IRS – Doctor And Employee Indicted In $759,000 Medicare Fraud Scheme

Santa Ana, California – LAWFUEL – The Legal Newswire – Yesterday afternoon, a physician from Huntington Beach, California was arrested and made his initial appearance in United States District Court in Santa Ana on charges that he and a co-defendant, who was arrested by federal agents in Arizona this morning, engaged in a scheme to defraud Medicare and to using the proceeds of their scheme to promote their fraud.

Kenneth Wayne Ferguson, the physician of record at Huntington Beach Medical Center, which operated from July 2004 through October 2004, was indicted by a federal grand jury in Santa Ana, along with Olena Kulakova, on 10 counts of health care fraud in a scheme that defrauded Medicare of over $759,000. Additionally, Dr. Ferguson was indicted on four counts of money laundering related to the scheme.

According to the indictment, Dr. Ferguson and Kulakova billed Medicare for physician services rendered to patients that were performed by Kulakova, an employee of Huntington Beach Medical Center. These services were rendered when Dr. Ferguson was not in the office. Further, the indictment details that Kulakova held herself out to be either a doctor and a Physician’s Assistant and she performed physician services on behalf of Dr. Ferguson, even though she had no medical licensing in the State of California.

As a part of the scheme, both Dr. Ferguson and Kulakova caused Medicare to be billed for comprehensive evaluation and management visits for patients. These visits, which Medicare indicates typically last from 25 to 45 minutes of face to face time with a patient, were billed where patients were seen for only 5 to 10 minutes. Further, Dr. Ferguson and Kulakova directed and caused kickbacks to be paid to patients to come to Huntington Beach Medical Center for physician services.

The indictment also details how Dr. Ferguson laundered the money he received from Medicare as a part of his fraud scheme. Specifically, Dr. Ferguson was charged with four counts in the indictment with promoting the carrying on of the scheme when he made payments to Kulakova from the Medicare payments he received.

An indictment is a charging document alleging violations of statutes. All defendants are presumed innocent of charges unless and until proven guilty before the court.

Dr. Ferguson faces a statutory maximum 180 years in federal prison and fines totaling $2,000,000 if convicted of all of the violations alleged in the indictment. Kulakova faces a statutory maximum 100 years in federal prison if convicted of the crimes that are alleged in the indictment.

The case against Dr. Ferguson and Kulakova was investigated by agents of IRS – Criminal Investigation, the US Department of Health and Human Services – Office of Inspector General, the Federal Bureau of Investigation, and the California Department of Justice Bureau of Medi-Cal Fraud and Elder Abuse.

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