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Wheeling Woman Indicted For Falsifying Medical Records

Jeanette Shin of Wheeling and Paul Madison of Chicago were indicted Thursday by a federal grand jury for a health insurance false billing scheme, according to a Justice Department press release.

Paul Madison, of Chicago, owner of a North Michigan Avenue surgical center, was indicted Thursday on federal charges for allegedly submitting $3.5 million worth of false medical bills to 10 private health insurance companies and the federal workers’ compensation program, a recent Justice Department press release announced.

Jeanette Shin, of Wheeling, was a nurse at the facility, according to the release. She was indicted on charges of falsifying patients’ medical records, "claiming that chiropractors who brought patients to the clinic had performed certain procedures that, in fact, were not performed," the press release says. 

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Madison, 59 an anesthesiologist and pain management specialist, was the owner of Watertower SurgiCenter LLC, an outpatient facility located at 845 N. Michigan Ave., the release says. He was charged with six counts of health care fraud, three counts of making false statements in operative reports and two counts of aggravated identity theft in a 14-count indictment that was returned Thursday by a federal grand jury, according to the Justice Department press release. 

Shin, 67, was charged in the same indictment with three counts of making false statements in medical reports, the release says. Both defendants will be ordered to appear for an arraignment at a later date in U.S. District Court.

According to the indictment, between August 2005 and December 2009, Madison directed the company's billing staff to submit false bills to insurers for manipulation-under-anesthesia (MUA) treatments that chiropractors had not performed, according to the release.

Madison disguised the company's fraudulent billing scheme by creating false medical and billing records, and by directing his staff to do the same, the release says. Shin allegedly falsified her nurse’s reports by fraudulently claiming that chiropractors had performed certain MUAs that she knew they had not actually performed, according to the Justice Department press release.

The surgery center's owner allegedly billed more than $3,585,000 for unperformed medical services to insurance companies Aetna, Inc., Anthem Blue Cross Blue Shield, Blue Cross Blue Shield of Illinois, Esis Insurance Co., the Hartford Insurance Co., Humana, Ingenix, Liberty Mutual, Oriska Insurance and Sentinel, along with U.S. Department of Labor’s Office of Workers’ Compensation Programs, the release says. "The insurers collectively lost more than $783,000 as a result of the fraud scheme," according to the press release.

The Illinois Department of Financial and Professional Regulation investigated Watertower’s billing practices in the spring of 2007, and Madison allegedly responded by ordering company staff to replace and destroy accurate medical records with fraudulent records, according to the release. He further ordered billing staff to lie to investigators about the company's billing practices, the press release says.  

The aggravated identity theft charges accuse Madison of illegally using patients’ personal information in relation to acts of health care fraud, according to the Justice Department release.      

The indictment seeks forfeiture of more than $783,000, and if funds are not available, the government seeks forfeiture of substitute assets, including Madison’s 1978 Rolls Royce Corniche, a 2004 Porsche Caynee, a 2003 Toyota Sequoia, Shin’s home in Wheeling and a 2008 Jeep Grand Cherokee, according to the release.      

Each count of health care fraud carries a maximum penalty of 10 years in prison and a $250,000 fine, or an alternate fine totaling twice the loss or twice the gain, whichever is greater. Making false statements in medical reports carries a maximum penalty of five years in prison and a $250,000 fine on each count, and aggravated identity theft carries a mandatory consecutive sentence of two years on and a $250,000 fine on each count.

An indictment contains merely charges and is not evidence of guilt.  The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

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