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MAN GETS PRISON TIME FOR $100 MILLION TRICARE FRAUD --

U.S. Attorney: "This conviction, along with the conviction of the

corporation, furthers our goal to protect the Tricare program."

For more about the TRICARE program, use the VA Watchdog search engine...click here...
http://www.yourvabenefits.org/sessearch.php?q=tricare&op=and

Story here... http://www.chicagotribu
ne.com/news/chi-ap-wi-militaryhealthfra,0,6459619.story

Story below:

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Man gets prison time for $100 million health fraud

By RYAN J. FOLEY
Associated Press Writer

MADISON, Wis. -- A former health care executive was sentenced Tuesday to five years in prison for helping his Philippines-based company swindle $100 million from the U.S. military health insurance program.

Thomas Lutz, 41, said in federal court he took responsibility for the six-year scheme in which Health Visions Corp. bilked $99.9 million from the military's Tricare program through inflated and fraudulent claims.

U.S. District Judge Barbara Crabb said the five-year sentence was modest given the extent of the fraud but the longest she could impose for the single count to which Lutz pleaded guilty under a plea deal. She said he deserved punishment for "repeated acts of fraud and concealment."

"It's just horrifying that you were able to take as much money as you did," Crabb told Lutz.

The scheme deprived Tricare, which insures 9.2 million current and retired service members and dependents, of money it could have used to provide care for others, Crabb said.

In April, Crabb ordered Health Visions to pay $99.9 million in restitution. Under her order, the company must sell all of its assets, including land, hospitals and office buildings, within 10 months. She said Lutz would be responsible for paying the remainder, including at least 25 percent of his income once he is released from prison.

Crabb gave Lutz until March 18 to report to prison. Prosecutors asked for the nine-month delay so Lutz could help the government recover as much money as possible from the company.

Formed in 1997, Health Visions owned and operated hospitals and clinics in the Philippines and billed Tricare on behalf of other health care providers. The company served thousands of U.S. military retirees living in the Philippines, where bases were located until the early 1990s.

As president of the company in 2003 and 2004, Lutz oversaw the work of employees who prepared hundreds of fraudulent and inflated claims billed to U.S. taxpayers, Crabb said. Lutz also signed an illegal agreement in 1998 in which he referred patients to a medical clinic in exchange for kickbacks, she said.

Health Visions and Lutz were charged in a 75-count indictment in 2005. Lutz pleaded guilty to conspiracy to pay kickbacks in December 2006 and agreed to cooperate with prosecutors under a deal that Crabb said gave him "a huge break."

The company was reimbursed $163 million by Tricare between 1998 and 2004, and prosecutors believe at least $99.9 million of that was fraudulent. Pentagon auditors have criticized Tricare program managers for moving slowly to uncover and stop the fraud.

The scheme by Health Visions is the biggest in a long-running investigation of Tricare fraud in the Philippines handled by prosecutors in the Western District of Wisconsin, where Madison-based WPS Health Insurance is the subcontractor that pays overseas Tricare claims. About three dozen U.S. military veterans and Philippine workers have been charged.

"This conviction, along with the conviction of the corporation, furthers our goal to protect the Tricare program," U.S. Attorney Erik Peterson said in a statement. "Our veterans deserve quality health care, and our nation deserves a program free from fraud. We will continue to vigorously investigate and prosecute these cases."

Crabb blamed Lutz for encouraging others to join the fraud who later ending up in legal trouble. The "consequences of your very, very selfish actions" were enormous, she said.

Lutz, an American citizen whose wife and four young sons have moved to Missouri from the Philippines, read a brief statement in which he took full responsibility for his company's actions.

"I would like to apologize to the Department of Defense," he said. "I am truly sorry for all those who have been affected."

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posted by Larry Scott
Founder and Editor
VA Watchdog dot Org

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