WASHINGTON – An owner of two Houston health care companies pleaded
guilty yesterday in connection with schemes to defraud Medicare of $6.3
million, announced the Departments of Justice and Health and Human
Services (HHS).

Princewill Njoku, 51, pleaded guilty before U.S. District Court Judge
Gray Miller in Houston to conspiracy to commit health care fraud. In
his plea, Njoku admitted that he defrauded Medicare of $6.3 million.

According to court documents, Njoku

was an owner of Family Healthcare Services (Family Services). Family
Services maintained a valid Medicare provider number in order to submit
Medicare claims for the costs of durable medical equipment (DME) and
purported to provide orthotics and other DME to Medicare beneficiaries.
According to court documents, Njoku and co-defendant Clifford Ubani
hired co-conspirators to recruit Medicare beneficiaries for the
purposes of filing claims with Medicare for DME. Once Njoku and Ubani
obtained Medicare beneficiary numbers, Family Services submitted claims
to Medicare for DME, including orthotic devices, which were medically
unnecessary and/or not provided. Many of the orthotic devices were
components of what was referred to as an “arthritis kit,” and purported
to be for the treatment of arthritis-related conditions, although they
were not medically necessary or appropriate for such conditions. The
arthritis kit generally contained a number of orthotic devices
including braces for both sides of the body and related accessories
such as heat pads. Njoku admitted that he paid kickbacks to the
recruiters for their referrals. In total, Family Services submitted
approximately $1.1 million in fraudulent claims to Medicare.

Additionally, Njoku was an owner and operator of Family Healthcare
Group (Family Group), a home health care company. Family Group
purported to provide skilled nursing to Medicare beneficiaries.
According to court documents, Njoku hired co-conspirators to recruit
Medicare beneficiaries for the purposes of filing claims with Medicare
for skilled nursing. Family Group then used the Medicare beneficiary
numbers to submit claims to Medicare for skilled nursing that was
medically unnecessary and/or not provided. Njoku admitted that he paid
kickbacks to the recruiters for their referrals. In total, Family Group
was paid approximately $5.2 million by Medicare for the submission of
fraudulent claims.

At sentencing, Njoku faces a maximum sentence of 10 years in prison.
Ubani, Njoku’s business partner and co-owner of Family Services and
Family Group, pleaded guilty on Sept. 29, 2010, to conspiracy to commit
health care fraud. Ubani and Njoku are scheduled to be sentenced on
Feb. 25, 2011.

Yesterday’s guilty plea was announced by Assistant Attorney General Lanny
A. Breuer of the Criminal Division; U.S. Attorney José Angel Moreno of
the Southern District of Texas; Special Agent-in-Charge Richard C.
Powers of the FBI’s Houston Field Office; Special Agent-in-Charge Mike
Fields of the Dallas Regional Office of HHS Office of Inspector General
(HHS-OIG), Office of Investigations; and Texas Attorney General Greg
Abbott.

This case is being prosecuted by Trial Attorneys Charles D. Reed and
Sam S. Sheldon of the Criminal Division’s Fraud Section. The case was
brought as part of the Medicare Fraud Strike Force, supervised by the
U.S. Attorney’s Office for the Southern District of Texas and the
Criminal Division’s Fraud Section.

Since their inception in March 2007, Medicare Fraud Strike Force
operations in seven districts have obtained indictments of more than
810 individuals who collectively have falsely billed the Medicare
program for more than $1.85 billion. In addition, HHS’s Centers for
Medicare and Medicaid Services, working in conjunction with the
HHS-OIG, are taking steps to increase accountability and decrease the
presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

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