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Fraud Investigation of the Year – The Sharma Case

Doctor-couple bilked private insurance companies and federal health care programs of $200 million

Posted by Dawn Lomer on November 28th, 2011

In the process of gathering evidence for a health care fraud case, the fraud investigation team found almost $700,000 in cash in the home of Texas rheumatologist Dr. Arun Sharma and his wife, Dr. Kiran Sharma. The money was packed in white envelopes inside plastic grocery bags. Investigators also found more than $800,000 in safe deposit boxes. This was just the tip of the iceberg. The Sharmas also had several properties, including a $700,000 home, and 99 bank and investment accounts.

The Sharma case, chosen as the NHCAA 2011 investigation of the year, was presented at the NHCAA Annual Training Conference in Atlanta this year by three members of the 14-member investigative team: Assistant United States Attorney Al Balboni of the US Attorney’s Office, Lieutenant Rob Lunsford of the Texas Office of the Attorney General, and Investigator Ken Kempf from BlueCross BlueShield of Texas. As they took turns outlining the strategies and cooperation that went into the building and resolution of the case, a picture emerged of two doctors driven by greed, with no regard for the people whose lives they put at risk.

The Scheme

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The Sharmas had billed private insurance companies and federal health programs $200 million for procedures that they didn’t perform over the course of ten years. Instead of performing the procedures for which they were billing, they were injecting patients with a mixture of lidocaine and steroids for joint pain and writing prescriptions for controlled substances. The pair hired foreign medical graduates to falsify the medical records of patients to justify the billing.

Records showed that the Sharmas were seeing more than 100 patients per day and on one particular day saw 279 patients. They wrote more than 126,000 prescriptions for controlled substances, for which they charged uninsured patients $100 cash. Dr. Arun Sharma became known as Dr. Franklin for his penchant for the bills bearing the portrait of the American patriot. He was also known for the ease with which he prescribed Hydrocodone, Soma and Xanax as well as stronger narcotics such as Oxycodone, Methadone and Fetynal patches.

Faked Injections

Even though the injections the Sharmas administered were just trigger point injections, they billed the insurance companies for facet joint injections, paravertebral injections, sacroiliac nerve injections, sciatic nerve injections and various nerve block injections. Nearly every patient was prescribed one or more controlled substances and put on a regimen of repeated injections every two weeks.

Veritable Blank Checks

To ensure maximum billing, the Sharmas required patients to sign progress and procedure notes in their patient charts to prove they were at the clinic and received the shots. Patients who refused to have shots every two weeks were required to sign progress and procedures notes anyway and eventually some were asked to sign blank forms that the Sharmas used to bill insurance companies even when a patient wasn’t in the clinic.

The investigation team reviewed 1,000 boxes of records, interviewed more than 100 witnesses and served 45 Grand Jury subpoenas. Their efforts resulted in guilty pleas and prison sentences of 15 years for Dr. Arun Sharma and eight years for Dr. Kiran Sharma. The couple was ordered to forfeit $44 million in assets and cash.

Dawn Lomer
Dawn Lomer

Manager of Communications

Dawn Lomer is the Manager of Communications at i-Sight Software and a Certified Fraud Examiner (CFE). She writes about topics related to workplace investigations, ethics and compliance, data security and e-discovery, and hosts i-Sight webinars.

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