Medical Billing Company Owner Sentenced to 12 Years in Healthcare Insurance Fraud Scheme

A Long Island man who impersonated an NBA player and others to further his complex healthcare insurance fraud scheme has been sentenced to 12 years in prison and ordered to pay restitution of $337 million and forfeit $63 million. 

Mathew James engaged in a years-long healthcare and insurance fraud scheme in which he and his co-conspirators, including physicians throughout the country, defrauded multiple health insurance companies out of more than $600 million.

He was convicted in July 2022 of conspiracy to commit healthcare fraud, healthcare fraud, three counts of wire fraud, and three counts of aggravated identity theft.

Medical Billing Fraud Scheme

According to court documents, James was the CEO of Leale Inc., a medical billing company that he ran out of his basement. In this healthcare insurance fraud scheme, he billed for procedures that were either more serious or entirely different than those that his doctor-clients performed.

For example, he would submit claims for complex wound cleansing and closures when the actual procedure was a simple minor wound closing such as stitches. Insurance companies would pay more for a complex wound repair than simple stitches.

Most of his clients were plastic surgeons or orthopedic surgeons who were out of network. He earned a commission-based payment in the form of a percentage of the amount paid by the insurance companies on claims that he submitted on behalf of his customers.

He also directed his doctor-clients to schedule elective surgeries through the emergency room so that insurance companies would reimburse at substantially higher rates.

Impersonating Patients

When insurance companies denied the inflated claims, James impersonated patients or their family members, using HIPPA-protected information to demand that the insurance companies pay the outstanding balances in the tens or hundreds of thousands of dollars.

The indictment stated that between July 2015 and June 2019, in this complex healthcare insurance fraud scheme, James made more than 150 calls to insurance companies demanding payment. In many cases he became belligerent, yelling at the customer service representative. He often told the insurance companies that he was going to be referred to a collection agency if they didn’t pay the claim.

For example, the government presented evidence that James impersonated Jeff Pash, the National Football League’s attorney, and Marcus Smart, a professional basketball player, then of the Boston Celtics, in calls made to insurance companies in which James exaggerated medical procedures. The demand for payment resulted in tens of millions of dollars in additional reimbursement to his doctor-clients from which he received a percentage of the fraudulent proceeds.

During the six-week long trial, prosecutors presented recordings of James posing as Pash and engaging in aggressive and profanity-laden interactions with customer service representatives on insurance company hotlines meant for NFL players.

During the trial, Smart expressed his concern about the impersonation, fearing it could damage his reputation as a role model.

“The defendant not only falsified medical records and forged signatures, but also brazenly impersonated patients and their family members, all of which justifies a significant jail sentence to deter others from such audacious conduct,” said Breon Peace, United States Attorney for the Eastern District of New York.

How We Can Help

The Health Law Offices of Anthony C. Vitale represents healthcare professionals in state and federal court who are charged with fraudulent billing, kickbacks, Medicare and Medicaid fraud and false claims, among others.

For more information you can contact us at 305-358-4500 or send us an email to info@vitalehealthlaw.com and let’s discuss how we might be able to assist you.