A California man who operated rehabilitation clinics in Walnut, Torrance and Los Angeles and defrauded Medicare out of approximately $3 million by billing for unneeded or unnecessary services has been sentenced to 121 months in federal prison.

Among other defendants, Simon Hong owned physical therapy clinics operated by companies called Hong’s Medical Management, Inc., CMH Practice Solution, and HK Practice and Solution, Inc. As part of the scheme, Hong recruited Medicare beneficiaries and provided uncovered services like massage and acupuncture for them. Even though the beneficiaries did not receive actual physical therapy, Hong’s co-conspirators billed Medicare for physical therapy and then funneled 56 percent of the reimbursement funds back to Hong.Through this scheme, Hong and his co-conspirators billed Medicare from the spring of 2009 until November 2013 and received approximately $2,929,775 in reimbursements, of which Hong received approximately $1,640,674. During today’s sentencing hearing, Judge Carter ordered Hong to pay $2,929,775 in restitution.

According to Christian J. Schrank, HHS-OIG Special Agent in Charge of the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG). “Fraudulently billing the program for therapies never provided will cost Mr. Hong years in prison. As this sentencing shows, not just providers, but business owners who are partners in these schemes, will pay a price. Together with our law enforcement partners, we will pursue all those involved in stealing from the Medicare trust fund.”

This case highlights what Deputy Director Sally Yates said in her memo regarding the Dept, of Justice intent to hold those persons who perpetrated the fraud, personally liable and not to allow them to hide behind a corporate entity or shell to avoid liability.

You may also like:Deputy Yates Has Something to Say…Yates Memo and the Department of Justice

Written by Michael Rosen, ESQ
ProviderTrust Co-Founder, mrosen@providertrust.com
Connect with Michael on Linkedin

Michael brings over 20 years of experience founding and leading risk mitigation businesses, receiving numerous accolades such as Inc Magazine’s Inc 500 Award and Nashville Chamber of Commerce Small Business of the Year.