Bernice Brown, Medicare Fraud, Michigan 2006

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Medicare Fraud Scheme Unfolds in Detroit-Area Clinic

A federal jury has convicted Bernice Brown, the owner and president of Wayne County Therapeutic Inc. (WCT) in Livonia, Mich., and Daniel Smorynski, the vice president of WCT, for their roles in a $23 million Medicare fraud scheme.

The six-day trial revealed that Brown purchased fake physical and occupational therapy files from third-party contractors and billed Medicare as if WCT therapists had provided the services. Smorynski was in charge of billing at WCT and aided in the submission of claims for services he knew WCT did not provide.

The evidence presented at trial showed that between approximately October 2002 and September 2006, Brown and Smorynski submitted approximately $23.2 million in claims to Medicare for physical and occupational therapy services that were never provided. Medicare paid approximately $6,537,630.34 of those claims.

Brown was convicted of one count of conspiracy to commit health care fraud and 10 counts of health care fraud, while Smorynski was convicted of one count of conspiracy to commit health care fraud and six counts of health care fraud. Each substantive health care fraud charge and the conspiracy charge carry a maximum penalty of 10 years in prison and a $250,000 fine.

The scheme also involved causing WCT to submit fraudulent claims for psychotherapy services. In January 2006, when Congress enacted a cap on physical and occupational therapy services, Brown and Smorynski devised a scheme to avoid the cap by billing for psychotherapy services. They even launched a lobbying effort to repeal the cap, which included WCT staff drafting letters and petitions to Congress purportedly on behalf of Medicare patients.

Today’s guilty verdicts were announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of HHS, Office of Inspector General’s (HHS-OIG) Chicago Regional Office.

As a result of the convictions, Brown and Smorynski will face the consequences of their actions. The exact sentence or outcome is yet to be determined. The case serves as a reminder of the importance of transparency and accountability in the healthcare industry.

This case was investigated by the FBI’s Detroit Field Office and the HHS, Office of Inspector General’s (HHS-OIG) Chicago Regional Office. The case is being prosecuted by the U.S. Attorney’s Office for the Eastern District of Michigan.