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Nurses Indicted for Receiving Kickbacks for Home Health Medicare Referrals

Chicago – August 13, 2012 – A home health care agency in suburban Lincolnwood, two nurses who are part owners of the company and a third nurse affiliated with them, along with two marketers, were indicted on federal charges for allegedly participating in a conspiracy to pay and receive kickbacks in exchange for the referral of Medicare patients for home health care services, federal law enforcement officials announced today. 

Defendants Marilyn Maravilla and Junjee L. Arroyo, both part owners of Goodwill Home Healthcare, Inc., and three other defendants allegedly conspired to pay and receive approximately $400,000 in kickbacks to themselves, nurses, marketers and others for the referral and retention of Medicare patients that enabled Goodwill to bill Medicare approximately $5 million.

Also indicted were Ferdinand Echavia, a licensed nurse who referred patients, and Jean Holloway and Rakeshkumar Shah, both of whom marketed Goodwill’s services to Medicare patients.  The 29-count indictment was returned by a federal grand jury last Thursday and unsealed on Friday following the arrests of Holloway, 41, of Bellwood, and Shah, 46, of Des Plaines.

The information about this indictment should cause all owners, CEOs, and administrators of home health agencies and hospices to review the methods they are using to compensate and pay incentives to employees and non-employee marketers. This is only an indictment and has not yet gone to trial, so we’ll need to watch and learn more specifics about what these home health agency owners were actually doing that caused the Office of Inspector General for HHS, the United States Attorney for the Northern District of Illinois, and the FBI to investigate this home health agency.  The case falls under the umbrella of the Medicare Fraud Strike Force, which expanded operations to Chicago in February 2011, and is part of the Health Care Fraud Prevention & Enforcement Action Team.

We’ll watch for more details, and lessons you can learn from this case about what to do and not to do in compensating sales and marketing staff in home health and hospice.

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