Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Look up keyword
Like this
6Activity
0 of .
Results for:
No results containing your search query
P. 1
Howard Katz Court Documents

Howard Katz Court Documents

Ratings: (0)|Views: 2,554 |Likes:
Published by sharesleuthdocs

More info:

Published by: sharesleuthdocs on May 07, 2010
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

07/10/2013

pdf

text

original

 
~
 
eN
i
")J
.
,i.
rI.
UNITED STATES
DISTRICT
COURTDISTRICT
OF
NEW
HAMPsmRF;
..
J'
'i
I
; . ~ ,
 
-"
L"U"
Lee
lOp
~
 
i,:
Ii
")
UNITED STATES
OF
AMERICA
)
)
CRIMINAL
NO.:
()
t -
C,e.
-
ulS:
9
-
d
/-4.
fY}
v.
)
)
HOWARD KATZ,
)
)
18
U.S.C.
§
1347
Defendant.
)
Health
Care
Fraud
INFORMATION
SEALED
DOCUMENT
The United States Attorney charges:I, At all relevant times, HOWARD KATZ ("KATZ") was a resident
of
Florida andthe
Chief
Executive Officer and Chainnan
of
the Board
of
Directors ofMDwerks, Inc,("MDwerks"), a company engaged
in
the business
of
offering electronic medical claimsprocessing, claims management, and col1ections solutions for health care providers, MDwerksdid business through three wholly-owned subsidiaries, Xeni Financial Services,
Inc"
XeniMedical Billing Corp. and Xeni Medical Services, Inc. (MDwerks and its subsidiaries arehereafter referred to col1ectively as the "Katz Companies").
2.
In October 2007, the Katz Companies entered into a contract with Ortho SupplyManagement, Inc, ("OSMI"), a Massachusetts company, in which the Katz Companies agreedto accept the assignment
of
insurance claims for transderrnal cream compounds dispensed toCalifornia workers compensation patients by physicians. OSMI originally purchased theseclaims from a California medical claims factoring company ("Factoring Company"). FactoringCompany, in
turn,
represented to OSMI that it had purchased these claims from the dispensingphysicians and that all the claims sold by Factoring Company involved an actual dispensing
of
acream compound by a physician.
Case 1:08-cr-00159-SM Document 1 Filed 12/10/08 Page 1 of 4
 
3. Pursuant to the Katz Companies' contractual relationship with OSMI, the KatzCompanies processed the assigned claims by submitting the claims for payment to numeroushealth care benefit programs, including private health insurance companies, the State
of
California Insurance Fund, and the United States Department
of
Labor. The Katz Companiesthen paid the amount collected on these claims from the health care benefit programs to OSMI,minus a processing fee.
4.
On or about March
II,
2008, several months after the Katz Companies assumedresponsibility for the claims that OSM[ bought from Factoring Company, the Katz Companiespurchased similar claims directly from Factoring Company. To fund this purchase
of
claimsfrom Factoring Company, on
or
about March 31,2008, the Katz Companies receivedapproximately $6.8 million from a hedge fund operating in
New
York and Florida. In exchangefor this funding and other additional debt that the Katz Companies already owed the hedge fund,the Katz companies gave a $10 million Note to the hedge fund. It was KATZ's intention to useproceeds from the collection
of
the claims purchased from Factoring Company to resolve thedebt to the hedge fund.
5.
To assist the Katz Companies in billing the health care benefit programs for theclaims that it owned and that OSMI assigned to it, the Katz Companies engaged a NewHampshire company with expertise in health care billing (hereafter "Billing Agency"). BillingAgency submitted the claims to health care benefit programs, and the Katz Companies paidBilling Agency a percentage
of
the amount collected.
6.
[n the summer
of
2008, Billing Agency identified various problemswith the claims that were being submitted for payment to health care benefit programs
on
behalf
of
the Katz Companies. These problems included the discovery that billings were being
2
Case 1:08-cr-00159-SM Document 1 Filed 12/10/08 Page 2 of 4
 
submitted for creams purportedly dispensed to a patient who was deceased on the purporteddates
of
service.
7.
In
or
about August 2008, Billing Agency informed KATZ by telephone that thereappeared to be substantial problems with the claims. KATZ later traveled to
New
Hampshire fora meeting regarding the claims, at which time Billing Agency explained to KATZ the basis forits concern. At the meeting, KATZ stated that he would investigate the situation further, but thatpending the result
of
the investigation, claims should continue to be submitted withoutinterruption.
8.
As a result
of
KATZ's investigation and other information that KATZreceived, by no later than September
15,
2008, KATZ knew that the claims OSMI had assignedto the Katz Companies, and also the claims that the Katz Companies had purchased directly fromFactoring Company, were largely fraudulent
in
that the claims involved erroneous dates
of
service and, in many cases, were based on services that
had
not in fact been rendered. Despiteknowing the fraudulent nature
of
the claims, KATZ continued to cause claims to be submitted tohealth care benefit programs for payment until on or about September 23, 2008.9. After September 23, 2008, KATZ continued to develop fraudulent methods bywhich the Katz Companies could collect
on
the claims.
In
furtherance
of
this goal, KATZ madefour payments to Billing Agency totaling $146,847.50 to pay for related costs and expenses.
3
Case 1:08-cr-00159-SM Document 1 Filed 12/10/08 Page 3 of 4

Activity (6)

You've already reviewed this. Edit your review.
1 hundred reads
1 thousand reads
rockspaperx4777 liked this
elvis_bayang1 liked this

You're Reading a Free Preview

Download
scribd
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->