Fraud of the Month: May 2019

Bribes grease large-living exec’s $1.3-billion Medicare gouging

Bills forged for skilled nursing, assisted living that patients didn’t even need

Tanned, obsessive and Ferrari-driving, Phil Esformes was a peak achiever as an insurance thief in South Florida. No small feat in a region that’s one of America’s largest hubs of large-dollar insurance scamming.

Running his healthcare empire with an iron fist, the wealthy Miami executive launched a $1.3-billion rifling of taxpayer-funded Medicare and Medicaid. It was one of the largest health-insurance crimes in U.S. history — all at taxpayer expense.

Esformes ran dozens of corrupt skilled-nursing and assisted-living facilities. He bribed doctors to admit patients to his facilities so he could keep the places humming at full capacity.

The operations were mostly super-charged assembly lines churning out bogus claims for services that patients neither needed nor often received. Many patients didn’t even qualify for the care. Others came out of hospital surgery or had mental illness. Medical records were altered or forged to create the illusion that patients needed and received care.

Patients endangered

Esformes spent his stolen taxpayer money for a sultan’s lifestyle of luxury cars, a $360,000 watch and a waterfront mansion with a basketball court. Even as his bank accounts fattened, many patients were endangered by substandard care in poor living conditions, the feds contended.

Esformes disguised the doctors’ cash bribes with code words such as “fettuccine.” He inflated Medicare and Medicaid bills to pay for the kickback money he paid.

Bribes worked both ways: Two licensed nurses lavishly paid Esformes to refer his patients to their own health facilities. Guillermo and Gabriel Delgado used the patients to swindle Medicare for bogus mental-health, prescription-drug and home-healthcare services.

The brothers delivered wads of bribe cash to Esformes. They also camouflaged kickbacks as payments for high-end escorts for Esformes, including travel and hotel expenses such as the Ritz Carlton in Orlando.

“We will continue the fight against such parasites,”said federal special agent Shimon Richmond.

Gabriel also was Esformes’ conduit for bribing a Florida state health administrator to give him advance notice of surprise visits to his facilities in Miami-Dade.

Cohorts betray Esformes

The dirty money bought no loyalty. Gabriel turned on Esformes when the health mogul suggested Gabriel kill himself instead of face federal charges. Ultimately, the brothers secretly recorded hours of conversations for the feds to try and earn lenient jail terms for themselves.

Esformes also bribed the basketball coach at the exclusive University of Pennsylvania about $300,000 to get his son Morris into the Ivy League academic powerhouse. The coach placed Morris on a priority admission list as a recruited basketball player. The kid wasn’t Division I basketball caliber. Penn accepted him anyway, believing he was an elite player.

Esformes was convicted of 20 criminal counts. The charges add up to potentially 250 years in federal prison. He’ll be sentenced later.

“Even beyond the vital dollars lost though, Esformes exploited and victimized patients by providing inadequate medical care and poor conditions in his nursing homes …” said federal special agent Shimon Richmond. “We will continue the fight against such parasites.”


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