Ms. Martinez pleaded guilty for her role in three fraud schemes that caused the submission of around $15.3 million in false and fraudulent claims to Medicare, around $10.8 million of which were paid by Medicare.
Ms. Martinez admitted that in March 2006 she devised a scheme with co-conspirator Jose Rosario to open a clinic that purported to specialize in infusion and injection therapy services in Michigan. She admitted in court that the sole purpose of the clinic was to defraud Medicare.
Ms. Martinez and her co-conspirators opened Sacred Hope Medical Center in Southfield, Mich., in Oct. 2006. According to court documents, Ms. Martinez was an owner of the clinic and managed the clinic on a day-to-day basis. Ms. Martinez and Mr. Rosario recruited various co-conspirators into their scheme, including an office manager, Lill Vargas-Arias, to help run the clinic; a physician, purportedly to treat patients at the clinic; and recruiters/drivers who were in charge of bringing Medicare beneficiaries to the clinic. Mr. Rosario pleaded guilty for his role in the scheme on Aug. 18, and the office manager pleaded guilty to her role on Sept. 2.
Ms. Martinez admitted in her guilty plea that during the time Sacred Hope was open, the clinic routinely billed the Medicare program for services that were medically unnecessary or were never provided. She admitted she was aware that the clinic had purchased only a small fraction of the medications for which it had billed Medicare and that patients were prescribed medications at the clinic based not on medical need, but on what medications were likely to generate Medicare reimbursements. Ms. Martinez, along with Mr. Rosario, also admitted to helping falsify medical files maintained by the clinic to make the treatments purportedly being given there appear legitimate.
Ms. Martinez also admitted that Medicare beneficiaries were not referred to Sacred Hope by their primary care physicians or for any other legitimate medical purpose, and they were recruited to come to the clinic through the payment of kickbacks. In exchange for those kickbacks, Ms. Martinez admitted that the Medicare beneficiaries would visit the clinic and sign documents indicating that they had received the services billed to Medicare. According to court documents, kickbacks came in the form of cash and prescriptions for narcotic drugs.
In March 2006, Ms. Martinez became involved in a separate scheme to recruit Medicare beneficiaries to visit Dearborn (Mich.) Medical Rehab Center. Ms. Martinez, along with other co-conspirators, agreed to recruit and pay Medicare beneficiaries at DMRC in exchange for a percentage of the Medicare reimbursements the beneficiaries would generate. Ms. Martinez admitted that she and her co-conspirators sent Arnaldo Rosario to Detroit to oversee the payment of the patients, and she and her partners provided the cash to pay the kickbacks. DMRC routinely billed the Medicare program for services that were medically unnecessary and, in many instances, never provided, according to the release.
Ms. Martinez also helped open a second infusion and injection clinic, Xpress Center, in Livonia, Mich., in Nov. 2006. She admitted that she and her co-conspirators used the same fraudulent practices to open and then operate XPC as Sacred Hope, including creating fictitious patient files to cover up fraudulent billings to Medicare.
Ms. Martinez faces a maximum penalty of 10 years in prison and a $250,000 fine. She is scheduled to be sentenced in February.
Read the Department of Justice’s release on Daisy Martinez.
