Firm scammed US by using dementia patients

Federal authorities charged the nation's largest chain of community mental health centers Thursday with Medicare fraud, alleging the Miami-based company preyed on patients with severe dementia to bill $200 million for services it never delivered. Prosecutors allege that American Therapeutic Corp. and its sister companies faked medication and care charts and paid the owners of assisted living facilities and halfway houses to bring patients to their seven mental health centers in south and central Florida for therapy sessions that were never held.

Some patients also cashed in on the scheme by providing their Medicare numbers, while others were "not coherent enough" to demand kickbacks, according to the investigation by the departments of Justice and Health and Human Services. The alleged scam is "unlike anything we've seen before in terms of the nature and size of the scheme," said Assistant Attorney General Lanny Breuer.

Federal authorities arrested four of the company's owners and top managers Thursday and served search warrants at several of the centers. The grand jury indictment alleges that ATC routinely billed Medicare for therapy and other services for patients suffering from Alzheimer's and severe dementia even though they weren't eligible because their mental capacity was so impaired they couldn't benefit from therapy.