USA v. Mateos

Decision Date19 October 2010
Docket NumberNo. 08-17178.,08-17178.
PartiesUNITED STATES of America, Plaintiff-Appellee, v. Sandra MATEOS, Ana Alvarez, Defendants-Appellants.
CourtU.S. Court of Appeals — Eleventh Circuit

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Joaquin Mendez, Jr. (Court-Appointed), Joaquin Mendez, P.A., Miami, FL, Arthur Joel Berger, Coral Gables, FL, for Defendants-Appellants.

Evelio J. Yera, Anne R. Schultz, Asst. U.S. Atty., Kathleen M. Salyer, Jonathan D. Colan, Miami, FL, for U.S.

Appeals from the United States District Court for the Southern District of Florida.

Before O'CONNOR, Associate Justice, * and CARNES and ANDERSON, Circuit Judges.

O'CONNOR, Associate Justice (Ret.):

Dr. Ana Alvarez and Nurse Sandra Mateos were employees at St. Jude Rehabilitation Center during its brief time as an operating clinic in 2003. St. Jude was ostensibly an HIV treatment center, but it was established as a front for a massive Medicare scam. The fraud involved falsely diagnosing patients with a condition that would justify treatments of WinRho, an expensive drug reimbursable by Medicare at a rate of about $4,900 per treatment to St. Jude. Because the treatment was medically unnecessary, employees at St. Jude would purchase only a small fraction of the drugs and drug treatments for which they billed Medicare. They would then use a simple saline solution or an extremely diluted dose of WinRho to inject patients, thereby pocketing much of the money that Medicare had paid for the WinRho treatments. All of the patients were HIV-positive Medicare beneficiaries who had been recruited for the purpose of seeking WinRho treatments they did not actually need. The patients were typically paid about $150 per visit in exchange for their knowing participation. During the approximately five-month span in which this scam continued, St. Jude received more than $8 million from Medicare.

For their roles in this operation, Dr. Alvarez and Nurse Mateos were indicted on several counts. Both Alvarez and Mateos were indicted for: (1) conspiracy to defraud the United States, to cause the submission of false claims, and to pay health care kickbacks, in violation of 18 U.S.C. § 371; and (2) conspiracy to commit health care fraud, in violation of 18 U.S.C. §§ 1347 and 1349. While Mateos was charged with only those two counts, Alvarez faced three additional counts of (3-5) submission of false claims, in violation of 18 U.S.C. § 287. Mateos was convicted of both counts, and Alvarez was convicted of all five of her counts. Mateos was sentenced to 7 years' imprisonment, and Alvarez to 30 years' imprisonment.

On appeal, Alvarez and Mateos each raise various arguments challenging their convictions and sentences. We reject all but one of their arguments outright. The one meritorious argument is raised by Alvarez, who correctly contends that the district court improperly excluded a videotape containing exculpatory evidence. The surreptitious recording, made near the tail end of the clinic's operation, arguably showed coconspirators assuring Alvarez that there was no fraudulent scheme at St. Jude. We agree with Alvarez that the statement at issue in the tape was potentially powerful exculpatory evidence because a conspirator's denial of the existence of Medicare fraud to Alvarez is certainly in tension with the theory that Alvarez was privy to the scheme. We also agree with Alvarez that the statement was not hearsay, contrary to the district court's ruling, because it was not being offered for the truth of the matter asserted. See Fed.R.Evid. 801(c) (“ ‘Hearsay’ is a statement ... offered in evidence to prove the truth of the matter asserted.”). That is, Alvarez was not seeking to prove through the statement that there was no fraud at St. Jude-a point that was repeatedly conceded during her own testimony-but that the behavior of concealing the scheme from her was inconsistent with the prosecution's theory that she had knowledge of the scam.

Nonetheless, the exclusion of this videotape was harmless error because it was duplicative of witness testimony discussing the exculpatory content of the videotape. Indeed, Alvarez's attorney stressed this testimony in his closing argument.

Because this lone error was harmless, we Affirm the convictions and sentences of both Alvarez and Mateos.

I

The fraud at St. Jude involved an extensive cast of characters. Aisa Perera and Mariela Rodriguez (M. Rodriguez) were the catalysts behind St. Jude's creation. Perera approached M. Rodriguez in 2002 with an opportunity to work with her in starting up a new health care clinic. The two eventually decided the clinic should target Medicare patients. Perera then met with Rita Campos, who owned a medical billing company, to discuss the endeavor. Campos told her that Luis Benitez would be able to provide her with everything she needed to start a lucrative clinic treating HIV-positive patients. Perera then met with Benitez, and, as Campos indicated, he provided the money and personnel necessary to start the clinic.

