Three Found Guilty in $154 Million Hospice-Care Fraud Scheme

The owner and two key officials of Merida Health Care Group, a Texas health-care company, were found guilty in connection with a $154 million hospice-care fraud scheme, the Department of Justice said.

Rodney Mesquias, the owner of Merida Health Care; Henry McInnis, the chief executive officer; and Francisco Pena, the company’s medical director, were found guilty Nov. 6 after a three-week trial on charges of conspiracy, health-care fraud, money laundering, obstructing investigations, and paying and receiving kickbacks, the DOJ said in a statement.

The scheme was aimed at obtaining reimbursements from Medicare for hospice services provided to patients who weren’t eligible to receive hospice services, the DOJ said.

Six Months or Less

Medicare reimburses for hospice services provided to patients who are expected to die within six months, the statement said. But Merida focused its scheme on patients who had long-term incurable diseases, such as Alzheimer’s and dementia, but who weren’t expected to die so soon.

This allowed the company to receive reimbursements for hospice services provided over a period of years, rather than just six months or less, the statement said.

Merida billed Medicare $154 million for hospice and home-health services between 2009 and 2018, receiving $120 million in payments, according to the indictment.

Merida also falsely told the patients they had less than six months to live, even going as far as to send them chaplains to discuss last rites and how to prepare for their imminent deaths, it said.

The company also paid kickbacks to medical directors of affiliated nursing homes and group homes who referred patients for hospice services and who falsely certified the patients as eligible for hospice, the DOJ statement said.

Mesquias will appeal the verdict, his attorney told Bloomberg Law Nov. 7.

Sentencing is set for June 17, 2020.

The case is U.S. v. Mesquias, S.D. Tex., No. 1:18-cr-00008, verdict 11/6/19.