September 17, 2011

USA: Judge sends Medicare offender to prison for 50 years

MIAMI, Florida / The Miami Herald / News / Miami Dade / September 17, 2011

Federal Court
A judge socked a convicted Miami healthcare executive with a 50-year prison sentence, longest ever imposed for Medicare fraud offender.

By Jay Weaver

New York transplant Lawrence Duran once ran a multimillion-dollar mental health company in Miami, lobbied Congress for his industry and tooled around town in a Maserati.

His next stop: federal prison — likely for the rest of his life.

On Friday, a federal judge slammed Duran, 49, with a 50-year prison sentence for orchestrating a staggering $205 million scam at his Miami-based chain of mental health clinics. The sentence may end up being the longest prison term ever imposed on someone convicted of Medicare fraud.

Duran’s lawyer, Lawrence Metsch, had urged the judge to be realistic and give him a sentence between 20 and 25 years, arguing that 50 years means a “death sentence because he would die in prison.” But U.S. District Judge James Lawrence King, after a three-day sentencing hearing, sided with the government’s push for the extraordinarily high sentence, saying there is a “critical need for deterrence against healthcare fraud” in South Florida, the nation’s capital of Medicare corruption.

Lawrence S. Duran

Previously, the highest Medicare fraud sentence was 30 years — given in 2008 to a Miami physician, Ana Alvarez-Jacinto, convicted in an HIV-therapy scheme.

After the sentencing, Duran shook his lawyer’s hand and then smiled to tearful relatives, as he shuffled in shackles out of the courtroom escorted by U.S. marshals. His ex-wife, Carmen Duran, and his only sibling, Kenia Duran Ramirez, said the judge’s sentence was not a “fair assessment” of the former executive’s life, saying his work for the mentally ill was “not all bad.”

This year, Duran and his girlfriend, Marinella Valera, co-owners of American Therapeutic Corp., pleaded guilty to a variety of conspiracy, fraud and money-laundering charges after they failed to reach plea deals with the Justice Department.

Duran, in custody since his arrest last October, was probably his own worst enemy during the sentencing hearing. Although he showed remorse for running American Therapeutic as a criminal enterprise for eight years, he also admitted he tried to steal as much money as he could from the taxpayer-funded Medicare program.

His company collected $87 million in Medicare payments after submitting $205 million in bogus bills, which he generated by paying kickbacks to recruiters to supply patients suffering from dementia, Alzheimer’s and addictions. He admitted they could not have benefited from his company’s purported group therapy sessions.

Justice Department attorney Jennifer Saulino called Duran a “cold, calculating man” who exploited both vulnerable patients and the government’s healthcare program for the elderly and disabled. She said he manipulated employees, including doctors, to change thousands of patients’ records to make it look like they needed the costly therapy when they didn’t.

Saulino pressured Duran repeatedly to admit what he did with his company’s Medicare millions, accusing him of not coming clean with the government.

“I’m facing a life sentence,” Duran testified Friday. “Do you think I would hold back on where the money is? If there were a cent, I would tell you where it is.”

Duran said that after paying hundreds of employees including himself, every spare cent was used for kickbacks to generate patients for his seven-clinic chain, which stretched from Miami to Orlando.

But at one point, Duran said he lived a “middle-class life” while orchestrating his multimillion-dollar conspiracy — despite buying the Maserati, sending his three children to private schools and paying for his ex-wife’s home in North Miami near the bay. He also owned other luxury cars, traveled with his girlfriend overseas, bought jewelry and tried to open a restaurant.

Saulino reminded him that it was an “extravagant life,” noting he earned between $1 million and $1.5 million yearly between 2003 and 2008 from his vast mental-health conspiracy.

Duran’s girlfriend, Valera, 40, a therapist, is scheduled to be sentenced Monday. Prosecutors plan to urge the judge to give her a 40-year prison sentence.

A total of 34 people, including American Therapeutic employees, doctors, therapists, nurses and recruiters, have been charged in the massive fraud case, which is being investigated by the FBI and Health and Human Services-Office of Inspector General.

The criminal case was sparked by a former nurse who once worked for American Therapeutic. She filed a civil whistle-blower case in 2007 with the Justice Department, which notified the company’s lawyer, prominent Washington, D.C., law firm, Patton Boggs.

But rather than shut down his business, Duran continued to bilk Medicare. Saulino confronted Duran that he would never have stopped defrauding the system until he was arrested.
His response: “The day I was arrested was the first day I felt some relief.”

Jay Weaver

Copyright 2011 Miami Herald Media Co.
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