L.A. Clinic Operator Accused of Medi-Cal, Medicare Fraud

A Brentwood doctor who operated clinics in South-Central Los Angeles was arrested Tuesday on suspicion of defrauding the Medicare and Medi-Cal programs out of millions of dollars.

The U.S. attorney’s office in Los Angeles said Keith O’Neil Perry, 43, was named in a 41-count indictment returned last week by a federal grand jury.

Perry, a Medicare and Medi-Cal provider for more than a decade, is accused in the indictment of making false statements to government agencies, conspiring to receive and pay kickbacks for Medicare referrals, mail fraud, wire fraud, bankruptcy fraud, tax evasion, and defrauding a receiver who had been appointed by a court to enforce an $83,000 judgment against him.

Perry could not immediately be reached for comment.

Investigators said Perry has been engaging in fraudulent activities since 1992, when he was temporarily barred from participation in the Medi-Cal program because of an investigation into his billing practices.

Thom Mrozek, a spokesman for the U.S. attorney’s office, said that some of the charges of mail fraud and making false statements stem from a scheme through which Perry deceived the Medicare and Medi-Cal programs by billing under one name while actually operating under another.

In his efforts to defraud the court-appointed receiver, Perry used mail drops and hidden bank accounts to conceal his assets, officials said.

Investigators said Perry and two men who operated a home health care agency--John Watts and Perry Woods--operated a kickback scheme in which the pair paid him about $100 in cash for each patient he referred to them.

Watts and Woods have pleaded guilty in the case and are cooperating with prosecutors, the U.S. attorney’s office said.

The wire fraud counts stem from a scheme in which Perry defrauded Medicare by signing certificates falsely indicating that certain patients needed pumps to treat a rare medical disease--lymphedema--when the pumps were not needed, Mrozek said.

The bankruptcy fraud counts accuse Perry of making false statements in connection with a Chapter 11 petition he filed in 1996. According to prosecutors, Perry said he claimed to have filed only two previous bankruptcy petitions, when, in fact, he had filed five. The tax evasion counts stem from an attempt to avoid payment of federal employment taxes from 1991 through 1933, investigators said.

Personnel from the FBI, the Internal Revenue Service, the U.S. Postal Service, the federal Department of Health and Human Services and the state Bureau of Medi-Cal Fraud cooperated in the investigation, Mrozek said.