St. Jude was one of eleven clinics funded and established by Luis Benitez and his brothers Carlos and Jose Benitez. They started their clinics for the purpose of committing Medicare fraud. Luis Benitez provided the start-up capital, nurses, and supplies, and he sent an individual named Thomas McKenzie to train St. Jude's medical personnel. McKenzie had trained the staff at many of the Benitez brothers' clinics. He had a medical degree from Guatemala but was not licensed to practice medicine in the United States. He instructed St. Jude's two doctors as to how they should document their patients' charts so that Medicare would pay for WinRho treatments. WinRho is generally used to treat HIV patients suffering from thrombocytopenia or idiopathic thrombocytopenic purpura (ITP), a condition marked by an abnormally low platelet count. Before St. Jude began operating, McKenzie instructed the clinic's medical staff that the objective in filling out patient charts was to make the patient files compatible with a diagnosis of thrombocytopenia, and that bleeding disorders would justify the diagnosis even though a laboratory test would be necessary to confirm the condition.

The clinic employed two licensed doctors, Dr. Orestes Alvarez-Jacinto and his daughter, Appellant Ana Alvarez. During their careers, Alvarez-Jacinto specialized in gynecology, and Alvarez's field of expertise was endocrinology and internal medicine. Neither had significant experience treating HIV patients. McKenzie trained each of them to note bleeding disorders on their patients' charts so as to justify WinRho treatments.

Alvarez-Jacinto and Alvarez began seeing patients on the day that St. Jude opened. All of the patients were HIV-positive Medicare beneficiaries, but they were not seeking treatment in earnest; they, too, were in on the scam. The Benitez brothers recruited them to seek treatment at St. Jude, provided transportation to the clinic for those who needed it, and paid the patients kickbacks ranging from $150 to $300 per visit. While the patients were apparently coached to make generic complaints about bleeding disorders, Dr. Alvarez-Jacinto and Dr. Alvarez would prescribe WinRho even when patients neglected to complain of any relevant symptoms. Occasionally, McKenzie would review the patient charts prepared by Alvarez, and if they failed to indicate a history of bleeding so as to support a thrombocytopenia diagnosis, he would instruct her to correct the charts, and she would comply.

An institution can only bill Medicare for treatments if it has a Medicare provider number. Because St. Jude did not have a provider number, Alvarez was enlisted to obtain one in her own name (Alvarez-Jacinto already had his own number). To obtain her provider number, Alvarez signed a form agreeing to comply with applicable laws and Medicare regulations and certifying that she would not “knowingly present or cause to be presented” false or fraudulent claims, nor submit claims “with deliberate ignorance or reckless disregard for their truth or falsity.” All of St. Jude's claims were submitted under either Alvarez-Jacinto's or Alvarez's provider number. Rita Campos was in charge of billing Medicare for the treatments, a service she had provided for the Benitez brothers at their various clinics. She would help prepare what are known as “superbills” for the patients, each showing the same diagnosis code: 287.3, the Medicare billing code for thrombocytopenia. Either Alvarez or Alvarez-Jacinto would sign each of the superbills before it was sent to Medicare.

The nurses at St. Jude were charged with administering the treatments-typically an injection of saline solution or heavily diluted WinRho-and with paying the patients their kickbacks with money they received from M. Rodriguez and Perera. The two nurses at St. Jude were both sent by the Benitez brothers: Appellant Mateos, who had once been married to Luis Benitez, and Carmen Gonzalez, a cousin of the Benitez brothers. Also working at the clinic were Angel Rodriguez (A. Rodriguez), a medical assistant who helped with the infusions, and Beatriz Delgado, a receptionist who was paid $8,000 per month for allowing her name to be listed as president on St. Jude's corporate papers.

St. Jude was an operating clinic for less than five months, from July 2003 to mid-November 2003. The doctors saw about 70 patients per week, and most of the patients came multiple times each week. Many of the patients were homeless or otherwise impoverished; some were “professional patients” who would sit for multiple treatments at as many clinics as were willing to pay them. Sometimes patients did not stay to receive an infusion of any sort, but were paid anyway. On several occasions patients got angry and loudly demanded more money, and these demands were loud enough to be heard throughout the small clinic, which was only about 1100 square feet.

All told,...

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