By Juan A. Lozano and Nomaan Merchant
Associated Press

DALLAS — The owner of a Texas medical service provider was among seven people indicted in a massive health care fraud scheme that allegedly bilked Medicare and Medicaid of nearly $375 million, authorities announced Tuesday.

The federal indictment accused Jacques Roy, a doctor who owned Medistat Group Associates in DeSoto, of leading a scheme that billed Medicare for home health services that were not medically necessary or were not done.

Also indicted were Roy’s office manager as well as the owners of three home health agencies.

A federal indictment unsealed Tuesday accuses the agencies of using Roy to rack up millions of dollars in false claims.

The indictment alleged that from January 2006 through November 2011, Roy or others certified 11,000 Medicare beneficiaries for more than 500 home health services — more patients than any other medical practice in the U.S.

Investigators for the U.S. Health and Human Services department noticed irregularities with Roy’s practice about one year ago, officials said.

Roy had “recruiters” finding people to bill for home health services, said U.S. Attorney Sarah Saldana, the top federal prosecutor in Dallas.

Some of those alleged patients, when approached by investigators, were found working on their cars and clearly not in need of home healthcare, she said.

Medicare patients qualify for home health care if they are confined to their homes and need care there, according to a federal indictment.

Saldana said Roy used the home health agencies as “his soldiers on the ground to go door to door to recruit Medicare beneficiaries.”

“He was selling his signature,” she said.

For example, authorities allege Charity Eleda, one of the home health agency owners charged in the scheme, visited a Dallas homeless shelter to recruit homeless beneficiaries staying at the facility, paying recruiters $50 for each person they found.

A message was left Tuesday at Eleda’s Dallas-based company, Charry Home Care Services, Inc.

Phone messages and emails left with Medistat, located just south of Dallas, were not immediately returned on Tuesday.

Roy, 54, is charged with health care fraud and conspiracy to commit health care fraud.

He and the other defendants have been taken into custody and were expected to appear Tuesday afternoon before a judge in Dallas federal court.

The Centers for Medicare and Medicaid Services also announced the suspension of an additional 78 home health agencies associated with Roy.

The agencies were collecting about $2.3 million a month, said Peter Budetti, CMS’ deputy administrator for program integrity.

Until recently, HHS could not effectively track data to identify the kind of fraud now linked to Roy, who was billing beneficiaries “off the charts” for more than five years, officials said.

The department’s inspector general, Dan Levinson, told reporters the department’s technology “has not come online as quickly as we’d like to see.”

The department is now beefing up its data analysis and tracking other cases, Levinson said.

It has also established task forces in several U.S. cities to track Medicare fraud, officials said.

“We’re now able to use those data analytic tools in ways — in 2012 and 2011 — that no, we really could not have done in years past,” Levinson said.

Health care fraud is estimated to cost the government at least $60 billion a year, mainly in losses to Medicare and Medicaid. Officials say the fraud involves everything from sophisticated marketing schemes by major pharmaceuticals encouraging doctors to prescribe drugs for unauthorized uses to selling motorized wheelchairs to people who don’t need them.

“These are public programs, and we must protect them for future generations,” Saldana said.