Lawyer, Doctor, Patient Recruiter Guilty In $112M Florida Health Fraud
Miami Herald (FL)
A lawyer who partly owned two South Florida addiction treatment centers and a patient recruiter who worked for him pleaded guilty Wednesday to healthcare-related criminal charges, joining a physician who admitted guilt earlier in the week in a $112 million insurance fraud case involving “sober homes.”All three defendants opted to strike plea deals offered by the Justice Department after two Bal Harbour brothers, Jonathan and Daniel Markovich, were found guilty in November of bilking private insurance companies for substance-abuse services that were either not provided or unnecessary.
Their facilities’ detox patients were given a “comfort drink” to sedate them, along with other enticements, so they would keep coming back for costly substance-abuse treatments, prosecutors said.
“Their tactics were brazen and the dollar losses immense,” Miami FBI Special Agent in Charge George Piro said in a statement after the brothers’ trial, asserting they tried “to cheat their way to riches.”
Now, the patient recruiter and the doctor are facing more potential time in prison than the lawyer who co-owned the addiction treatment centers with Jonathan Markovich, federal court records show. In the plea deals for the three defendants, prosecutors recommended sentencing guidelines for all three defendants that U.S. District Judge William Dimitrouleas will consider for their punishment this spring.
Richard Waserstein, a Bay Harbor Islands attorney and co-owner of Compass Detox in Pembroke Pines and WAR Network LLC in Hallandale Beach, pleaded guilty to a single charge of conspiring to launder money from fraudulent healthcare proceeds. He now faces from 41 to 51 months in prison. As part of his plea deal, Waserstein also must pay restitution of $2.7 million to several major private insurance companies that were fleeced by his substance-abuse clinics and pay a forfeiture fine of $5.8 million to the U.S. government, records show.
Recruiter Frank Bosch Jr., an employee and contractor of Compass Detox, pleaded guilty to a conspiracy to offer and pay kickbacks to patients and now faces from 46 to 57 months in prison. As part of his plea deal, Bosch, who lives in Miami-Dade County, must pay restitution of $2.88 million to the private insurers but a forfeiture fine of only $7,331 to the government.
Waserstein’s plea deal also contrasts sharply with one for Drew Lieberman, a Miami-Dade physician who was the chief medical officer of Compass Detox. On Monday, Lieberman pleaded guilty to a single charge of conspiring to commit healthcare fraud for admitting patients and submitting false medical claims. Now he now faces 10 years in prison and must pay restitution of $18.5 million to the private insurers and a forfeiture fine of $390,000 to the government.
Waserstein’s defense attorneys, David O. Markus and Margot Moss, declined to comment, as did Lieberman’s lawyer, Ryan Stumphauzer. Bosch’s lawyer, Pat Dray, could not be immediately reached for comment.
It is not exactly clear from the court record why Justice Department prosecutors reached such different plea deals with the three defendants in a case that centered around healthcare fraud and addiction treatment facilities dubbed “sober homes” — both perennial problems in South Florida.
But according to factual statements filed with the plea deals, “Waserstein was less involved in the day-to-day of the [two] businesses than [Jonathan] Markovich, but Waserstein nonetheless knew of and tolerated kickbacks to patients.
“[A]nd while he did not always know the full extent of [the] kickback payments, [Waserstein] understood that insurance companies would not reimburse for Compass Detox and WAR’s services if they knew that patients had been paid kickbacks to attend Compass Detox and WAR,” the statement says.
As a result, Waserstein was not charged with the conspiracies alleging healthcare fraud and paying kickbacks to patients, according to an indictment. He was only charged with a money laundering conspiracy and related counts. That affected the amount of time he’s facing in prison.
In November, the Markovich brothers were convicted of a healthcare fraud scheme built upon a network of recruiters who enticed patients with free airline tickets, illegal drugs and cash payments, according to evidence at their trial in Fort Lauderdale federal court. The main count alone carries up to 20 years in prison.
Jonathan Markovich owned the two substance-abuse companies with Waserstein and was a CEO of Detox Center. Daniel Markovich was also a CEO of Detox Center and its compliance officer.
Prosecutors accused the brothers of shuffling patients between Compass Detox and WAR to bill millions of dollars for purported treatments to the private insurers, including Aetna, Blue Cross/Blue Shield and Magellan Health. Among the fraudulent practices: detox services, therapy sessions and urinalysis tests, prosecutors said.
Compass Detox patients were given not only the “comfort drink” but also given large amounts of controlled substances to keep them compliant so they could be repeatedly cycled through Compass Detox and WAR to generate maximum billing and revenue, according to federal prosecutors James Hayes and Jamie de Boer.
In addition to healthcare fraud offenses, Jonathan Markovich, who owned the two detox facilities with Waserstein, was also convicted of several money laundering offenses and bank fraud stemming from his applications for federally guaranteed business loans provided by the U.S. government during the COVID-19 pandemic.
A few other defendants in the brothers’ healthcare network had previously pleaded guilty before their trial.