(Reuters) - The U.S. Justice Department has brought new charges over a scheme that it says enabled Tenet Healthcare Corp to fraudulently bill state Medicaid programs for $400 million, according to an indictment made public on Wednesday.
William Moore, the ex-chief executive of Atlanta Medical Center Inc, which had been operated by Tenet; and Edmundo Cota, the ex-head of a clinic operator that provided prenatal care to Hispanic women, were charged in an indictment filed in Atlanta federal court.
They were added as defendants in a case the Justice Department brought in February against John Holland, a former Tenet senior vice president. The trio faces multiple charges including conspiracy and wire fraud, according to the indictment.
The charges came after Dallas-based Tenet and two of its Atlanta-area units in October 2016 reached a deal with the Justice Department and agreed to pay more than $513 million to resolve criminal charges and civil claims in a related case.
Brian McEvoy, a lawyer for Moore at the law firm Polsinelli PC, said in a statement he was “extremely disappointed” with the agency’s action.
“Mr. Moore is not guilty and we look forward to presenting this case to a jury at trial,” McEvoy said.
A lawyer for Cota, the former CEO of medical clinic operator Clinica de la Mama, could not be immediately identified. A Justice Department spokesman declined to comment.
The indictment said that from 2000 to 2013, Holland, Moore Cota engaged in a scheme to cause Tenet to pay over $12 million in bribes and other illegal inducements to Clinica, which operated clinics in Georgia and South Carolina.
In exchange, the owners and operators of Clinica referred patients to Tenet hospitals and arrange for medical services for Clinica patients related to child birth at the hospitals.
To justify the $12 million, Holland, Moore, Cota and others created pre-textual contracts between Tenet’s hospitals and Clinica, which provided services mostly to undocumented Hispanic women, the indictment said.
In order to steer patients to Tenet hospitals in Georgia and South Carolina, Cota and others blocked doctors from seeing patients at Clinica unless the physicians agreed to deliver their babies at Tenet hospitals, the indictment said.
Prosecutors said the scheme enabled Tenet hospitals to fraudulently bill the Georgia and South Carolina Medicaid programs for over $400 million, and allowed Tenet to receive at least $127 million on those claims.
The case is U.S. v. Holland, et al, U.S. District Court, Northern District of Atlanta, No. 17-cr-234.
Reporting by Nate Raymond in Boston; Editing by Richard Chang