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Medicaid fraud case involving McAllen supplier underway

McALLEN — Prosecutor Michael Edward Day stood before a federal jury Tuesday to deliver his opening statement in a case connected to the largest healthcare fraud takedown in U.S. history, and repeated an ominous saying three times in Spanish.

“ Desde cuando los patos le tiran a las escopetas?” Day said, repeating the alleged threat Maria Teresa Paz Garza would often make to her employees. “Since when do the ducks shoot at the shotguns?”

Paz, 41, was the co-owner of Hacienda DME, a McAllen medical supplies company accused of submitting more than $2.5 million in false claims to Medicaid between 2008 and 2013. The company appears to now be closed with the listed phone number disconnected.

Paz was arrested along with six of her employees in June 2016 and faces 18 charges, including five counts of healthcare fraud and two counts of tampering with witnesses after allegedly making death threats to her employees and a police sergeant involved in the case.

“After getting charged and arrested, she threatened to kill Sgt. Garcia,” Day said to the jury. “She said the same to the others that were charged too.”

Paz’s defense attorney, Jaime Peña, accused prosecutors of being selective with their evidence and said this is one of the many “games” the government is playing to convince the jury of his client’s guilt. He accused the other defendants in the case of conspiring against Paz and for setting up and running the scheme that led to everyone’s arrest.

“The money went into their pockets, not Maria’s,” Peña said during opening statements. “They will be calling all of these witnesses to the stand but will leave out a key witness, a key witness that will say what as actually going on.”

Bertha Lopez, 61, of Sullivan City, served as a marketer and vendor for the company; Miriam Aguilar, 31, of Rio Grande City was a delivery driver and recruiter; Nancy Rangel, 30, of Mission, was a biller and recruiter. Veronica Cruz, 32, of Donna; Angelica Saenz, 44, of Mission; and Yolotzi Lara, 28, of Pe itas, were also charged for their roles as recruiters for Hacienda DME.

According to the indictment, some of the women were forging the signatures of physicians to order unnecessary or more expensive supplies, including training pants and diapers, regardless of whether they were needed. Instead of delivering them to Medicare recipients, they would restock them for resale in their store.

All six of the employees worked out a deal with the government in November and pleaded guilty to one count of attempt and conspiracy to commit mail fraud. All of their sentencing dates have been rescheduled until after the trial, according to court documents.

Day, the assistant district attorney representing the government in the case, said Paz created a culture of fraud and fear that led others in her company to branch out and commit their own fraud. He said Paz was at the center of it all, but worked to make sure it did not look that way on paper. He said Hacienda DME was under her husband’s name and made sure others would sign documents and place orders to conceal her role in the alleged scheme.

“She was at the center of the cover up,” Day said. “She told them to lie … she told them if investigators come, I am nobody.”

Paz and her employees were arrested as part of a nationwide takedown led by the Medicare Fraud Strike Force, where 301 individuals were arrested, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings in 36 federal districts.

In the Southern District of Texas, which spans from McAllen to Houston, the U.S. Attorney’s Office and the Department of Justice Medicare Fraud Strike Force charged 22 individuals in 11 cases involving over $136 million in alleged fraud. In a news release, Attorney General Loretta E. Lynch and Department of Health and Human Services Secretary Sylvia Mathews Burwell called it the largest national medical fraud takedown in history.

Paz’s trial is scheduled to continue Wednesday before U.S. District Judge Randy Crane.

Written by
Kristian Hernandez - The Monitor