Prosecutors say California hospice fraud scheme cost government $30 million

Felony federal charges were filed against three people, including two Southern California residents, accused in a scheme that defrauded the government of more than $30 million for hospice services provided to patients who were not terminally ill at two Pasadena-based hospice companies, according to the U.S. Department of Justice.

Dr. Victor Contreras, 66, of Santa Paula, and Callie Jean Black, 63, of Lancaster, were arrested Tuesday, March 8 and named in a 14-count indictment filed in U.S. District Court in Los Angeles, the DOJ said in a news release. Juanita Antenor, 59, a former Pasadena resident and owner of the hospice companies, was also named in the indictment.

Contreras and Black pleaded not guilty on Tuesday and were granted release on bond, said Thom Mrozek, spokesman for the U.S. Attorney’s Office in Los Angeles.

Attorneys for Contreras and Black didn’t have any immediate comment on the allegations.

Antenor owned Arcadia Hospice Provider Inc. — one of the hospice companies listed in the indictment  and remains at large, according to the DOJ. She is believed to be in the Philippines.

Antenor controlled a second hospice company, Saint Mariam Hospice Inc., that also billed Medicare and Medi-Cal for fraudulent hospice services, the release said. In some cases, the companies submitted bills for services that were never provided.

Between September 2014 and April 2019, Arcadia Hospice Provider submitted to Medicare nearly $23 million in claims for hospice services provided to beneficiaries, the release said. Meanwhile, Saint Mariam Hospice submitted to Medicare approximately $13.7 million in claims for hospice services from February 2015 to April 2019.

Arcadia Hospice Provider received approximately $18.8 million for those claims; Saint Mariam Hospice received nearly $11.4 million, the release said. Arcadia and Saint Mariam also submitted together more than $5.5 million in claims to Medi-Cal, which paid the companies a total of just over $1.35 million, the DOJ said.

Contreras is linked to about $5.1 million of the claims paid by Medicare, the release said.

Contreras is accused of providing fraudulent certifications for patients, including some he claimed to have examined, but never actually saw, the DOJ said. The DOJ said this happened while he was on probation imposed by the California Medical Board. Records show Contreras was placed on a 10-year probation by the board in February 2015 for violating several statutes involving the regulation of dangerous drugs or controlled substances in the care and treatment of multiple patients.

Black, a marketer, was allegedly one of several paid by Antenor for illegal kickbacks for the patients referred to Arcadia and Saint Mariam, the release said.

Antenor was indicted on six counts of health care fraud, and an additional four counts of paying illegal kickbacks for health care referrals, the release said. Contreras was indicted on five counts of health care fraud. Black was indicted on four counts of receiving illegal kickbacks.