HUSBAND AND WIFE TO PLEAD TO MEDICARE FRAUD

BIRMINGHAM, AL - United States Attorney Alice H. Martin today announced that  WILLIAM LLOYD KING, JR., 63, and MARIE WELLER KING, 62, both of Birmingham, have each agreed to plead guilty by Informations to a federal crime involving Medicare Fraud.

MARIE WELLER KING, a registered nurse, managed, directed, and operated King & Associates, Inc. which was in the business of providing consulting services to skilled nursing facilities in Alabama and other states.  WILLIAM LLOYD KING, JR., an accountant, managed, directed, and operated Southern Care, Inc. d/b/a King and Associates.  Southern Care, Inc. was engaged in the business of preparing Medicare cost reports for skilled nursing facilities including some of the skilled nursing facilities which used the services provided by King & Associates, Inc.

“The King’s manipulated skilled nursing facilities and the Medicare reimbursement system for personal gain” stated U.S. Attorney Martin.  “Schemes to defraud the United States at the expense of our taxpayers will  be rooted out, and we thank private citizens who file qui tam suits to assist the United States in uncovering sophisticated fraudulent schemes.”

Medicare guidelines state that only payments made to physicians for their services on utilization review (“UR”) committees are allowable as costs on a cost report for a skilled nursing facility. Accordingly, only payments made to physicians for their services on UR committees are allowable as costs.  Non-physician compensation associated with UR services are allowable only as part of the administrative costs of the skilled nursing facility and must be allocated as such.   

From approximately January 2002 until approximately December 2006, WILLIAM KING and MARIE KING (husband and wife) devised a scheme which resulted in certain skilled nursing facilities submitting false cost reports to Medicare.  These cost reports contained inflated physicians costs for UR services in order to obtain greater Medicare reimbursements.

WILLIAM KING has agreed to plead guilty to one count of conspiracy.  MARIE KING has agreed to plead guilty to one count of making false statements with respect to a health care fraud matter.  Both WILLIAM KING  and MARIE KING have agreed to forfeit at least $724,087.00, such funds representing the amount which Medicare overpaid for fraudulent UR services.  The skilled nursing facilities are not charged with any criminal conduct.

This matter was brought to the attention of the United States through the filing of a qui tam complaint by an accountant who worked for a company which prepared cost reports for the skilled nursing facilities after WILLIAM KING sold Southern Care, Inc.  In April 2008, the United States intervened in that civil action with respect to WILLIAM KING, MARIE KING, King & Associates, Inc. and Southern Care, Inc.  That action is currently pending in the United States District Court for Northern District of Alabama and designated as Case Number CV 06-P-4645-S.

“The HHS-OIG is committed to protecting the Medicare Trust Fund and its beneficiaries. We will continue working with DOJ and other law enforcement partners to identify anyone who deliberately manipulates the system to defraud the Medicare program” stated Melody Jackson, Special Agent in Charge for the U.S. Department of Health and Human Services - Office of the Inspector General.

        “Health care fraud puts the health and finances of all Americans at risk.  This case demonstrates the FBI’s firm response to those who exploit the Medicare program for their own personal enrichment,” stated Carmen S. Adams, Special Agent in Charge, Federal Bureau of Investigation.

In addition to the forfeiture, the defendants each face maximum sentences of five years in prison and a fine of up to $250,000.00.  King & Associates, Inc. and Southern Care, Inc. are now defunct businesses.

The investigation of this matter was conducted by investigators from the Department of Health and Human Services’ Office of the Inspector General and the Federal Bureau of Investigation.  Assistant United States Attorney Lloyd Peeples is prosecuting the matter on behalf of the U.S. Government.

The public is encouraged to contact law enforcement if they have information regarding health care fraud.