Healthcare Employees Sentenced to Prison for Multimillion Dollar Adult Daycare Fraud Scheme
By the Constantine Cannon Whistleblower Team
A Texas physician and a clinic employee have been sentenced to prison for their roles in a multimillion dollar healthcare fraud and kickback scheme involving unnecessary lab tests and prescriptions.
Dr. Osama Nahas, owner and physician at Crosspoint Medical Clinic, and medical assistant Isabel Pruneda were convicted on March 1, 2024 by a federal jury of conspiracy to commit healthcare fraud, healthcare fraud, and conspiracy to violate the Anti-Kickback Statute after the two-week trial. In addition, Pruneda was convicted for aggravated identity theft.[1]
The Alleged Healthcare Fraud Scheme
According to the evidence presented at trial, Nahas visited adult daycare centers around the Rio Grande Valley area and ordered medically unnecessary lab tests and prescriptions for vulnerable elderly and disabled clients. Pruneda helped carry out the scheme by forging patient signatures on consent forms.
Pruneda also misappropriated expensive prescription medications and pain creams and distributed them as “goodie bags” to adult daycare clients to persuade patients to agree to unnecessary testing.
Between January 2016 and December 2017, Nahas and Pruneda ordered unnecessary prescriptions and lab work that resulted in millions of dollars in losses to Medicare. They directed those prescriptions and tests to specific laboratories and pharmacies in exchange for kickbacks.[2]
Kickbacks and Stolen Medications
During this timeframe, evidence showed that Nahas and Pruneda received tens of thousands of dollars in kickbacks.
In June 2018, law enforcement executed a search warrant at Crosspoint, seizing hundreds of thousands of dollars’ worth of stolen medications. Nahas and Pruneda also paid bribes that they attempted to conceal as “rent” payments to adult daycare owners to access their facilities. Witnesses testified that they received kickbacks for referrals, which were falsely characterized as “rent” agreements.
Chief U.S. District Judge Randy Crane sentenced Nahas to 120 months in prison. Pruneda received 97 months. Both are required to serve three years of supervised release after completing their sentences and were also ordered to pay over $3.1 million in restitution to Medicare.[3]
The Hearing
During the hearing, the court described Nahas and Pruneda as “predators” who took advantage of elderly, disabled, and other vulnerable patients at adult daycare centers.
U.S. Attorney Nicholas J. Ganjei stated, “Medical professionals have a solemn obligation to heal the sick and infirm, not to subject them to unnecessary treatments solely for the sake of making a quick buck. The defendants here abused their unique position of trust and shamelessly took advantage of particularly vulnerable victims. Now they will have several years in prison to reflect on their actions.”[4]
How Can Whistleblowers Report Healthcare and Pharmaceutical Fraud?
Healthcare and pharmaceutical fraud remains widespread and costly to government healthcare programs. While it is not known whether a whistleblower was involved in reporting this adult daycare fraud scheme, the government often counts on individuals to come forward with any information about fraud.
Whistleblowers may report healthcare fraud by bringing a case under the qui tam provisions of the False Claims Act. Under this statute, private parties can file lawsuits on behalf of the government, and if successful, whistleblowers can receive a portion of the government’s recovery as a financial reward. Read our post on how whistleblower rewards work to learn more.
Our Firm Helps Whistleblowers
According to Constantine Cannon attorney Ginger Buck, “This case is a reminder that healthcare fraud puts vulnerable patients at risk. By speaking up and reporting fraud, whistleblowers can help protect patients and preserve the integrity of government healthcare programs.”
Our firm has significant experience representing whistleblowers. If you believe you have a case or have questions about what it means to be a whistleblower under the various government programs, please contact us. We will connect you with an experienced member of our whistleblower team for a free and confidential consultation.
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Sources:
[1] See https://www.justice.gov/usao-sdtx/pr/prison-time-healthcare-employees-multimillion-dollar-adult-daycare-fraud-scheme.
[2] Id.
[3] Id.
[4] Id.
Tagged in: False Claims Act, Healthcare Fraud, Medicare, qui tam,