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AIS's Health Business Daily
Featured Story June 11, 2008 After Fraud Conviction, Houston Physician Allegedly Plots Murder of Prosecutor and FBI AgentReprinted from REPORT ON MEDICARE COMPLIANCE, the nation's leading source of news and strategic information on false claims, overpayments, compliance programs, billing errors and other Medicare compliance issues. By Nina Youngstrom, Managing Editor, (nyoungstrom@aispub.com) The plea agreement in a Texas health fraud case reads like a Hollywood script, complete with a jailhouse conspiracy, a physician's plot for revenge and conversations taped by undercover FBI agents. A Houston physician already serving time for a health care fraud conviction was also given a 30-month prison sentence after pleading guilty to making threats against three people: his wife, the federal prosecutor who helped put him in jail and an FBI special agent, the U.S. Attorney's Office for the Western District of Texas said May 22. Ira Klein, M.D., then a Houston gastroenterologist, pleaded guilty to one count of threatening to murder a law enforcement officer. Klein wanted to retaliate against the three people for their participation in his health care fraud conviction, the feds say. While Klein was in jail during his trial for health fraud, he met with fellow inmates to discuss the alleged murder scheme, the feds say. He agreed to pay an inmate $550,000 to have the federal prosecutor run over by an 18-wheeler and "make him like a pancake," to have acid thrown in the FBI agent's face and to have his own wife shot because Klein "was convinced [she] helped authorities secure his conviction," the feds explain. Sheila Sawyer, a former federal prosecutor who is not involved in this case, says that "death threats against federal prosecutors are extremely rare." But as this case shows, the government takes threats against prosecutors and agents "very seriously," she says. The feds' probe into Klein's billing practices began in 2003, but Blue Cross and Blue Shield of Texas began its inquiry even earlier, in 2000, according to the plea agreement. The Texas Medical Board filed a complaint against him in 2004, alleging that he had committed health care fraud, and found that he was subject to disciplinary action, the agreement says. Klein surrendered his medical license in 2005. The feds indicted Klein in February 2006, charging him with 46 counts, including mail fraud and health care fraud. He surrendered to the FBI and was released on a $500,000 bond with his wife as co-signer. In March 2006, his wife said she wanted a divorce and told federal officials that she was concerned for her safety "due to…extremely aggressive behavior by Klein." She no longer wanted to be the co-signer on the bond, the plea agreement says. So the feds revoked the bond, and Klein was detained in a federal correction center pending his trial. While he was in custody, Klein spoke with inmates about being "upset" about his arrest and said his wife knew "a lot about [the] insurance fraud case" and wanted him in jail so she "could steal all of his money," according to the plea agreement. He also talked about having the prosecutor killed, but was worried about getting caught, the plea agreement says. He told an inmate to use one of the inmate's trucks to run over the prosecutor "to make it look like an accident so it would not get back to them. Klein told [the inmate] that if he did this he would never have to work again," the agreement adds. One of the inmates arranged for Klein to speak with a relative who could carry out the killings, but that relative was really an undercover FBI agent who tape-recorded the conversation, according to the feds. Klein Got 11-Year Prison Sentence After his fraud trial, Klein was sentenced in August 2007 to 11 years in jail for defrauding private health insurers of $10 million. He was also ordered to pay $11.5 million in restitution. Klein had specialized in treating patients who had hepatitis C. According to the feds, Klein billed insurance companies for services he did not provide and misrepresented other services. For example, the patients would self-administer medications at home, but Klein would bill the insurance companies as if he or his staff administered the injections at the office, the feds alleged. He billed for more than $16 million, the feds say. Klein required "patients to make weekly office visits to receive injections of medications to treat hepatitis C rather than providing a prescription to the patients to obtain the medications from a pharmacy to be self-administered," the indictment says. He also "routinely waived co-payments from patients even though they were financially able to make said co-payments in order to encourage the patient to continue to make office visits," it adds. Eighteen months of the 30-month sentence for the threat will be served concurrently with the health care fraud sentence, and 12 months will be served consecutively, so Klein will spend a total of 147 months in federal prison, the feds explain. He also agreed to a criminal forfeiture of $250,000. Klein's attorney, Scott Brazil, says Klein considered all of the evidence and the prosecutor's offer and decided to plead guilty to the charge of threatening to murder a law enforcement officer. Brazil tells RMC that Klein is appealing the health care fraud conviction. "We have always felt that this was a civil issue, not a criminal case. If this had been a civil matter, [Klein] would have explored all the avenues" and may have settled, he says. "I think physicians and other providers need to be very watchful when [health insurance] companies start calling in their favors in Washington because [providers] can get into trouble." Civil matters can turn into criminal matters very quickly, he adds. Sawyer, who is now with the law firm of Waller, Lansden, Dortch & Davis LLP in Nashville, says the physician's jail sentence for the plot to hurt the law enforcers and his wife shows how "your words can get you in trouble and result in significant jail time, whether you intended to carry out the threat or not." Ironically, she
says, when she was a prosecutor, she worried less about retaliation
from career criminals, who understood that she was just doing her job,
than from white-collar criminals, who felt they were being unfairly
persecuted.
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