[HOUSTON, TX] - A 41-count health care fraud indictment charging a recruiter and three durable medical equipment company operators for their alleged involvement in a multimillion dollar wheelchair fraud scheme to defraud Medicare and Medicaid, was unsealed today following the arrest of three named defendants by investigating agents, United States Attorney Don Degabrielle announced today.

Terri Ann Orozco, also known as Terri Thurman, Carmelita Thurman, and Sharon Thomas were arrested today, without incident by agents of the Health & Human Resources, Office of Inspector General, Office of Investigations, the Houston Medicaid Fraud Control Unit and the FBI. Each of the three is appeared in federal court this afternoon. The fourth defendant, Michelle Ann Ray, is presently out of the state. Now aware that a warrant for her arrest is outstanding, Ray is expected to surrender herself to federal authorities in Houston on Wednesday, August 1, 2007.

Terri Ann Orozco, 43, Carmelita Thurman, 34, along with Michelle Ray, 40, jointly ran three durable medical equipment (DME) companies in Houston - Twice as Nice Medical Supply, Top of the Line Medical Supply and Heart to Heart Medical Supply. The indictment alleges that between 2002 and 2004, the three companies, which are now closed, billed Medicare and Medicaid approximately $7.18 million and were paid approximately $3.47 million, primarily for allegedly supplying motorized wheelchairs and related accessories to Medicare/Medicaid beneficiaries.

Thomas, the owner of S&L Personal Care, is accused of buying and selling prescriptions for motorized wheelchairs from various Houston physicians, soliciting/recruiting Medicare and Medicaid beneficiaries to receive wheelchairs and working with Orozco to sell wheelchair prescriptions to DME companies, including the ones operated by Carmelita Thurman and Michael Ray.

The indictment alleges that while the Medicare and Medicaid programs were billed for motorized wheelchairs and related accessories, the patients usually received a less expensive scooter costing thousands less. For those who did receive a motorized wheelchair, the indictment alleges that patients were not evaluated by a doctor and did not meet the medical qualifications to receive the equipment. In Houston, during the relevant time period alleged in the indictment, the Medicare reimbursement rate for a K0011 motorized wheelchair and related accessories was approximately $4,700. With the Medicaid 20 percent co-pay, the amount paid by the federal health care programs for a claim was close to $6,000. The wholesale cost of scooter and a motorized wheelchair is approximately $800 to $1,000, respectively.

The indictment alleges that the defendants made numerous cash withdrawals of more than $10,000 from checking accounts into which Medicare and Medicaid funds were deposited, knowing that the funds were proceeds from their fraudulent activity.

All four defendants are charged with health care fraud, conspiracy and money laundering under two different statutes. Additionally, Orozco, Thurman and Thomas are charged with receiving illegal kickbacks from other durable medical equipment companies for the sale of patient information and prescriptions for wheelchairs. The prescriptions and Certificates of Medical Necessity (CMN) are needed to process a claim to Medicare and Medicaid.

The statutory maximum penalty, upon conviction for health care fraud, conspiracy to commit health care fraud, money laundering and conspiracy to commit money laundering is 10 years imprisonment, without parole. Each statute also carry substantial fines as possible punishment. The statutory maximum penalty for violating the Anti-kickback statute is five years imprisonment and a maximum fine of $250,000.

At this afternoon's appearance, the court ordered that Terri Thurman and Carmelita Thurman could each be released on bond upon the deposit of $2,500 of a $100,000 bond. The court further ordered that while each must maintain gainful employment while on bond, neither will be permitted to work for any company that bills Medicare of Medicaid. Thomas was ordered temporarily detained without bond pending a bond hearing to be held on Monday, August 6. All three defendants are scheduled for arraignment on the charges on Monday.

This investigation leading to the charges in this case was conducted by agents of the Federal Bureau of Investigation, the Texas Attorney General's Medicaid Fraud Unit in Houston; U.S. Health & Human Services-Office of the Inspector General, Office of Investigations. Special Assistant United States Attorney Suzanne Bradley is prosecuting the case.

An indictment is an accusation of criminal conduct, and not evidence. The defendants are presumed innocent unless and until convicted through due process of law.