Saturday, June 2, 2007

Medical biller accused of scamming $300G from GHI

NEW YORK - The accused brains behind a medical billing scam for phony neurosurgeries proved to be no brain surgeon himself, federal prosecutors said.

A Mount Vernon man who worked as a medical biller for a Hawthorne company concocted a scheme to submit bogus claims and post-operative reports to the insurer Group Health Inc. for 20 brain surgeries for three New York City municipal workers and their family members, federal authorities said. The scheme netted more than $300,000 for Charles Pritchett and his three alleged co-conspirators, according to federal prosecutors.

The scam fell apart when an internal audit by Manhattan-based GHI found so many brain operations clustered among three subscribers. GHI received claims for nine brain surgeries from one family and nine from another.

The third alleged co-conspirator submitted claims for brain surgeries for himself and his wife.

"We picked it up through the audit process," said Ilene Margolin, GHI's senior vice president for corporate affairs, "It raised red flags."

Pritchett, 39, of South Ninth Avenue, was arrested Thursday along with Dorothy L. Smith, 42, of Manhattan, and Michael Biscotti, 37, of Staten Island. A fourth suspect, Stanley Cannella, 36, of Manhattan, has not yet been arrested. It is unclear how Pritchett knew the other defendants. They were all charged with health care fraud and mail fraud in a six-count indictment unsealed in U.S. District Court in Manhattan.

Pritchett's lawyer Edward D. Wilford did not return calls seeking comment. Lawyers for the other defendants could not be reached for comment. Cannella's home number has been disconnected.

The scheme began in 2003 when Pritchett used his access to the medical billing company's computer to download legitimate insurance claim forms and post-operative reports from a Manhattan neurosurgeon, federal prosecutors said. Those forms provided the templates he would use for the next three years, federal authorities and GHI said.

Pritchett swapped out the two patients' identifying information for that of two of his alleged co-conspirators, Cannella and Smith, and started submitting bogus claims. On May 30, 2003, the first of the bogus claims was paid by GHI. The insurance provider cut a check for $14,142 to Cannella, who deposited it in his bank account, federal prosecutors said.

Between April 2003 and September 2006, Pritchett and Cannella submitted nine claims for reimbursement for brain surgeries on Cannella, his wife and his two sons. None of those procedures ever occurred, federal authorities said. But all of them were paid, to the tune of $142,268.

Smith and Pritchett submitted nine claims for Smith, her husband and their two daughters between June 2003 and December 2005. All nine claims were paid, including three for the same bogus operation. In all, GHI paid Smith $131,397 in phony claims, federal authorities said.

Biscotti and Pritchett submitted bogus claims for his and hers brain surgeries on Biscotti and his wife in March and June 2004, according to federal authorities. GHI paid Biscotti $31,041 for the two bogus claims.

After GHI did the internal audit, it launched its own investigation and then contacted the U.S. postal inspector and the U.S. Attorney's Office, Margolin said.

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