N.J. man indicted for more than $140 million Medicare and Medicaid fraud

A New Jersey man and his business were indicted for allegedly defrauding Medicare and Medicaid out of more than $140 million, the Justice Department announced Thursday.

From January 2015 to September 2018, Kevin Breslin, 56, and KBWB Operations LLC, which does business as Atrium Health, allegedly diverted funds from Wisconsin nursing facilities to Atrium owners. As a result, many of the facilities had to cut back on quality of care and were understaffed.

"In addition, the indictment alleges that Breslin and Atrium withheld insurance premiums from employees' paychecks but failed to pay those monies over to the third-party administrator for use in paying health claims, causing payment of employees' health claims to be stopped," the Justice Department said Thursday. "The indictment further alleges that the defendants withheld 401(k) retirement savings account contributions from employees' paychecks but failed to pay those monies over to the third-party pension administrator."

Atrium billed Medicare for over $189 million and received over $49 million and billed Medicaid for over $218 million and received over $93 million. The lack of funds at the nursing facilities resulted in a shortage of clean diapers, inadequate wound care supplies, inadequate cleaning supplies, and a lack of durable medical equipment and respiratory supplies.

"The diversion of funds caused non-payment to vendors, which caused numerous services to be cut off, including physical therapy for residents, fire alarm monitoring services, phone and internet services preventing staff from obtaining prescription orders and accessing electronic medical records systems," the Justice Department said.

Breslin and Atrium have been charged with healthcare fraud, six counts of wire fraud, three counts of mail fraud, conspiracy to commit tax fraud, and conspiracy to commit money laundering.

If convicted, Breslin faces five years in federal prison on the conspiracy to commit tax fraud charge, and 20 years on each health-care fraud, wire fraud, mail fraud, and conspiracy to commit money-laundering charge.