United States v. Delgado, 10–50726.

• Decision Date: 19 January 2012
• Docket Number: No. 10–50726.,10–50726.
• Citation: 668 F.3d 219
• Parties: UNITED STATES of America, Plaintiff–Appellee, v. Sylvia DELGADO, Defendant–Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

668 F.3d 219

UNITED STATES of America, Plaintiff–Appellee,

v.Sylvia DELGADO, Defendant–Appellant.

No. 10–50726.

United States Court of Appeals, Fifth Circuit.

Jan. 19, 2012.

Joseph H. Gay, Jr., Asst. U.S. Atty. Kimberly Marie Johnson, Sp. Asst. U.S. Atty. (argued), San Antonio, TX, for Plaintiff–Appellee.

Kimberly S. Keller, Shane John Stolarczyk (argued), Keller Stolarczyk, P.L.L.C., Boerne, TX, John F. Carroll, San Antonio, TX, for Defendant–Appellant.

Appeal from the United States District Court for the Western District of Texas.

Before JONES, Chief Judge, and DAVIS and DeMOSS, Circuit Judges.

EDITH H. JONES, Chief Judge:

Sylvia Delgado was convicted by a jury of defrauding Medicaid and Medicare of $1.4 million. Delgado appeals her conviction, arguing that the evidence was insufficient; prejudicial evidence was admitted; the jury instructions were flawed; her sentencing level was erroneously increased for obstruction of justice; and the district court erred by denying Delgado's request for post-trial contact with a juror. Because there is sufficient evidence to support the conviction and no reversible error, we AFFIRM.

BACKGROUND

Delgado, a self professed medical billing expert with thirty years of experience in medical coding and billing, owned a billing company called Med Comp Electronic Billing. In 1992, Delgado started doing billing and record work for Dr. Rafael Solis, a psychiatrist. In 2002, Delgado was approached by a Licensed Master Social Worker (“LMSW”) named Robert Rael (“Rael”) with a business idea of providing group psychotherapy counseling to the elderly. Rael's idea consisted of having a psychiatrist refer patients to Rael for group psychotherapy sessions. Delgado agreed to approach Dr. Solis with the idea, and the three formed Synergy in early 2002.

Dr. Solis, as a licensed psychiatrist, was the medical director of Synergy. He performed initial evaluations of patients, prescribed medication, and conducted individual counseling sessions. Dr. Solis referred the patients to Synergy for group psychotherapy, which was billed under his Medicaid and Medicare numbers even though he did not conduct or supervise the group sessions. Rael agreed to conduct the group therapy sessions using Dr. Solis's billing numbers because Rael was not authorized under Texas law to have his own billing numbers. Delgado performed all of the billing and split Synergy's Medicaid and Medicare billing proceeds with Rael. Rael received seventy percent of the proceeds and paid for operating expenses. Delgado received thirty percent of the proceeds. Dr. Solis was initially not paid by Synergy, but starting in January 2005, Synergy paid him $2,000 per month. Medicare and Medicaid paid $1.4 million for therapy conducted at Synergy from 2002 until 2005. In just over three years, Rael profited $508,953.10 and Delgado profited $388,059.20 from Medicaid and Medicare.

The “therapy” conducted at Synergy was ineligible for the Medicaid and Medicare payments that Rael and Delgado received. While group psychotherapy can be billed to these programs, the sessions must meet stringent requirements. Multiple sessions for one patient in one day are usually prohibited. Consequently, Medicaid and Medicare billing systems automatically reject more than one group therapy code, 90853, per day per patient. Delgado, through research and talking to other billing practitioners, learned how to circumvent this system using a modifier in conjunction with the billing code. After discovering this modifier, Delgado billed up to six group therapy sessions per day per patient. Medicare's program integrity contractor flagged Dr. Solis because his office billed the group therapy code 17,000 times in one year compared to his peer group's average of 500 claims.

Federal regulations also require that group psychotherapy be conducted by a state licensed psychiatrist, psychologist, or qualified mental health professional. Rael, as a LMSW, is unqualified to conduct therapy sessions in Texas without supervision, and there is evidence that Delgado was told that Rael was not authorized to conduct these therapy sessions. Non-physician providers can conduct therapy “incident to” treatment provided by a physician if the following supervision requirements are met: the doctor must be actively involved in the patients' care, the doctor must be on the premises, and the doctor must be available to assist the patients during treatment. Dr. Solis admitted to investigators that he did not supervise the therapy at Synergy. Indeed, Dr. Solis worked most of the time at his office in San Antonio,¹ for the Social Security Administration, the Texas Rehabilitation Center, and the GEO prison center.

