No. 18-31078
United States Court of Appeals
February 24, 2021
United States of America,
Plaintiff—Appellee,
versus
Jonathon Nora,
Defendant—Appellant.
Appeal from the United States District Court for the Eastern District of Louisiana; USDC No. 2:15-CR-61-8
Before Higginbotham, Jones, and Higginson, Circuit Judges.
Stephen A. Higginson, Circuit Judge
A jury convicted Appellant Jonathon Nora of three crimes: conspiracy to commit health care fraud, in violation of 18 U.S.C. § 1349 (Count 1); conspiracy to pay or receive illegal health care kickbacks, in violation of 18 U.S.C. § 371 and 42 U.S.C. § 1320a-7b(b)(2) (Count 2); and aiding and abetting health care fraud, in violation of 18 U.S.C. §§ 1347 and 2 (Count 27). Nora challenges his convictions as based on insufficient evidence.
We REVERSE his convictions and VACATE his sentence.
I. Background
While Nora is the sole appellant in this case, he was not alone at trial. Nora was tried and convicted alongside five codefendants for his involvement in a large home health care fraud and kickback scheme in connection with his employment at Abide Home Health Care Services, Inc.
His codefendants— Dr. Shelton Barnes, Dr. Michael Jones, Dr. Henry Evans, Dr. Gregory Molden, and Paula Jones—also appealed their convictions, but their case was resolved by a separate panel of this court in United States v. Barnes, 979 F.3d 283 (5th Cir. 2020).
That panel affirmed the codefendants’ convictions. Id. at 292. (Chief Judge Priscilla Owen authored the opinion for the panel which included Judges Catharina Haynes and Gregg Costa).
In doing so, it also described the nature of the fraud and kickback schemes run out of Abide, the facts of which are also relevant to Nora’s appeal. Id. at 292-94. We thus borrow Barnes’s description of the overall schemes before turning our focus to Nora’s specific role at Abide.
As described in Barnes:
Dr. Shelton Barnes, Dr. Michael Jones, Dr. Henry Evans, Paula Jones, and Dr. Gregory Molden were each previously employed by Abide Home Care Services, Inc., a home health agency owned by Lisa Crinel. Barnes, Michael Jones, Evans, and Molden served as “house doctors.” In that role, the physicians referred patients to Abide for home health care services. Paula Jones, Michael Jones’s wife, was one of Abide’s billers. As a biller, Jones would process Medicare filings. She would use the Kinnser billing system (Kinnser) to ensure that all appropriate documentation existed for each bill. As part of Abide’s business model, it would “provide home health services to qualified patients and then bill Medicare accordingly.”
Medicare reimburses providers for home health care services if a particular patient is (1) eligible for Medicare and (2) meets certain requirements. Those requirements include, inter alia, that the patient is “‘homebound,’ under a certifying doctor’s care, and in need of skilled services.” Certifying a patient for home health care begins with an initial referral, which typically originates with the patient’s primary care physician.
Next, “a nurse goes to the patient’s home to assess if [he or] she is homebound, completing an Outcome and Assessment Information Set [ (OASIS) ].” From the OASIS assessment, the nurse develops a plan of care on a form known as a “485” for the prescribing physician’s review. Only a physician can approve a 485 plan. Physicians are expected to review the forms to ensure they are accurate.
These forms, as well as a face-to-face addendum certifying that the nurse met with the patient, are then routed to Medicare. This process permits payment for one 60-day episode. Patients can then be recertified for subsequent episodes.
Medicare determines how much will be paid for each episode based, in part, on the patient’s diagnosis. Each diagnosis has a corresponding code derived from the International Statistical Classification of Diseases and Related Health Problems 9th Revision (an ICD-9 code).
Reimbursements are higher for some diagnoses than others. So-called “case-mix diagnoses” such as rheumatoid arthritis, cerebral lipidosis, and low vision, receive higher payments than other, comparatively simpler diagnoses. As a result, false or erroneous entries on the OASIS form can ultimately result in higher Medicare reimbursements.
The government came to suspect that Abide was committing health care fraud. Specifically, the government alleged that “Abide billed Medicare based on plans of care that doctors authorized for medically unnecessary home health services.”
According to the government, several patients who had received home health care from Abide did not, in fact, need such services. Each physician had “approved [case-mix] diagnoses to patients on . . . 485s that were medically unsupported.” Paula Jones had also participated in the scheme. Through Kinnser, Abide employees were able to predict how much Medicare would reimburse for a particular episode of home health care. If the episode did not meet Abide’s “break-even point,” Jones would send “the files back to the case managers to see if they could get the score up.” These and other actions “fraudulently inflated Medicare’s reimbursement to Abide.”
Relatedly, the government also came to suspect that Abide was “pay[ing] doctors, directly or indirectly, for referring patients.” The government alleged that Crinel (the owner of Abide) had paid the physicians for patient referrals. Some of these payments were “disguised as compensation for services performed as [medical directors]” for Abide.
The government also alleged that Paula Jones’s salary, which had doubled during her time working for Abide, was based on her husband’s referrals. This conduct, the government alleged, constituted a violation of 42 U.S.C. §§ 1320a-7b(b)(1), (b)(2)—the anti-kickback statute. Barnes, 979 F.3d at 292-93 (quoting United States v. Ganji, 880 F.3d 760, 764, 777 (5th Cir. 2018)).
