Insurance Fraud NEWS
Rockland man sentenced to prison for health care fraud
April 22, 2019, Rockland, ME
A Rockland man was sentenced April 16 to four months in prison for health care fraud and embezzlement.
Michael A. Morrison, 42, was sentenced in U.S. District Court in Portland by U.S. District Court Judge Nancy Torresen. His full sentence includes four months in prison, three years of supervised release, including four months of home confinement during the supervised release, according to U.S. Attorney Halsey Frank.
Morrison was also ordered to pay $206,000 in restitution.
He had pleaded guilty on Dec. 11, 2018 in U.S. District Court in Portland to health care fraud and embezzlement from a health care benefit program.
According to the court documents filed by the U.S. Attorney’s Office, between 2005 and 2016, Morrison was the manager of the Trade Winds Health, Swim and Tan Club in Rockland, which also operated a physical therapy practice known as Coastal Physical Therapy.
From 2014 through 2016, the defendant billed approximately $175,000 in false claims for reimbursement to Medicare, MaineCare, Anthem Blue Cross and Blue Shield and a Veterans Administration health care program. Some claims were false because the defendant exaggerated the length of time therapists spent with patients. He also made claims for appointments that were cancelled, for services that he provided even thought he was not properly licensed, and using the names of therapists who were not working on the dates claimed, according to the U.S. Attorney’s Office.
Morrison also embezzled over $26,000 from the health club by using a health club credit card to pay for personal Amazon.com purchases and stole about $4,500 in cash that he failed to deposit to the Health Club’s bank account, confirmed by the U.S. Attorney’s Office.
He could have been sentenced to up to 10 years in prison and fined up to $250,000 on each count. His sentencing did not occur until after the completion of a presentence investigation report by the U.S. Probation Office.
The U.S. Attorney’s Office stated that the case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General; the Maine Attorney General’s Office, Healthcare Crimes Unit; the Department of Veterans Affairs, Office of Inspector General and the Rockland Police Department.
Morrison was initially arrested Jan. 26, 2017, by Rockland police after an investigation that began in July 2016.
He had been under investigation with the Maine Attorney General’s Health Care Crimes Unit since 2010 for possible involvement with health care fraud at the inn.
According to the affidavit filed by the Rockland Police Department in Knox County Unified Court, the investigation began when Aimee Liberty, president of the Trade Winds Inn, met with Detective Sgt. Russell Thompson in July 2016 regarding financial discrepancies she discovered at the fitness center and spa.
Liberty had concerns with the financial status of the center when she had to make payroll for its employees from the hotel’s account instead of a separate account with the health center. She then discovered that for approximately the past 18 months, no cash deposits had been made from the use of the spa tanning equipment.
Additionally, Liberty discovered that the Department of Health and Human Services had been having hearings due to an audit conducted on the Trade Winds by the department’s Integrity Unit.
The department was seeking recoupment of approximately $123,000 from the Trade Winds. Documents from DHHS showed that Morrison was listed as the person representing the Trade Winds for the hearings to contest the improper billing from the physical therapy side of the health club that he managed, according to the police affidavit.
Liberty also found numerous transactions with Amazon on the Trade Winds business credit card from June 2014 through July 2016, of equipment purchases that exceeded what was needed for the cliental using the facility, according to the court documents. Morrison purchased personal items on the credit card which included youth sports gear, child related toys, furnishings and gift cards with Southwest Airlines.
The items that Morrison allegedly purchased on the business credit card totaled $19,125 and were delivered to his home address.
According to the affidavit, since 2010, the approximate loss to the health club and spa while Morrison was the supervisor, was approximately $128,000.
Morrison’s employment as the supervisor of the spa portion at the Trade Winds was terminated on Oct. 29, 2016, according to the affidavit.
Source: Penobscot Bay Pilot