In reality, Rael was not even conducting most of the therapy but instead spent seventy-five percent of the “therapy” time alone in his office. Robert Martinez, who has a sixth grade education, conducted most of the sessions. Martinez picked up the patients around 12:30 p.m. on weekdays and brought them to Synergy, where they would sign an attendance log, watch television, talk to each other, and eat doughnuts for the first hour. The “therapy” consisted of watching television, eating meals, socializing, being read to, playing loteria, and celebrating birthdays. For these activities, Delgado billed Medicaid and Medicare up to six group psychotherapy sessions per day per patient. Unsurprisingly, the regulations prohibit describing the following as group therapy: social activities, socialization, music therapy, recreational activities, art classes, excursions, cognitive stimulation, motion therapy, and eating together. What Synergy did is billable to the programs, if at all, as adult day care, which is reimbursed at a much lower rate and for no more than two units per day. Synergy did not even qualify for adult day care, however because it failed to furnish nursing staff, personal care services, and physical therapy services.

Delgado was frequently present at the Synergy office during this “therapy.” Initially, Delgado occupied an office in the same suite as Synergy. She moved two doors down to another suite of offices as Synergy expanded but continued to visit the Synergy to collect sign in sheets, talk to Rael, and attend birthday parties. When Dr. Solis was in town, Delgado escorted patients to Dr. Solis's office for individual counseling. Despite her proximity and frequent visits to Synergy, she billed for group psychotherapy when both Rael and Dr. Solis were out of town or out of state and even on a holiday. Delgado's involvement with Synergy was not limited to her visits and the billing. She was a founder of the company, received thirty percent of the billing proceeds, and exerted influence over the operation of Synergy when she forced Rael to fire an employee.

In May 2005, Medicare's integrity contractor, Tri–Centurion, began investigating Synergy's billing practices. In response, Rael, Dr. Solis, and Delgado consulted a lawyer and sent a statement to the investigators that Dr. Solis supervised all of the sessions and the group therapy was legitimate. Delgado and Rael also arranged to have the patients submit, as affidavits, their handwritten copies of a statement that Delgado wrote. A witness testified that she helped Delgado change words in some of the statements so they would not all be exactly the same but would all still claim that Rael conducted legitimate group psychotherapy sessions. After these affidavits were submitted, a criminal investigation began. When Delgado knew federal investigators were going to interview Dr. Solis, she advised him: “[p]lease do not give them too much information only whatever questions they might want answered as you already know.” After Rael's arrest, Delgado tried to get a message to Rael through a relative telling him to “stick to their stories.”

Based on the investigation, a grand jury returned a ten-count indictment against Delgado.² A jury found Delgado guilty on all counts. She was sentenced to 51 months in prison and ordered to pay $1,411,203.08 in restitution. Delgado's prison sentence included a two-step increase for obstruction of justice because of Delgado's improper contact with a juror. Delgado appeals her conviction and sentence.

DISCUSSION

A. Sufficiency of the Evidence

Delgado argues that there is insufficient evidence to support her conviction for health care fraud, conspiracy, and making false statements. When reviewing jury verdicts, “the standard of review is whether, after viewing all the evidence and inference that may be drawn therefrom in the light most favorable to the verdict, any rational trier of fact could have found the essential elements of the offense beyond a reasonable doubt.” United States v. Stephens, 571 F.3d 401, 404 (5th Cir.2009) (citing United States v. Holmes, 406 F.3d 337, 351 (5th Cir.2005)). “The jury is free to choose among reasonable constructions of the evidence and the evidence need not exclude every reasonable hypothesis of innocence or be wholly inconsistent with every conclusion except that of guilt.” United States v. Ferguson, 211 F.3d 878, 882 (5th Cir.2000). After reviewing the evidence, we find the evidence sufficient to support the conviction.

1. Fraud and Making False Statements³

Delgado contends that the evidence was insufficient to establish that she knew the therapy she was billing for was fraudulent. Thus, she could not have had the requisite mens rea to commit fraud or make false statements. We disagree.

First, because of her ownership and involvement in Synergy and her schedule-keeping for Dr. Solis, Delgado knew he could not be conducting or personally supervising the therapy. Second, there was abundant evidence of Delgado's knowledge that “therapy” at Synergy was nothing more than adult day care conducted by a man with a sixth grade education. Third, knowing that the Medicaid and Medicare billing systems would reject more than one group psychotherapy session per day,...