In addition to Nora and his codefendants at trial, the Government alleged that many others participated in the fraud. In total, the Government indicted 23 individuals. Several pleaded guilty instead of going to trial, including Crinel—the head of Abide and chief orchestrator of the fraud. As part of her plea bargain, Crinel agreed to cooperate with the Government and to testify at trial against Nora and his codefendants. The trial lasted 21 days and included evidence relating to Nora’s role at Abide and his purported involvement in the fraud and kickback schemes.
Nora began working at Abide on October 6, 2009, when Crinel hired him to be a full-time data entry clerk earning $13 an hour. At the time, Nora was 22 years old and had a high school degree along with some college credits.
On September 27, 2012, he was promoted to the position of office manager and began earning an annual salary of $60,000. Nora continued to work at Abide through March 25, 2014, the date the Government executed a number of search warrants on Abide.
Notably, Nora remained salaried throughout his employment at Abide and the Government points to no evidence that he received other compensation.
In this role, Nora coordinated new patient intake and admissions. To begin the processing of a new patient, Nora would field calls from referrers of potential new patients. Nora would then collect that patient’s Medicare or other insurance information to verify her benefits covered Abide’s services. He would then assign a nurse to conduct an evaluation of the patient’s eligibility for home health care. If the nurse approved the patient for care, Nora would then assign a field nurse to make the regular home health visits. Nora also helped with the data entry of forms generated during this process, such as the OASIS forms and 485s completed by reviewing nurses and case managers.
Abide received patient referrals from a variety of sources, including from its own house doctors and other employees, as well as outside doctors and other non-employees. Abide also engaged in various marketing practices to identify potential patients, such as by sending recruiters to local health fairs.
Nora was among those assigned to follow up with potential patients identified by recruiters. Nora would call these potential patients, reintroduce Abide, and ask about their interest in home health care. If the potential patient was interested and had her own doctor, Nora would contact that doctor to see if the doctor approved of home health services for the patient. If the doctor did approve, the doctor would send a referral form to Nora, who would in turn submit it to Abide’s reviewing nurses.
If the potential patient did not have her own doctor, Nora would offer the patient the services of one of Abide’s house doctors, who could review the patient’s suitability for home health care. In addition, when a potential patient had her own doctor, but the doctor did not think home health care was appropriate for that patient, Nora would follow up with the patient to inform her of her doctor’s recommendation. Nora would also tell these patients that they might still be eligible for home health care, but that they would need to be evaluated by a different doctor.
If the patient remained interested in Abide’s services notwithstanding her own doctor’s recommendation, Nora would offer to assign the patient to one of Abide’s house doctors for a separate evaluation of her eligibility.
Beyond the admissions process, Nora was responsible for scheduling home nursing visits for the patients and processing the visit notes. He also helped track patient recertifications.
The evidence at trial showed that Nora’s role entangled him, to some extent, in three practices that were central to Abide’s fraud and kickback schemes.
The first was Abide’s use of house doctors. As the court in Barnes described (in the excerpt above), Abide would rely on its house doctors to approve medically unnecessary plans of care so that it could bill Medicare for patients who would otherwise not qualify for home health services. By virtue of his role in assigning prospective patients to these house doctors, the Government contended that Nora was complicit in this practice.
The second was Abide’s pay-for-referral system. As just discussed, Abide relied on referrals to acquire new patients. And when a referral successfully resulted in a new patient, Abide would pay the person who made the referral. The Government contended at trial that these referral payments were illegal “kickbacks” in violation of 42 U.S.C. § 1320a-7b(b).
There was abundant evidence at trial showing that Nora was involved in processing these payments and that he knew they were for patient referrals. Nora helped maintain a log of referrals and would inform the referrers that their referred patient had been admitted and that they could thus receive compensation in return. Nora was also sometimes instructed to deliver referral payment checks to those who had made successful referrals.
The third practice at Abide in which Nora was involved was known as “ghosting.” As described above by the court in Barnes, when a patient satisfies Medicare’s requirements for home health services, Medicare will approve payment for one 60-day episode of care. Should the patient need additional care beyond that episode, they can be recertified for additional 60- day episodes. However, as Crinel explained at trial, home health is intended to be a temporary benefit and it raises a “red flag” to Medicare if a patient is re-certified for too many episodes in a row.
To avoid suspicion, Crinel instituted a system whereby patients would be “ghosted.” Here’s how ghosting worked: once a patient had been in Abide’s system for “a couple of years,” Abide would officially discharge the patient but informally hold onto them, with the assigned nurses continuing to make home visits.
From the patient’s perspective, nothing had changed and thus the patient had no incentive to leave Abide and seek home health services elsewhere.
But from Medicare’s perspective, this patient was no longer receiving services from Abide. While a patient was being ghosted, Abide would not bill that patient or charge Medicare. When Abide’s nurses would visit a ghosted patient, instead of entering the visit data into Abide’s electronic record system as was done for formal visits, the nurses submitted a paper note to record the visit.
After 60 days, the ghosted patient would be re-enrolled as an official patient and Abide would resume billing Medicare.
