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To celebrate the opening of Rivkin Radler’s first Florida office, we’ll cover some recent Florida frauds. The U.S. Department of Justice (DOJ) announced on April 20 that two Miami residents, Dean Zusmer and Lawrence Alexander, were sentenced to prison for their roles in a Medicare fraud scheme. Zusmer, a chiropractor, and Alexander, an orthopedic surgeon, fraudulently billed Medicare over $31 million for medically unnecessary durable medical equipment (DME), for which Medicare paid over $15 million. A co-conspirator, Jeremy Waxman, obtained patient referrals by paying kickbacks to marketers who used overseas call centers to solicit patients for unnecessary braces, and was previously sentenced to more than 15 years in jail. Zusmer and Alexander received sentences of eight years and almost three years, respectively.

Another Florida resident, Nagaindra Srivastav of Tampa, was recently sentenced to nine years in prison and ordered to pay over $48 million in restitution after his conviction of conspiracy to pay and receive kickbacks and solicitation and receipt of kickbacks. Srivastav and his co-conspirators created an online platform, B2B Apps Solutions, for buying and selling fraudulent doctors’ orders for DME, including ankle, back, knee, and leg braces. Srivastav also set up a website, RepsHub, on which DME companies and others uploaded information on patients for whom DME products could be fraudulently billed.

Finally (for now), on April 11, DOJ announced one of its first prosecutions under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). Charles William McElwee of Palm Beach County was sentenced to 41 months in jail for conspiracy to violate MACRA by buying and selling Medicare Beneficiary Identifiers (MBIs) of over 2.6 million Medicare recipients.

Under MACRA, Social Security numbers were removed from Medicare cards to help prevent fraud and identity theft, and were replaced by MBIs. MACRA also made it illegal to buy, sell, or distribute MBIs without lawful authority. Unlike Social Security numbers, MBIs cannot be used for identity theft, but they can be used for medical identity theft. McElwee admitted that he and his co-conspirators used data mining and social engineering techniques to obtain MBIs and other personal information that was later advertised and sold online.

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