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July 3, 2015 Healthcare Fraud

Houston Hospital Leaders Sentenced to 45 Years in Prison for Alarming Medicare Fraud Scheme

The Riverside General Hospital first opened its doors in the 1960s amid a torrent racial climate, becoming one of the first hospitals to de-segregate and operate on policies of inclusion and equality. Since then, it has faced untold financial struggles, including a recent indictment stemming from allegations of nine-figure financial fraud, abuse of the Medicare/Medicaid systems, and deviations from standard patient care.

In 2014, three leaders of Riverside General Hospital – the former president, his son, and a third co-conspirator – were indicted on charges ranging from conspiracy to commit Medicare fraud to money laundering. In October of that year, a five-week trial ensued and the men were convicted on counts including conspiracy to commit healthcare fraud, conspiracy to pay and receive kickbacks, and several kickback/unlawful financial incentives charges.

Just this week, the three men received their punishments, which include penalties to address nearly $158 million in overbilling, as well as untold harm to patients admitted to the facilities. The former president, 70-year old Ernest Gibson, was sentenced to 45 years behind bars, while his son and co-conspirator were sentenced to 20 years and 12 years, respectively.

Details of the fraud allegations against Riverside General Hospital executives

The bulk of the Medicare and Medicaid fraud allegations against Gibson, et al. center around Riverside’s psychiatric facilities, which are classified by the government as a “partial hospitalization program” (PHP).[1. Department of Justice Press Release, “Former President of Riverside General Hospital Sentenced to 45 Years in Prison in $158 Million Medicare Fraud.” June 9, 2015. Scheme] A PHP is technically an outpatient treatment facility, but is geared toward the round-the-clock care required for patients enduring a severe mental illness. Under government guidelines, mental health patients receiving care at a PHP must be routinely seen by a psychiatrist, guided through a care plan, and carefully monitored throughout the course of treatment.

According to the allegations, Riverside collected more than $158 million in funds from Medicare and Medicaid on behalf of PHP patients who rarely, if ever, saw a psychiatrist for their illnesses. Moreover, Riverside regularly billed the government for psychiatric services that were never rendered, mostly because the patients were in the advanced stages of dementia and unable to participate in the treatment.

Patient care aside, Riverside is also accused of offering kickbacks and financial incentives to executives group homes, as well as recruiters tasked with increasing referrals of mental health patients to Riverside’s facilities.

In addition to the three main participants listed above, six other individuals recently pled guilty to conspiring with Gibson to bring in the maximum number of Medicare and Medicaid clientele.

According to a statement by the U.S. Attorney General’s Office, “The former President of Houston’s Riverside hospital, his son, and their co-conspirators saw mentally ill, elderly, and disabled Medicare beneficiaries as commodities to be turned into profit centers – not as vulnerable individuals in need of health care….Rather than providing needed medical care to a historically underserved community, the defendants ran a longstanding hospital into the ground through their greed and fraud. According to the evidence presented at trial, the defendants had patients sit around the facility watching movies while they received no treatment. Meanwhile, the defendants billed Medicare more than $158 million for care that was never provided. This brazen fraud cannot and will not be tolerated.”

Contact a healthcare fraud whistleblower attorney today

If you are aware of healthcare fraud similar to that described above, please do not hesitate to contact a reputable and confidential whistleblower attorney at Berger Montague today.