In contrast to Nora’s involvement in the pay-for-referral scheme, it is not clear what Nora’s responsibilities were with respect to ghosting. Crinel maintained a list of patients who needed to be ghosted and would send that list to Gaynell Leal, a case manager at Abide, and to Nora. It is not clear what Nora would do once he received that list, but the evidence suggests he was at least aware of what was happening (in the sense that he knew patients were being discharged but still treated by Abide’s nurses1) and helped make scheduling changes to facilitate the practice.
For example, Leal testified that after receiving the list from Crinel, she wrote up a note describing that a certain patient should be discharged and then brought back at a later date. She gave that note to Nora so that he could, in his capacity as a scheduler, inform the patient’s assigned nurse that the patient had been discharged but that the nurse should continue making visits and turning in paper notes recording the visit data. Leal also testified that “[e]veryone in the office” knew about ghosting.
Beyond Nora’s general involvement in Abide’s practices, the Government also introduced evidence related to one of Abide’s patients named “EvLa.” Nora’s purported involvement with EvLa’s experience at Abide formed the basis of his conviction for aiding and abetting health care fraud (Count 27).
EvLa was a patient at a group home that referred its patients to Abide for home health services. The owner of the group home, Verinese Sutton, testified that—as a general matter—when she wanted to refer a patient to Abide she would sometimes call Nora to make the referral.
After receiving the referral, Nora would send a nurse from Abide to assess the patient and would then refer the patient to Dr. Michael Jones, one of Abide’s house doctors. Sutton also described that when she went to Abide to pick up her referral payments, Nora would usually be the one to hand her the checks.
1 As will be discussed below, it is a separate question whether Nora was aware of the unlawful purpose behind ghosting.
Separately, Sutton also testified that EvLa was one of her group home patients who received home health care services from Abide. EvLa was under the care of Dr. Jones. Other evidence was introduced at trial that showed that EvLa was not actually homebound and that she was thus ineligible for home health care.
Aside from the evidence describing Nora’s general involvement in sometimes fielding Sutton’s referrals to Abide and his handling of Sutton’s payments, there is no specific evidence about whether he was involved with EvLa’s experience at Abide or with her treatment by Dr. Jones.
At the conclusion of the Government’s case-in-chief, Nora moved for a judgment of acquittal pursuant to Federal Rule of Criminal Procedure 29, which the district court denied without particularizing evidence of Nora’s knowledge of the unlawfulness of Abide’s practices. Just as he had not made any opening argument, Nora did not call any defense witnesses.
The jury then returned its verdict convicting Nora on all three counts. Following the verdict, Nora renewed his motion for judgment of acquittal, and in the alternative, moved for a new trial. The district court denied the motion, again without pointing to particularized evidence of Nora’s knowledge of the unlawfulness of Abide’s practices.
The district court sentenced Nora to a concurrent sentence of 40 months’ imprisonment on each count, followed by one year of supervised release.
This was a downward variance from the Guidelines range because the court found that “the loss calculation overstated [Nora’s] participation.”
The court also ordered Nora to pay restitution to Medicare in the amount of $12,921,797.
Nora filed a timely notice of appeal.
II. Legal Standard
As he argued to the district court in his Rule 29 motions, Nora asserts here that his convictions are not supported by sufficient evidence.
Where, as here, a defendant has timely moved for a judgment of acquittal, this court reviews challenges to the sufficiency of the evidence de novo. Though de novo, this review is nevertheless highly deferential to the verdict.
Because of the shortcomings inherent in examining a cold appellate record without the benefit of the dramatic insights gained from watching the trial, we review the evidence and all reasonable inferences in the light most favorable to the prosecution and to determine whether any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt. United States v. Nicholson, 961 F.3d 328, 338 (5th Cir. 2020) (internal quotation marks and citations omitted).
III. Discussion
There is no dispute that Nora worked at Abide while fraud and kickback schemes occurred, but what is in dispute is whether Nora knew that his work was unlawful. Or, legally, whether there was sufficient evidence introduced at trial for a rational juror to conclude beyond a reasonable doubt that Nora acted “willfully” to defraud Medicare or to pay illegal health care kickbacks.
18 U.S.C. § 1347(a)(1) makes it a crime to “knowingly and willfully . . . defraud any health care benefit program.” 18 U.S.C. § 1349 extends that liability to those who conspire to defraud a health care benefit program.
42 U.S.C. § 1320a-7b(b)(2), the anti-kickback statute, makes it a crime to “knowingly and willfully offer[] or pay[] any remuneration (including any kickback, bribe, or rebate)” to induce someone to refer an individual to a health care provider for which payment may be made under a federal health care program.
“As a general matter, when used in the criminal context, a ‘willful’ act is one undertaken with a ‘bad purpose.’ In other words, in order to establish a ‘willful’ violation of a statute, ‘the Government must prove that the defendant acted with knowledge that his conduct was unlawful.’” Bryan v. United States, 524 U.S. 184, 191-92 (1998) (quoting Ratzlaf v. United States, 510 U.S. 135, 137 (1994)).2
2 The Court in Bryan also described the general definition of “knowingly” when used in the criminal context. Bryan, 524 U.S. at 193 (“[U]nless the text of the statute dictates a different result, the term ‘knowingly’ merely requires proof of knowledge of the facts that constitute the offense.”).
