Civil Complaint Alleges Fraud By Operators Of Community Mental Health Clinics

PHILADELPHIA – On July 20, 2015, the U.S. Attorney’s Office for the Eastern District of Pennsylvania filed a civil health care fraud lawsuit under the False Claims Act against Melchor Martinez, Melissa Chlebowski, both of Allentown, PA, and their businesses Northeast Community Mental Health Centers (in Philadelphia), Lehigh Valley Community Mental Health Centers (in Allentown, Easton and Bethlehem), and North Carolina Community Mental Health Centers (in Raleigh, North Carolina).  The institutional defendants are community mental health clinics funded largely by Medicaid and Medicare. The lawsuit was announced by United States Attorney Zane David Memeger.

Martinez was convicted of Medicaid fraud in 2000 by the Commonwealth of Pennsylvania.  As a result, he was excluded from participating in all federally funded health care programs, including Medicaid and Medicare.  The exclusion prohibited Martinez from owning, managing or receiving payments from any federally funded health care provider.  The United States alleges that in spite of his exclusion, Martinez, assisted by his wife Chlebowski, continued to own and operate the Northeast and Lehigh Valley clinics, and that, in 2009, while his exclusion was ongoing, he started up the North Carolina clinic in Raleigh, North Carolina.

The United States alleges that during Martinez’s exclusion, the Northeast and Lehigh Valley clinics also billed Medicaid for psychiatrist visits of very brief duration, sometimes as little as two to three minutes, while fraudulently representing that patients were being seen for a 15 minute visit.  In addition, the Northeast and Lehigh Valley clinics billed Medicaid and Medicare for the services of “therapists” who were not qualified to provide mental health services.  The complaint also alleges that the Northeast and Lehigh Valley clinics fraudulently billed Medicare for therapy services allegedly provided without the requisite supervision.

“This civil complaint reflects our focus on pursuing individuals who defraud Medicaid and Medicare, especially after they have previously defrauded those programs and been barred from participating in them,” said Memeger.

The complaint was filed in a case brought under the qui tam provisions of the False Claims Act by a private citizen, called a “relator,” who may bring suit on behalf of the United States and share in any recovery. The United States may intervene in the case, as it has done here.  Under the False Claims Act, a person that causes the submission of false or fraudulent claims to the government is liable for three times the government’s damages, plus civil penalties for each false claim. The claims asserted against the defendants are allegations only, and there has been no determination of liability.

This matter was investigated by the U.S. Department of Health and Human Services’ Office of Inspector General and the U.S. Attorney’s Office for the Eastern District of Pennsylvania, with assistance from the Pennsylvania Office of Attorney General and the North Carolina Department of Justice. The case is assigned to Assistant U.S. Attorneys Judith A. Amorosa, Susan R. Becker, and Viveca D. Parker of the Civil Division, and health care fraud auditor George Niedzwicki.

The lawsuit is captioned United States v. Melchor Martinez, et al. (E.D. Pa.).