The owner of a home health care company has admitted to a Medicare scam worth millions of dollars in false Medicare claims.

Romy Macasaet Jr., the owner of Home Bound Healthcare Inc., pleaded guilty to charges that he paid kickbacks to medical directors in exchange for referrals of elderly patients on Medicare.

Macasaet also admitted to using Medical Director agreements to hide evidence of the kickbacks.

Medicare Scam Leads to Fines, Jail Time

Macasaet’s criminal charges carry maximum financial penalties of up to $25,000 and a potential prison sentence of up to five years.

Sentencing will be determined at a hearing scheduled for February 2017. The plea agreement also allows the judge to impose a term of supervised release for up to three years after Macasaet serves his prison sentence.

Macasaet and Home Bound have also agreed to pay the U.S. government $6.8 million to resolve civil allegations under the False Claims Act and the Anti-Kickback Statute.

The two whistleblowers, both former employees of Home Bound who initiated a claim under the False Claims Act in 2012, will receive a share of the recovery in the amount of $964,000. Macasaet will personally pay $250,000 towards the civil claims.

According to a press release by the U.S. Attorney’s Office for the Northern District of Illinois, Macasaet’s Medicare scam involved paying thousands of dollars in kickbacks to medical directors in exchange for patient referrals.

Those referrals reportedly translated to $1.3 million worth of false Medicare claims for Home Bound.

The DOJ says that between December 2006 and September 2014, Macasaet paid out bribes totaling almost $790,000 to a group of about 20 medical directors. Those bribes allegedly induced false certifications of Medicare eligibility for home health services.

Home Bound then submitted claims for Medicare reimbursement based on those referrals. During the time Macasaet was paying out the kickbacks, Home Bound submitted almost 3,000 claims to Medicare, which paid the company $9.8 million in reimbursements.

The DOJ alleged Macasaet used medical director agreements to conceal the bribes. Macasaet allegedly paid the medical directors a regular fee worth thousands of dollars per month, characterized as compensation for dispatching a “list of duties.”

The civil False Claims Act allegations brought by the two whistleblowers alleged Home Bound submitted claims to Medicare for medically unnecessary services.

Home Bound’s Medicare scam allegedly generated certifications for home health care for patients who didn’t actually need it. While some patients got services they didn’t need, Home Bound allegedly neglected others who were genuinely in need of care.

The settlement agreement requires Macasaet to immediately resign his position at Home Bound and refrain from seeking future employment there.

Macasaet is also required to get rid of his ownership interest in the company within 120 days of formal entry of the agreement.

Home Bound itself will now be bound by a corporate integrity agreement with the Department of Health and Human Services’ Inspector General’s Office.

The agreement requires Home Bound to establish new policies and procedures to ensure future compliance with the requirements of Medicare, Medicaid and other federal health care programs.