Although the precise meaning of the term “willfully” can vary depending on the context, id. at 191, this court has held that the general understanding of the term applies to its use in the general health care fraud statute and the health care anti-kickback statute. See, e.g., United States v. Ricard, 922 F.3d 639, 648 (5th Cir. 2019) (“Willfulness in the Medicare kickback statute means that the act was committed voluntarily and purposely with the specific intent to do something the law forbids; that is to say, with bad purpose either to disobey or disregard the law.” (internal quotation marks and citation omitted)); United States v. St. John, 625 F. App’x 661, 666 (5th Cir. 2015) (per curiam) (accepting the district court’s § 1347 willfulness instruction, which stated that “willfully . . . means that the act was committed voluntarily or purposely, with the specific intent to do something the law forbids; that is to say, with bad purpose either to disobey or disregard the law” (alteration in original)); see also United States v. Willett, 751 F.3d 335, 339 (5th Cir. 2014) (holding that § 1347 requires “specific intent to defraud”).3
3 Importantly, with this general definition of willfulness, for a defendant to act with knowledge that his conduct is unlawful does not require him to have awareness of the specific law he is charged with violating.
Congress has made clear that such a heightened showing is not required to convict a defendant of committing health care fraud or paying illegal health care kick-backs; both statutes were amended in 2010 to specify that “a person need not have actual knowledge of this section or specific intent to commit a violation of this section.” 18 U.S.C. § 1347(b); 42 U.S.C. § 1320a-7b(h); see also John, 625 F. App’x at 666. See generally Robb DeGraw, Defining “Willful” Remuneration, 14 J. L. & Health 271 (2000) (discussing various interpretations of “willful” in the context of the anti-kickback statute and in criminal law more broadly).
Neither conspiracy nor aider and abettor liability lowers this mens rea requirement. Conspiracy “has two intent elements—intent to further the unlawful purpose and the level of intent required for proving the underlying substantive offense.” United States v. Brooks, 681 F.3d 678, 699 (5th Cir. 2012); see also Willett, 751 F.3d at 339 (“To prove a conspiracy to commit health-care fraud in violation of 18 U.S.C. § 1349, the government must prove . . . that the defendant joined in the agreement willfully, that is, with intent to further the unlawful purpose.” (internal quotation marks and citation omitted)). And aider and abettor liability under 18 U.S.C. § 2 “results from the existence of a community of unlawful intent between the aider or abettor and the principal.” United States v. Sanders, 952 F.3d 263, 277 (5th Cir. 2020). In other words, an aider and abettor must share the same level of intent as the principal. United States v. Williams, 985 F.2d 749, 755 (5th Cir. 1993).
Nora argued throughout his trial and now to us that he “did not have the intent, knowledge, nor awareness of an illegal health care fraud scheme or illegal health care kickbacks at Abide required to convict him ”
For example, he argues that while he may have understood that Abide was making referral payments for new patients, there was no evidence at trial that proved that he knew these payments constituted unlawful kickbacks. He argues the same is true with respect to his role in the various practices that constituted Abide’s fraud on Medicare and with respect to Abide’s treatment of EvLa.
We agree.
While the Government presented evidence at trial detailing Nora’s role at Abide and his work responsibilities, the evidence did not prove that Nora understood Abide’s various practices and schemes to be fraudulent or unlawful, and thus there was insufficient evidence to conclude that Nora acted with “bad purpose” in carrying out his responsibilities at Abide. Furthermore, the evidence the Government points to as suggestive of Nora’s understanding of the unlawful nature of his work at Abide fails upon close inspection.
For example, the Government argues that Nora “received training on compliance, Medicare, and home health,” with the implication being that this training alerted him to the unlawful nature of Abide’s practices. But the evidence cited in support of this assertion comprises two pieces of paper of limited probative value.
The first is a one-page certificate that states that Nora “has successfully completed” the “2013 Palmetto GBA Home Health Workshop Series” sponsored by the “HomeCare Association of Louisiana” which is described as an “approved provider of continuing nursing education.” The certificate states that the workshop lasted for four hours. Through the testimony of an investigating agent, the Government only further elicited that this was a “home-health-specific training” and that Palmetto GBA was a Medicare contractor. There is no evidence about what this training entailed or if it discussed health care laws or Medicare regulations at all, let alone regulations about kickbacks or activity relating to “ghosting.”
The second piece of evidence is an Abide form signed by Nora on October 29, 2009, that states that Nora “participated with the compliance program” and has “been briefed on compliance.” It also states that Nora has “been made aware that if [Nora] know[s] of any fraudulent behavior and/or abuse of any kind, [he] is to report this behavior to the CEO and/or DON/Administrator as soon as possible.” Again, there is no description of what this compliance program entailed.
In addition, the Government cites the fact that Nora would attend reg- ular staff meetings at Abide, where among other things, “any changes to Medicare regulations” were discussed. There is no further evidence about what regulations were discussed at these meetings.
This evidence is insufficient. A juror would have to make a speculative leap about the content of these trainings and meetings—that they somehow alerted Nora to the unlawfulness of Abide’s practices and the actions he took to support them. A rational juror would need more to conclude that Nora acted “willfully.”
Of course, formal trainings were not the only route for Nora to learn about health care regulations or the impropriety of Abide’s practices. He could have learned directly from his colleagues. Indeed, Nora worked with individuals at Abide who clearly understood that Abide was engaging in wide- spread unlawful and fraudulent activity. Gaynell Leal, for example, testified that she knew that Abide engaged in “ghosting” in order to avoid “draw[ing] a red flag to Medicare.” And Crinel, of course, knew that Nora’s work helped Abide elude health care regulations.
