New Jersey Woman Pleas Guilty to $1 Million DNA Testing Medicare Fraud Scheme.

Tuesday, December 6, 2016
By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

On December 1, 2016, Sheila Kahl pled guilty in a New Jersey federal court that she took part in a $1 million Medicare fraud scheme.  Kahl admitted to two conspiracy charges deriving from a scheme involving a nonprofit organization that appeared to help seniors navigate through federal benefit programs. In reality, the organization served as a front to subject elderly victims into taking unnecessary DNA tests that Kahl and others would send to clinical labs for analysis. The participants in the scheme received "commissions" each time the labs were paid by Medicare or a private insurer.


Scamming Senior Citizens.

Under the disguise of working for The Good Samaritans of America, a nonprofit organization that helps guide senior citizens through benefit programs, Kahl and others were able to gain access to low-income senior housing complexes and put on fear-based presentations to scare and convince residents that the tests were needed to avoid vulnerability to major health problems.

Scott J. Lampert, a special agent for the U.S. Department of Health and Human Services' Office of Inspector General stated, "This conspiracy involved stealing private medical information and used particularly callous scare tactics to convince elderly and vulnerable Medicare beneficiaries to submit medically unnecessary DNA testing.  Today's plea resulted from joint law enforcement action to detect and block a planned multistate expansion of this deplorable scam against the program and its enrollees."

With no health professionals involved, Kahl and the others were able to conduct the check-swab DNA tests in the community rooms where the presentation they gave took place.


Kahl Did Not Act Alone.

Those who participated in the fraud scheme used Craiglists advertisements to recruit health care providers to authorize the tests and send them off to either a lab in Virginia or in California. The healthcare professionals received thousands of dollars per month to sign their names to requisition forms authorizing tests for patients they had never examined.

Co-conspirator Seth Rehfuss and Kahl then would pose as healthcare providers that sent the tests to the labs and were able to gain access to the patients' test results.  An investigation revealed that the conspirators were actively working toward spreading the fraud scheme outside of New Jersey to multiple other states.


Kahl Faces Jail Time.



At the end of the scheme, Medicare had paid out more that $1 million to two clinical laboratories. Rehfuss obtained more than $100,000 and paid "commissions" to Kahl of tens of thousands of dollars.

A criminal case against Rehfuss is currently pending in New Jersey federal court, however, Kahl faces up to 15 years in prison when she is sentenced in March 2017.


Contact Experienced Health Law Attorneys.

The Health Law Firm routinely represents pharmacists, pharmacies, physicians, nurses and other health providers in  Centers for Medicare and Medicaid Services (CMS) investigations, Medicare Audit defense, regulatory matters, licensing issues, litigation, inspections and audits involving the DEA, Department of Health (DOH) and other law enforcement agencies. Its attorneys include those who are board certified by The Florida Bar in Health Law as well as licensed health professionals who are also attorneys.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at

Sources:
Wolf, Alex. "NJ Woman Admits Role In $1M DNA Testing Medicare Fraud." Law360. (December 1, 2016). Web.

Park, Katie. "Pt. Pleasant Woman Part of $1M Medicare Fraud." Asbury Park Press. (December 1, 2016). Web


About the Author: George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law is an attorney with The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com  The Health Law Firm, 1101 Douglas Avenue, Altamonte Springs, Florida 32714, Phone: (407) 331-6620.

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12/6/2016

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