Psychiatric hospital CEO sentenced to 25 years prison for defrauding Medicare of $67 Million

A Florida psychiatrist and CEO of the Hollywood Pavilion psychiatric facility was sentenced to 25 years in prison for submitting false Medicare claims for $67 million. A jury also found that Medicare was tricked into paying $40 million to Hollywood Pavilion and that the CEO, ΠKaren Kallen-Zury covered up the fraud scheme by falsifying the records of ineligible patients and fabricating marketing contracts with patient recruiters who were paid significant sums of money per patient.

According to a Department of Justice Ms. Kallen-Zury is the first executive from a licensed state hospital to be prosecuted by the Medicare Fraud Strike force for committing Medicare fraud.

The DOJ also said that the hospital deliberately targeted disabled substance abusers by conning them to spend weeks locked down in a psychiatric hospital. The defendants paid illegal bribes and kickbacks to patient brokers to obtain Medicare beneficiaries as patients, at Hollywood Pavilion but they did not qualify for psychiatric treatment.

From 2003 through at least 2012 Hollywood Pavilion billed Medicare nearly $70 million for services that were not properly rendered for patients that did not qualify for services being billed, and for claims for patients who were procured through bribes and kickbacks.

Similar prosecutions and prison sentences are expected in different parts of the country.