Both Leal and Crinel testified for the Government to explain Abide’s schemes. Yet neither person (nor anyone else, for that matter) testified that Nora understood the unlawful or fraudulent purpose behind Abide’s practices. Neither testified that she had had a conversation with Nora about
avoiding red flags, or the illicitness of referral payments, or that the house doctors unlawfully approved medically unnecessary plans of care.
Leal testified that “[e]veryone in the office” knew about ghosting. But Leal goes no further than that. We do not know whether everyone in the office knew just that Abide engaged in that practice, or whether everyone in the office knew that the practice was employed to evade Medicare regulations.
Arguably, the “ghosting” practice is inherently suspicious. But even if a reasonable person in Nora’s shoes should have known (or at least suspected) that ghosting was unlawful, that would only make Nora guilty of negligently participating in a fraud—it does not prove that Nora acted “willfully” in facilitating ghosting and the fraud it furthered. See United States v. Crow, 504 F. App’x 285, 287 (5th Cir. 2012) (per curiam) (describing that negligence could not give rise to liability for health care fraud where the statute required the defendant act “knowingly and willfully”).
Similarly, Crinel testified that there was a “culture” at Abide “that [Abide] needed to hold on to [its] patients so [it] [could] make payroll” and that medical necessity did not matter. She also described that she once threatened to fire Leal and Nora when they had discharged a patient. Crinel’s testimony isn’t worthless—if an organization has a pervasive culture of disregard for the rules, that can lend credence to the case that an individual member of that organization is aware of wrongdoing.
This type of “everybody knew” testimony can thus bolster a case that an individual acted willfully. But here, it just isn’t enough.
These two general statements about a business operating in a health care industry subject to a complex system of laws and regulations cannot impute “bad purpose” to all 150 employees who worked there.
Comparing the evidence presented against Nora in this case to the evidence presented in a similar case against a similarly situated defendant
further reveals what is lacking here. In United States v. Murthil, the defend- ant, Joe Ann Murthil, was the office manager at Memorial, a home health care provider. 679 F. App’x 343, 347 (5th Cir. 2017) (per curiam). Memorial was run by Mark Morad, who used it to orchestrate a broad health care fraud and kickback scheme similar to the one run by Crinel out of Abide. See id. at 346-47. And like Crinel here, Morad was the Government’s key witness at trial. Id. at 346. For her role in Morad’s schemes, Murthil was convicted of conspiracy to commit health care fraud, conspiracy to pay health care kick- backs, and substantive health care fraud—an identical slate of convictions to Nora’s. Id.
On appeal, Murthil argued that there was insufficient evidence to conclude that she acted with the requisite level of intent. Id. at 348-49. She argued that she was a “‘pawn’ that the other conspirators took advantage of ‘because she did her job without asking questions.’” Id.
In affirming Murthil’s convictions, this court explained that:
The Government presented testimony that Murthil, the office manager at Memorial, had two decades of experience in the home healthcare field and that, in her role as the person in charge of billing, Murthil understood the healthcare regulations.
Among other evidence, Morad testified that Murthil knew her patients came from recruiters, not from doctor’s referrals, that Murthil understood that clients were not home- bound, and that it was Murthil’s responsibility to keep track of and reassign non-homebound patients away from nurses who were unwilling to risk their licenses by treating non-home-bound patients to nurses who were willing to treat and recertify such patients.
Based on the totality of this evidence in the ex- tensive record, we conclude that a rational trier of fact could have found that Murthil was knowingly complicit in Morad’s scheme to defraud Medicare.
. . .
As to Murthil’s knowledge that the checks she gave to patient recruiters were illegal kickbacks under 18 U.S.C. § 371, among other evidence, Morad testified that he had conversa- tions with Murthil regarding the impropriety of selling Medicare numbers and about paying kickbacks to recruiters. He also testified that a recruiter was allowed to give patient information only to Murthil, “the only person that [he] trusted” because he “did not want anyone else in the office to know that [he] was paying kickbacks to [a recruiter] or that’s how [they] were get- ting [their] patients.” Id. at 349.
Thus, in Murthil, the Government had presented evidence that (1) Murthil had 20 years of experience in the home health care field and understood Medicare regulations due to her role handling billing, (2) she knew patients were not homebound and reassigned those patients to nurses who were willing to risk their licenses, (3) she had had conversations with Morad about the impropriety of paying kickbacks to recruiters, and (4) she was the only one trusted by Morad—the chief facilitator of the fraud.
Nora, by contrast, joined Abide at age 22 with a high school degree. He did not handle billing.
The Government identifies no evidence that he knew that any of Abide’s patients were not actually homebound, or that he knew he was assigning patients to nurses or doctors who were willing to run afoul of regulations and risk their licenses. Crinel, cooperating with the Government, never testified that she had any conversations with Nora about the impropriety of Abide’s practices, nor that Nora served as a co-conspirator.4
4 Indeed, after its oral argument before this panel, the Government appropriately notified the court that it had made an overstatement during oral argument, when it asserted that Crinel had testified specifically that Nora knew about the fraud. She had not done so.
