Owner of Drug Treatment Centers Charged with Medicaid Fraud and Illegal Kickbacks

Within an industry created specifically to help those suffering from opiate addiction, the owner of multiple Massachusetts-based drug treatment clinics has been charged with six counts of Medicaid fraud and an illegal kickback scheme involving eight sober houses. Massachusetts Attorney General Martha Coakley announced that Dr. Punyamurtula Kishore allegedly defrauded the state’s public health insurance program, MassHealth, of over $3.8 million.

Dr. Punyamurtula Kishore, the founder of Preventive Medicine Associates, owned and operated 29 treatment facilities throughout the state of Massachusetts. Each clinic specialized in opiate addiction treatment using a medication called Vivitrol. Traditionally treated with methadone or Suboxone therapy, Dr. Kishore claimed that Vivitrol was a non-addictive alternative for patients suffering from opiate addiction.

He was arrested at his home and charged with eight counts of Medicaid fraud and 12 counts of larceny. Dr. Kishore was also charged with eight counts of illegal kickbacks to housing programs, known as sober homes, for recovering addicts.

According to Coakley, Dr. Kishore bribed the owners and employees of eight sober houses to send urine samples to his offices for screening. Each of the drug screens were later reimbursed by Medicaid, netting Dr. Kishore $3.8 million in fraudulent payments.

“That scheme … involved billing MassHealth for drug and urine screens, often at the amount of $100 to $200 each, for screens that were either unnecessary or never completed,” said Coakley.

Dr. Kishore was also accused of placing sober house administrators on Preventive Medicine Associates’ payroll in an attempt to conceal the fact he was paying them illegal kickbacks in exchange for drug screening work to his labs. In some instances, the good doctor even tried to cover up the illegal kickbacks by placing sober home employees on the payroll of his charity, the National Library of Addictions.

According to Assistant Attorney General Nancy Maroney, the sober home administrators and employees were fraudulently placed on Dr. Kishore’s payrolls and, in reality, did little to no work for Preventive Medicine Associates or the National Library of Addictions.

In addition to the payroll scheme, Dr. Kishore allegedly attempted to cover up the illegal kickbacks by disguising the payments as fees for rental space within the sober homes. He created bogus leases with the sober homes, claiming that Preventive Medicine Associates was renting small areas within each home to collect urine samples and evaluate patients.

According to official documents, between July 2006 and May 2011, Dr. Kishore filed over 53,000 Medicare reimbursement claims for 864 patients within the eight sober homes.

A vast majority of Preventive Medicine Associates clinics closed after the lawsuit was filed against Dr. Kishore. Those clinics which had remained open immediately closed after Dr. Kishore’s arrest, providing no warning to patients or employees. In fact, many employees claimed they had not been paid by Dr. Kishore in several weeks.

Additional indictments were handed down for Dr. Kishore’s co-conspirators in connection with the illegal kickback scheme. These included:

  • John Coughlin, president of Gianna’s House, Inc.: Gianna’s House operates multiple sober homes located in Wareham, New Bedford and Sandwich, Massachusetts. Coughlin is charged with one count of receiving illegal Medicaid kickbacks.
  • Carl Smith, president of New Horizons House, Inc.: New Horizons House has three sober homes located in Quincy, one in Randolph and three in Dorchester, Massachusetts. Although it is not clear how many of the New Horizon facilities were directly involved with the illegal kickback scheme, Smith is charged with one count of receiving illegal Medicaid kickbacks.

Dr. Kishore was held on a $150,000 bond following his arrest. He was released on his own personal recognizance one day later after surrendering his passport and agreeing to wear a GPS tracking device.

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By | 2018-09-14T14:43:08+00:00 May 6th, 2013|Healthcare Fraud|