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California and the West

Owner of Healthcare Firms Settles Charges

October 11, 2006|Molly Selvin | Times Staff Writer

A Los Angeles nurse who owned two of California's largest home healthcare companies agreed to pay $33.8 million to settle federal charges that she defrauded Medicare and filed false tax returns that concealed her proceeds, prosecutors announced Tuesday.

The settlement may be one of the largest involving home healthcare providers, said San Francisco attorney Michael Brown, who represented a whistle-blower in the case. It is the latest in a string of Medicare fraud cases in Southern California, which federal prosecutors call a hotbed of this activity.

Lourdes Perez, 53, pleaded guilty to the fraud charges in October 2004 as part of a deal to cooperate with federal prosecutors investigating the fraud.

Perez owned and operated Provident Home Health Care Services Inc. in Eagle Rock and Tri-Regional Home Health Care Inc. in San Dimas, which together billed Medicare about $80 million annually.

Brown said the case was unusual because of the "enormous scale of the fraud orchestrated by one person," noting that in just over 18 months, Perez grew her companies from start-ups to among the top home healthcare companies in California in terms of Medicare billings.

Last week a second nurse involved in the scheme, Margaret Tan, 29, of Santa Monica, agreed to plead guilty to fraud charges.

Although prosecutors say the investigation is continuing, documents in the probe were unsealed last week.

According to her plea, Perez billed Medicare for patients who were not homebound and for services her companies did not perform, creating false medical records to support the claims.

Perez's attorney, Kenneth Barish of Los Angeles, did not return calls seeking comment.

In the last year, prosecutors have recovered tens of millions of dollars from hospitals, nursing home operators and others accused of Medicare fraud.

"Southern California has a very serious problem with healthcare fraud," said Consuelo S. Woodhead, an assistant U.S. attorney in Los Angeles and coordinator of the office's Health Care Fraud Unit. "There is a large pool of elderly here," she said, with many living on limited incomes who become easy prey for those offering free services.


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