That the Government had the cooperation of the chief orchestrator of Abide’s fraud but nevertheless failed to elicit testimony directly establishing the knowing complicity of Nora is especially telling.
Perhaps recognizing the absence of specific evidence demonstrating Nora’s knowledge of the unlawfulness of Abide’s practices, the Government argues that because Nora worked for five years at Abide and his role put him near many of its fraudulent or illegal practices, “it is difficult to believe that he was oblivious to what was happening at Abide or his role in it.”
In support, it cites decisions of this court for the purported principle that “proximity” to fraudulent activities alone can support an inference of knowledge of unlawfulness.
It is true that this court has held that “proximity to the fraudulent activities” can lead to an inference of knowledge of fraud. See, e.g., Willett, 751 F.3d at 340; see also United States v. Thompson, 761 F. App’x 283, 291 (5th Cir. 2019) (per curiam) (finding the defendant’s “repeated exposure to the fraud” to be probative of his knowledge). But in those cases, the defendants’ “proximity” to fraud was probative because it directly exposed them to dishonest and fraudulent behavior.
For example, in Willett, the question was whether the defendant knew about the fraudulent “upcoding” of equipment bills sent to Medicare. 751 F.3d at 340. There, the Government introduced evidence that the defendant, after delivering equipment to hospitals and receiving confirmatory delivery tickets in return, would then be present (i.e., in “proximity”) while his co-conspirator (who was also his wife of 35 years) “ripped off or doctored codes on the delivery tickets,” or wrote in codes where there were no existing codes. Id.
Moreover, in these cases, there was other evidence separate from “proximity” that proved the defendants’ knowledge of the fraud.5
5 For example, in Willett, a witness also testified that she had overheard the defendant and his wife having a suspicious conversation that suggested they were engaging in wrongdoing and collaborating together. 751 F.3d at 340.
In Thompson, there was evidence that the defendant—a medical marketer—would drive “fully ambulatory” patients to the doctor and watch them “get in and out of her non-wheelchair accessible car,” all before referring those same patients to the doctor as needing the use of powered wheelchairs. 761 F. App’x at 291.
In United States v. Martinez, in addition to citing the defendants’ proximity to the fraud, this court also pointed to the existence of direct video evidence showing the defendants had engaged in fraudulent medical procedures and submitted false claims. 921 F.3d 452, 469, 471 (5th Cir. 2019).
Moreover, there was testimony that the non-doctor defendant in Martinez would make patient referral payments by placing the cash behind a bathroom medicine cabinet, for the recipient to collect. Id. at 467.
In upholding her conviction, the court pointed to this deceptive practice as evidence that she knew of the illegality of the payments. Id.
Here, as already described, other evidence of Nora’s knowledge is lacking. And the Government’s argument about Nora’s “proximity” to the fraud taking place at Abide is devoid of specifics—it does not identify evidence showing that Nora directly observed, or deliberately closed his eyes to, fraudulent behavior such that a rational juror could infer that he knew about Abide’s fraud.
Therefore, Nora’s “proximity” to Abide’s fraudulent practices does not supply sufficient evidence to convict him.
In sum, even under our extremely deferential review of jury verdicts, there was insufficient evidence put forth at trial for a rational juror to conclude beyond a reasonable doubt that Nora acted with the knowledge that his conduct was unlawful.
The Government thus failed to prove that Nora acted “willfully” with respect to each count.
Specifically, there was insufficient ev- idence proving (1) that Nora knew that Abide was defrauding Medicare, through “ghosting,” its use of house doctors, or otherwise (Count 1); (2) that Nora knew that Abide’s referral payments constituted illegal kickbacks (Count 2); or (3) that Nora had involvement with EvLa’s treatment at Abide (let alone that he knew she was not actually homebound) (Count 27).
IV. Conclusion
For the foregoing reasons, we REVERSE Nora’s convictions for conspiracy to commit health care fraud (Count 1), conspiracy to pay illegal health care kickbacks (Count 2), and aiding and abetting health care fraud (Count 27). We therefore also VACATE his sentence.
Twitter? Hell No. Third Cir. Judge Attacks Fifth Cir. Judges on Behalf of Sr. Judge Patrick Higginbotham
CA3 Appellate Judge Stephanos Bibas clerked for CA5 Senior Judge Patrick Higginbotham, who’s weary of the younger judges opinion-writing style
Attorney Kalu Diogu Files New Lawsuit While Bankruptcy Continues in another Courtroom
On reviewing the lengthy list of defendants, LITs definitely interested in the complaint re Sandy Dasigenis and Foreclosure Network of Texas.
Pro Se Randall Rollins Allowed to Amend his Federal Complaint Four Times in SDTX, Houston Div’n
Judge Eskridge: Rollins has filed four complaints in federal court. Even so, he fails to state claims that can survive jurisdictional attack.
Owner Admits Guilt in Elaborate $30 Million Home Health Fraud
oct 7, 2015 | REPUBLISHED BY LIT: FEB 24, 2021
An elaborate $30 million Medicare fraud indictment has resulted in a Louisiana home health company owner and three former home health workers pleading guilty to health care fraud-related charges, the Justice Department announced. The case has grabbed media attention not only for the high dollar amount but for claims of racial bias and a scam related to the Deep Water Horizon oil spill.
