extent defendant Alalu arguably tried to do so, see footnote 5, supra, we conclude ample evidence supported his convictions. 7 Further, in United States v. Medina, this Court concluded that: “Thus, the government has not shown that [defendants] made any false or fraudulent representations to Medicare, nor did they present evidence that [defendants] defrauded or attempted to defraud any health care program. 485 F.3d 1291, 1300 (11th Cir. 2007). “[P]aying kickbacks alone is not sufficient to establish health care fraud” under § 1347(a)(2). Id. at 1298. Rather, to sustain a § 1347(a)(2) conviction, there must be evidence of a false or fraudulent representation to Medicare, and “the defendant must be shown to have known that the claims submitted were, in fact, false.” Id. at 1297; see United States v. Vernon, 723 F.3d 1234, 1273 (11th Cir. 2013). 25 Case: 12-16056 Date Filed: 02/17/2015 Page: 26 of 85 which includes offenses under § 1347. 18 U.S.C. § 1349. Thus, § 1349 makes it unlawful to attempt or conspire to commit a § 1347 crime of health care fraud. To sustain the conspiracy conviction under 18 U.S.C. §1349, the government must prove that (1) a conspiracy existed; (2) the defendant knew of it; and (3) the defendant knowingly and voluntarily joined it. United States v. Vernon, 723 F.3d 1234, 1273 (11th Cir. 2013). Because the crime of conspiracy is “predominantly mental in composition,” the government may prove these elements by circumstantial evidence. Id.; United States v. Mateos, 623 F.3d 1350, 1362 (11th Cir. 2010) (affirming Medicare fraud convictions based on circumstantial evidence of knowledge). The nature of conspiracy requires proof by such inferences and circumstantial evidence. See Vernon, 723 F.3d at 1273; Mateos, 623 F.3d at 1362. “[T]he government need not prove that the defendant knew all of the details or participated in every aspect of the conspiracy.” Vernon, 723 F.3d at 1273; see also Mateos, 623 F.3d at 1363. Instead, the government’s burden is only to prove that the defendant knew of “the essential nature of the conspiracy.” Vernon, 723 F.3d at 1273. A conspiracy conviction will be upheld “when the circumstances surrounding a person’s presence at the scene of conspiratorial activity are so obvious that knowledge of its character can fairly be attributed to him.” Id.; Mateos, 623 F.3d at 1362. “As for the voluntary joining element, the government 26 Case: 12-16056 Date Filed: 02/17/2015 Page: 27 of 85 can meet this burden ‘through proof of surrounding circumstances such as acts committed by the defendant which furthered the purpose of the conspiracy.’” Vernon, 723 F.3d at 1274 (citation omitted). Here, the jury was properly instructed as to all of the elements of the §§ 1347 and 1349 crimes. In particular, and in contrast to the purely individual focus of the appellants’ briefs, the jury was instructed that for these substantive crimes, where a defendant is a member of a conspiracy, he or she is criminally liable for his or her co-conspirator’s reasonably foreseeable crimes committed during the course of and in furtherance of the conspiracy. Pinkerton v. United States, 328 U.S. 640, 645-48, 66 S. Ct. 1180, 1183-84 (1946); United States v. Silvestri, 409 F.3d 1311, 1335 (11th Cir. 2005). As recounted in detail above and summarized here, the government clearly introduced sufficient evidence to uphold each conviction as to each of these five appellants. As to defendant Antonio Macli, ample evidence demonstrated his control of the Biscayne Milieu business. Multiple witnesses testified that Antonio Macli was ultimately in charge. Though he often delegated tasks which implemented the fraud scheme, this delegation was entirely consistent with his managerial control. Defendant Antonio Macli had access to the “money sheets” throughout the course of the conspiracy, and he directed the format of the false employee filing for “case 27 Case: 12-16056 Date Filed: 02/17/2015 Page: 28 of 85 management” services. After hearing seven weeks of trial evidence, the district court found at sentencing that Antonio Macli “had intimate knowledge of everything, including the amount that was going to be paid” by Medicare. As to defendant Jorge Macli, his day-to-day management of Biscayne Milieu played a key role in the conspiracy. He acted as the contact person for Medicare, hired recruiters to find and refer patients, approved of the recruiting of Haitian patients, and pioneered the recruitment of substance-addicted patients from out of state. As to defendant Huarte, her significant role was made clear by her active involvement in the Medicare billing process. She maintained the personnel records on the recruiters and implemented the controls regarding therapy notes. 8 At sentencing, the district court found that defendant Huarte was not “similarly situated” to other defendants in the case who ultimately received lower sentences, additionally stating that Huarte’s actions “created problems for patients by not giving them the help they deserved, and [ ] ruin[ing] the lives of a number of legitimate therapists.” As to defendant Dr. Kushner, his centrality to the scheme is easily stated. He referred and steered patients treated at local hospitals to Biscayne Milieu even though the patients were not eligible for PHP treatment. Through his dual 8 Sufficiency of the evidence as to Biscayne Milieu is shown by the sufficiency of evidence to convict the Maclis and Huarte. 28 Case: 12-16056 Date Filed: 02/17/2015 Page: 29 of 85 positions at local hospitals and Biscayne Milieu, he was able to control patients going back and forth between Biscayne Milieu and the hospitals. Many of these same patients were repeatedly recycled through Biscayne Milieu after the PHP treatment failed to treat their underlying condition, most often active substance abuse. And as the district court found, the evidence showed Dr. Kushner did improper initial psychiatric evaluations, offered insufficient individualized treatment, and falsely certified that the Medicare rules had been followed. Given the evidence recounted above and earlier in this opinion, we readily conclude the government presented overwhelming evidence for a reasonable jury to convict these five appellants of the conspiracy to commit health care fraud and the substantive health care fraud counts.