Keith Canlapan, a licensed occupational therapist, pleaded guilty in Los Angeles to one count of conspiracy to commit health care fraud on October 24, 2016.  His sentencing is scheduled for February 16, 2017.  Canlapan admitted that during his employment with JH Physical Therapy in Walnut, California he billed Medicare for occupational therapy services when no such services were provided.  Instead of performing the approved occupational therapy services that he represented to Medicare were provided, Medicare beneficiaries received massage and acupuncture services, which are not reimbursable under Medicare rules.  Canlapan further admitted that he was not even present at JH Physical Therapy on dates that he represented to Medicare that he provided occupational therapy services, instead he was either out of the country or at other places of employment.

Between approximately October 2009 and approximately December 2012, Canlapan, through JH Physical Therapy, billed Medicare $2,669,618 in false and fraudulent claims, of which Medicare paid $1,860,786.  Canlapan was charged along with co-defendants Simon Hong, 54, and Grace Hong, 50, husband and wife, both of Brea, California.  Simon Hong is the owner and Grace Hong is the co-operator of JH Physical Therapy, and they are charged with one count of conspiracy to commit health care fraud and three counts of health care fraud.  Both are pending trial, which is scheduled for Jan. 17, 2017.  Co-conspirator Roderick Belmonte Concepcion, a licensed occupational therapist, was also previously indicted in a separate related case and pleaded guilty in April 2016.  His sentencing is scheduled for Jan. 23, 2017.

Canlapan’s guilty plea demonstrates the willingness of federal prosecutors to indict and convict therapists and other providers that use their credentials to fraudulently bill Medicare.  The cases against Canlapan and his co-conspirators are criminal cases.  However, under the qui tam provisions of the False Claims Act, whistleblowers with information about similar fraud against the government may bring a civil case on behalf of the United States. If successful, the government can recover three times the amount the defendants fraudulently billed the government as well as monetary penalties for each false claim submitted.  The whistleblower, who originally filed the case, is entitled to 15-30% of the government’s recovery and their attorney’s fees.