Lisa Crinel, former owner and operator of Abide Home Care Services Inc., was indicted last March as part of a sweeping charge that involved 20 individuals.
As operator, Crinel was charged with Medicare fraud for allegedly hiring “house doctors” to sign home health orders for Medicare beneficiaries who did not need home care. The house doctors reportedly falsely signed home health orders—regardless of a beneficiary’s diagnoses, homebound status or needs—in return for monthly payments that were fraudulently characterized as medical consultant or director fees.
Following the indictment, Crinel, who is also the 2004 Zulu Queen, repeatedly attempted to have all evidence seized in a 2014 raid thrown out, alleging that federal authorities acted with racial bias when they seized the more than $1 million in property a year before she was indicted. She alleged that prosecutors seized the property in an effort to cripple her financially and would not have acted in the same way against a white defendant in a similar case. Crinel also said in a civil lawsuit that she had a romantic relationship with the husband of a federal judge who signed the search warrant for the FBI in the investigation in 2014, Louisiana news outlet WDSU News reported.
Crinel’s daughter, Wilneisha Harrison Jakes, who was serving as chief administrative officer for Abide, was also deeply involved with the scam and indicted. The company was also accused of hiring marketers to increase referrals, which are typically driven by health care professionals. Authorities allege that the company and defendants were involved in more than $30 million in Medicare fraud.
Crinel pled guilty to two counts of conspiracy to commit health care fraud and conspiracy to pay and receive illegal kickbacks. As a result, Crinel, 52, faces a maximum prison term of 10 years, a $250,000 fine and 3 years of supervised release following imprisonment. Her sentencing is scheduled for Jan. 13, 2016. She owes restitution in the amount of $16,088,222 jointly with several co-defendants.
Crinel and Abide were also accused of falsely applying for wage relief in the aftermath of the oil spill in the Gulf of Mexico caused by BP’s Deepwater Horizon oil rig. According to authorities, the home care company pocketed more than $37,000 in reimbursements from BP.
Threasa Adderley, 64, pled guilty to Count 2 of the Indictment for conspiracy to pay and receive illegal kickbacks. Adderley was a physician with Abide who acted as a medical consultant and received more than $48,000 of Medicare funds for medically unneccessary home health billing, court documents show.
Rhonda Maberry, 48, pled guilty to conspiracy to commit health care fraud. Mayberry worked as an Advanced Practice Registered Nurse with Abide and received payments totaling approximately $272,982.61 from Medicare between January 2006 and December 2012 for medically unnecessary home health.
Adderley and Maberry face a maximum term of 5 years imprisonment, a fine of $250,000, a supervised release term of up to 3 years and restitution.
Seila Mathieu, 46, pled guilty to aiding and abetting the theft of Government money of property and faces a maximum term of 1 year imprisonment, a fine of $100,000, a term of supervised release up to one year and restitution. Matheiu worked as a RN for Abide and received approximately $48,800 for performing false and fraudulent home health certifications that were largely medically unnecessary.
Twenty individuals were indicted conspiracy to commit health care fraud, conspiracy to defraud the United States and to receive and pay health care kickbacks, and the prosecutors warned that the case has not concluded for other individuals involved.
“Today’s guilty pleas are further evidence of our commitment to fighting health care fraud in our region,” U.S. Attorney Kenneth Polite said in a prepared statement. “Those engaged in similar criminality should take note: our investigation in this case, and other related matters, is on-going.”
FBI – October 2, 2015
Lisa Crinel, Abide Home Health, Inc., and Three Others Plead Guilty to Health Care Fraud-Related Charges
U.S. Attorney Kenneth A. Polite announced that LISA CRINEL, age 52; THREASA ADDERLEY, age 64; RHONDA MABERRY, age 48; SHEILA MATHIEU, age 46, all of New Orleans, and PCAH, INC.a/k/a PRIORITY CARE AT HOME, INC. d/b/a ABIDE HOME CARE SERVICES INC. pled guilty today to health care fraud-related charges.
LISA CRINEL pled guilty to Count 1 of the Indictment charging her with conspiracy to commit health care fraud and Count 2 of the Indictment charging her with conspiracy to pay and receive illegal kickbacks. CRINEL faces a maximum term of imprisonment of 10 years, a $250,000 fine, and three years of supervised release following imprisonment, as to Count 1 of the Indictment. As to Count 2, CRINEL faces a maximum term of five years’ imprisonment, a fine of $250,000, and a term of supervised release of up to three years. CRINEL owes restitution in the amount of $16,088,222 jointly and severally with her co-defendants. U.S. District Judge Susie Morgan set sentencing for January 13, 2016.
THREASA ADDERLEY pled guilty to Count 2 of the Indictment charging her with conspiracy to pay and receive illegal kickbacks. ADDERLEY faces a maximum term of five years’ imprisonment, a fine of $250,000, a term of supervised release of up to three years and owes any applicable restitution. ADDERLEY’s sentencing date is January 13, 2016.
RHONDA MABERRY pled guilty to a one-count Superseding Bill of Information filed on October 1, 2015, charging her with conspiracy to commit health care fraud. MABERRY faces a maximum term of five years’ imprisonment, a fine of $250,000, a term of supervised release of up to three years, and owes restitution in the amount of not less than $272,982.61, as to Count 1 of the Superseding Bill of Information filed against her. U.S. District Judge Susie Morgan set sentencing for January 27, 2016.
