The United States Attorney’s Office announced today that James and Dennis Froeschner and Healthnet Regional Center of Cuba were indicted on multiple counts of submitting false reimbursement claims for non-rendered health services to Medicare and MO HealthNet.

According to the indictment, James Froeschner was president and CEO of Healthnet (HRCC), and his brother Dennis Froeschner did the billing.  HRCC is owned by Novae Health Net, which is  owned by James Froeschner.

Rural health centers, such as HRCC, provide services in medically under served areas and are reimbursed for visits, called encounters.  MO HealthNet defines a visit as a face to face encounter between the patient and either a physician, nurse practitioner, nurse midwife, physician assistant, licensed clinical social worker, or clinical psychologist.  The encounter must include a  medically necessary evaluation and management service.

The indictment alleges that James Froeschner developed and distributed to his employees a written “Protocol,” describing how patient appointments were to be handled at HRCC.  They basically were instructed not to indicate on daily schedules and patient records that patients did not keep their appointments. It was part of the fraud scheme that Dennis Froeschner billed for all patients on a  list he had compiled of patients who were scheduled to be seen on a regular basis, although he knew some of the  patients had not kept their  appointments.

According to the indictment, Dennis Froeschner also billed for health services to relatives accompanying a patient to HRCC although the relatives received no services, for  chart reviews where the records do not indicate a  physician reviewed the charts, and for encounters  when  the only service provided was arranging transportation or authorizing a prescription refill. James Froeschner had instructed his staff to complete encounter forms for these activities.

According to the indictment, James and Dennis Froeschner submitted numerous claims for services provided on the weekends when the clinic was closed and patients did not receive services. As an example, claims were submitted for services on Mother’s Day and Easter Sunday, although the patients did not receive any services on these days.

James Froeschner, 68, Cuba, MO; and his brother Dennis Froeschner, 58, also of Cuba, were each indicted by a federal grand jury on one felony count of health care fraud and 57 counts of making false statements involving health care benefit programs.  Heathnet Regional Center of Cuba, Inc., was also indicted on the same charges.

If convicted, heath care fraud carries a maximum penalty of 10 years in prison and/or fines up to $250,000; each count of making false statements carries a maximum penalty of five years in prison and/or fines up to $250,000.  The penalty for Healthnet, if convicted, is a fine of $500,000 per count of the indictment.

This case was investigated by Health and Human Services Office of Inspector General.  Assistant United States Attorney Dorothy McMurtry is handling the case for the U.S. Attorney’s Office.

The charges set forth in an indictment are merely accusations, and each defendant is presumed innocent until and unless proven guilty.