Hospice director, also the town mayor, charged in $150M federal fraud case

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Texas hospice head indicted on healthcare fraud
Texas hospice head indicted on healthcare fraud

A Texas mayor and three others were indicted Wednesday for their alleged roles in a $150 million healthcare fraud and money laundering scheme, prosecutors said.

Francisco Pena, medical director for a group of hospice and home healthcare affiliates, was among four charged in the 11-count indictment filed in the Southern District of Texas, prosecutors said. Pena, 82, is also mayor of Rio Bravo, TX.

The U.S. Department of Justice claims Pena's organization, Merida Health Care Group, billed for unneeded services and sometimes kept patients in hospice care for years to collect more money.

Federal officials charge that starting in 2009 and through the indictment's filing date, owner Rodney Mesquias of San Antonio and managers Henry McInnis and Jose Garza, both of Harlingen, TX,  conspired to defraud Medicare via kickbacks and bribes. By certifying patients qualified for services and referring them, the men increased Medicare revenue and laundered their profits, authorities said.

Pena was one of three defendants also charged with counts relating to obstructing justice and providing false statements. Prosecutors detailed an investigation into shady practices using a criminal informant who paid Pena $5,000 in cash for illegal referrals.

The indictment reports Pena allegedly told a witness that, “the way you make money is by keeping them (hospice patients) alive as long as possible.”