SHEILA MATHIEU pled guilty to a one-count Superseding Bill of Information filed on October 1, 2015, charging her with aiding and abetting the theft of Government money or property. MATHIEU faces a maximum term of one year imprisonment, a fine of $100,000, a term of supervised release of up to one year, and owes any applicable restitution, as to Count 1 of the Superseding Bill of Information. MATTIEU’s sentencing date is January 27, 2016.
PCAH, INC. a/k/a PRIORITY CARE AT HOME, INC. d/b/a ABIDE HOME CARE SERVICES INC. (“ABIDE”) pled guilty to Count 1 of the Indictment, charging the company with conspiracy to commit health care fraud. ABIDE faces a maximum fine of $500,000, as to Count 1 of the Indictment, and agreed that restitution in the amount of $16,088,222 is jointly and severally due by ABIDE and its co-defendants. Sentencing is scheduled for January 16, 2016.
“Today’s guilty pleas are further evidence of our commitment to fighting health care fraud in our region,” stated U.S. Attorney Polite. “Those engaged in similar criminality should take note: our investigation in this case, and other related matters, is on-going.”
According to Court documents, CRINEL was the owner and operator of ABIDE, a business that provided home health care services to homebound individuals who were primarily Medicare beneficiaries. As the owner and Chief Operating Officer of ABIDE, CRINEL took a “100 percent hands on approach” that extended to “almost every aspect of the operation” of the business.
Home health experts trained CRINEL and her staff on who qualified for home health and how home health services should be documented. Evidence seized at the search of ABIDE’s office established that CRINEL maintained ABIDE’s Medicare Provider Number and routinely certified on behalf of ABIDE that she would not knowingly present or cause to be presented false or fraudulent claims for payment by Medicare.
Nevertheless, CRINEL instructed her staff not to discharge patients, even those who did not require home health services. ABIDE, under CRINEL’s direction also routinely falsified diagnoses codes and medical records to cause inflated reimbursements from Medicare. CRINEL and ABIDE created an atmosphere where RNs and other health care professionals would compromise their medical and ethical judgment in order to defraud Medicare.
Court documents also show that CRINEL and ABIDE entered into sham employment contracts and medical director contracts with doctors and others to cover up the illegal kickback relationship betweenCRINEL, ABIDE, and those doctors and other individuals.
According to Court documents, ADDERLEY, was one of the physicians who entered into a sham contract with ABIDE to act as a medical consultant for the home health care agency. As such, she was required to submit monthly documentation detailing the services she provided to or on behalf of ABIDE.
The agreements called for ADDERLEY to meet with ABIDE supervisors, at least annually, and to measure and evaluate overall performance of ABIDE. Quarterly meetings were also to be held to evaluate and discuss the ongoing home health program.
ADDERLEY was also to perform in-services or educational programs to ABIDE and to review charts to determine if ABIDE was meeting expected outcomes. According to court documents, ADDERLEY didn’t give any in-service of any kind at ABIDE nor did she meet with ABIDE supervisors to measure and evaluate the performance of ABIDE personnel.
ADDERLEY routinely compromised her medical judgment by certifying ineligible Medicare beneficiaries for home health provided by ABIDE who did not meet requirements for services because the patients were neither homebound nor medically in need of the services.
Over the period covered by the Indictment, ABIDE paid ADDERLY more than $48,000 of Medicare funds for medically unnecessary home health billing.
According to Court documents, MABERRY worked as an Advanced Practice Registered Nurse who practiced under a collaborative agreement with a charged co-defendant/conspirator, DR. SHELTON BARNES.
DR. BARNES, like ADDERLY, operated under sham contracts with ABIDE to perform medical director services. MABERRY was required to collaborate with DR. BARNES to initiate appropriate referrals for home health care based on current standards of practice and keep appropriate patient files.
Both MABERRY and DR. BARNES were enrolled Medicare providers. Evidence establishes that ABIDE paid MABERRY for seeing patients that ABIDE sent MABERRY and that MABERRY approved every patient ABIDE referred to her for home health, whether or not medically necessary. Court documents also show that DR. BARNES signed the plans of care approving medically unnecessary home health services.
MABERRY knew that at least half of the patients she saw for ABIDE or DR. BARNES were not homebound and did not qualify for home health. MABERRY received payments totaling approximately $272,982.61 from Medicare from January 2006 until December 2012, for home visits and care plan oversight for beneficiaries referred to ABIDE and certified as medically necessary for home health by DR. BARNES.
The trial for DR. BARNES is presently scheduled for August 1, 2016, before U.S. District Judge Susie Morgan.
According to Court documents, MATHIEU worked as an RN for ABIDE, beginning in June 2012. Her duties included assessing the status of her patients, initiating a plan of care, evaluating patient needs, providing comprehensive nursing care, among other things.
Payroll records would demonstrate that between July 5, 2012, and March 18, 2014, ABIDE paid MATHIEU approximately $48,794.69 for performing false and fraudulent home health certifications for episodes of home health which were largely medically unnecessary.
U.S. Attorney Polite praised the work of the Federal Bureau of Investigation in investigating this matter. Assistant U.S. Attorneys Patrice Harris Sullivan, Sharan Lieberman and Andre Lagarde are in charge of the prosecution.
