Another one bites the dust

U.S. Department of Justice

United States Attorney
James T. Jacks

Northern District of Texas

FEDERAL JURY CONVICTS LOCAL
AMBULANCE COMPANY OWNER

Defendant Fraudulently Billed Government More Than $3.5 Million for Transferring Patients to Scheduled Dialysis Appointments

DALLAS — The owner/operator of Royal Ambulance Service, Inc. and First Choice EMS, Inc., Muhammed Nasiru Usman, was convicted yesterday afternoon by a federal jury on all 14 counts of a superseding indictment charging various offenses, including health care fraud and money laundering, related to a health care fraud scheme he ran, announced U.S. Attorney James T. Jacks of the Northern District of Texas. The trial began on Tuesday, April 27, 2010, before U.S. District Judge Jorge A. Solis. Two other defendants charged in the case, Shaun Outen, 32, of Aubrey, Texas, and David McNac, 35, of Dallas, pleaded guilty to their role in the conspiracy prior to trial.

“This verdict is the culmination of a concerted and joint effort by the HHS Office of Investigations, the FBI and the Texas Medicaid Fraud Control Unit to quickly bring to justice those who prey on our poor and elderly for financial gain,” said Special Agent in Charge Mike Fields of the U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations, Dallas Regional Office.

Specifically, the jury found Usman, 50, of Arlington, Texas, guilty on one count of conspiracy to commit health care fraud, 12 counts of health care fraud and one count of engaging in monetary transactions in property derived from specified unlawful activity. The conspiracy count carries a maximum statutory sentence of five years in prison and a $250,000 fine. Each of the health care fraud counts carries a maximum statutory sentence of 10 years in prison and a $250,000 fine. Usman is scheduled to be sentenced by Judge Solis on July 28, 2010. McNac pleaded guilty on April 22, 2010, and is scheduled to be sentenced on July 21, 2010. Outen pleaded guilty on March 24, 2010; his sentencing is set for June 16, 2010.

When in business, Royal had offices in Dallas and DeSoto, Texas. First Choice EMS, Inc. was previously located in Carrollton, Texas. McNac worked as the director and/or manager of Royal and First Choice from April 2004 to July 2007. Outen served as the director of operations of Royal from August 2004 to October 2005 and then from May to November 2006, Outen served as an upper-level supervisor for Royal and First Choice.

Royal and First Choice primarily transferred patients on a non-emergency basis to and from dialysis treatments three times per week. The government presented evidence that Usman, Outen and McNac conspired to defraud Medicare and Medicaid by submitting fraudulent claims related to the transportation of dialysis patients. As part of the conspiracy, the defendants told Royal and First Choice employees to omit facts when documenting their transports of Royal and First Choice patients, such as whether the patients walked to the ambulance, in order to qualify the transports for reimbursement. Additionally, many of the companies’ records revealed that patients simply rode to their appointments in a captain’s chair in the back of the ambulance rather than lying on a stretcher. The government presented further evidence that Usman, Outen and McNac were responsible for submitting more than $3.5 million in fraudulent claims to Medicare and Medicaid through Royal Ambulance and First Choice EMS, resulting in payments of more than $1.2 million. 

The case is being investigated by the U.S. Department of Health and Human Services - Office of Inspector General, the FBI, Texas Attorney General Greg Abbott’s Office - Medicaid Fraud Control Unit, the U.S. Office of Personnel Management and IRS - Criminal Investigation.

Assistant U.S. Attorney Katherine Miller and Special Assistant U.S. Attorney Michael McCarthy are prosecuting the case.

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