The owner of a Long Island medical supply company was convicted
last week on charges of a $10.7 million Medicare fraud and wrongful
disclosure of private medical information under the Health
Insurance Portability and Accountability Act (HIPAA). (United
States v. Michel, E.D.N.Y., No. 07-cr-889-JFB, jury verdict
Helene Michel, the owner of Medical Solutions Management, Inc.,
was charged with stealing patient records from nursing homes and
using the individually identifiable health information of patients
contained in those stolen records to transmit fraudulent claims to
Medicare for equipment and services that the company never
provided. Michel used the proceeds of the scheme, which was
carried out over the course of more than four years, to buy a $2.2
million home and to fund a pension plan and investment brokerage
account worth $2 million.
In the March 2012 indictment, prosecutors sought forfeiture of
over $1.2 million, in addition to the funds in the brokerage
account and other bank accounts. Michel faces a maximum
sentence of 10 years' imprisonment on each count, as well as
fines of up to $250,000 per count.
According to prosecutors, the case represents one of the first
criminal prosecutions in the United States for wrongful disclosure
of patient information under HIPAA, and their comments made in the
announcement of the verdict indicate that it
likely will not be the last.
U.S. Attorney Loretta E. Lynch called the verdict a
"warning to all that we will tenaciously investigate
violators, protect patient rights and vindicate the hard-earned
support taxpayers provide the Medicare program."
FBI Assistant Director-in-Charge Fedarcyk added to Lynch's
cautionary statement: "The defendant showed no regard for
patients' privacy rights when she stole their personal identity
information to file false medical claims. She padded her own
pockets at the expense of the Medicare kitty. The verdict today
should serve as a warning to those who disregard privacy laws to
defraud publicly funded programs meant to help our
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