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Broward Psychiatric CEO Sentenced To 25 Years For Medicare Fraud

A judge just sentenced a psychiatric CEO to 25 years in prison for Medicare fraud.

Karen Kallen-Zury, a 60-year-old Lighthouse Point woman, and CEO if the Hollywood Pavilion psychiatric facility was also ordered to repay about $40 million to the Medicare program and had her bond revoked.

The judge also delivered lengthy prison sentences to two other Hollywood Pavilion executives who were also convicted this summer. Daisy Miller, 44, received a 15-year sentence and Christian Coloma, 49, a 12-year sentence. Miller was allowed to remain free bond while she pursues an appeal because she is the mother of two young girls.

Justice Department prosecutor alleged that Kallen-Zury led a bribery conspiracy to lure patients to rooms infected with insects and then kicked them out after their Medicare benefits ran out. In June, Kallen-Zury and the other defendants was found guilty of submitting false Medicare claims for $67 million over almost a decade, and covered up the scheme by falsifying the records of ineligible patients and fabricating marketing contracts with patient recruiters.

The defendants were also guilty of conspiracy, healthcare fraud, wire fraud and kickback offenses.

The prosecution of the facility was the latest federal crackdown against operators of mental-health facilities accused of bilking the Medicare program, by charging for treatment of alcoholic and drug-addicted patients who did not need therapy or receive it.

Prosecutor Zink wrote in a court filing, “In this case, fraud scheme is a derivative of a larger crime- the exploitation of human beings to obtain unfettered access to their taxpayer-funded, government-administered insurance benefits, all for personal gain. Kallen-Zury was the mastermind.

Miller, a co-defendant, claimed to be unaware of the criminal activity at Hollywood Pavilion. However, Coloma was convicted of conspiring with Coloma to pay $1 million in bribes to recruiters to supply Medicare patients from South Florida and out of state.

A fourth defendant, Michele Petrie, 64, who was the director of outpatient facility, sentencing is scheduled for Dec. 18.

Although the prison terms were substantial, the Justice Department sought harsher sentences: 40 years for Kallen-Zury, 30 years for Miller and 25 years for Coloma.

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Source: The Florida Herald, “Psychiatric CEO, 60, sentenced to 25 years in prison for Medicare fraud in Broward,” Sept. 10, 2013.

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