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For Immediate Release:  
For Further Information Contact:
March 8, 2005

Office of The Attorney General
- Peter C. Harvey, Attorney General
Division of Criminal Justice
- Vaughn L. McKoy, Director

Office of the Insurance Fraud Prosecutor
- Greta Gooden Brown, Insurance Fraud Prosecutor

 

Rachel Sacharow
609-984-1936

 

Former Bergen County CPA Pleads Guilty to Health Care Claims Fraud

Investigation Determined Businessman Inflated More than 4,000 Hours of Therapy and Related Services Provided to Severely Brain-Injured Patients

TRENTON - Division of Criminal Justice Director Vaughn L. McKoy announced that a former Bergen County certified public accountant has agreed to pay $325,000 in restitution after pleading guilty to Health Care Claims Fraud for inflating and submitting fraudulent insurance claims for medical services that were never provided to patients.

According to Director McKoy and Insurance Fraud Prosecutor Greta Gooden-Brown, Barry Cohen, 51, Parkland, FL, pleaded guilty before Bergen County Superior Court Judge Joseph Conte to Health Care Claims Fraud (2nd degree). The charge was contained in a State Grand Jury indictment filed by the Division of Criminal Justice - Office of Insurance Fraud Prosecutor on Sept. 8, 2004. When sentenced on May 13, Cohen faces up to ten years in state prison and a fine of up to $150,000.

Insurance Fraud Prosecutor Gooden-Brown noted that Cohen operated a family-owned corporation known as Headways, Inc., formerly located in Bergen County. Headways, which ceased operations in November, 2000, provided health care services and therapy to patients suffering from brain injuries.

At the March 7 guilty plea hearing, Cohen admitted that between Jan. 15, 1998 and April 30, 2001, he knowingly submitted dozens of health care claims to insurance companies and/or self-funded health benefit plans for patient therapy and related treatments by adding additional hours and/or dates of therapy which were never provided. An investigation by the Division of Criminal Justice - Office of Insurance Fraud Prosecutor determined that Cohen added more than 4,000 additional hours of services totaling more than $350,000 to dozens of bills submitted to the insurance companies for reimbursement or payment.

The insurance companies and health benefits plans that received the false claims included Allstate Insurance Company, Horizon Blue Cross/Blue Shield of New Jersey, State Farm Insurance Company, Proformance Mutual Insurance Company, and Key Benefit Administrators, a third party claims administration company which administered health insurance for the Teamsters Union Local 560 Benefit Fund, as well as the New Jersey Automobile Full Insurance Underwriting Association.

State Investigator Abraham Aquino, Civil Investigator Douglas Graham, and Deputy Attorneys General Nicholas Vasile and Beth A. Hardy were assigned to the investigation. DAG Vasile represented the Division of Criminal Justice - Office of Insurance Fraud Prosecutor at the guilty plea hearing. The case was referred to the Office of Insurance Fraud Proseutor by Horizon Blue Cross/Blue Shield of New Jersey.

“The Division of Criminal Justice - Office of Insurance Fraud Prosecutor is committed to protecting New Jersey’s citizens from unscrupulous acts by combating insurance fraud in whatever form it takes,” said Insurance Fraud Prosecutor Greta Gooden Brown. “When health care providers commit fraud it is particularly disturbing, because the integrity of the health care insurance claims process depends on the trustworthiness of the licensed professionals involved. As it has in the past, the Office of the Insurance Fraud Prosecutor will vigorously investigate and prosecute this type of criminal activity.”

In 2004, criminal prosecutions by OIFP resulted in the imposition of jail sentences totaling 199 years of incarceration - an increase of over 70% from the prior record-breaking year. Since its inception in 1998, the OIFP has screened over 60,000 reports of suspected insurance fraud, imposed over 4,500 fines totaling more than $22 million, obtained orders for over $46 million in civil and criminal restitution, pursued criminal prosecutions resulting in the conviction of approximately 840 insurance fraudsters, and sent nearly 300 convicted defendants to jail for more than 648 years.”

Noting that some important cases have begun with anonymous tips from the public, Prosecutor Brown emphasized that individuals can make a difference. “We need people’s information, not their identities. People who are concerned about insurance cheating and have any information about a fraud can call our toll-free hotline at 1-877-55-FRAUD, or visit our Web site at www.NJInsurancefraud.org .”


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