Psychologist Rhett McCarty defrauded the U.S. government of more than $1 million

February 25, 2013

KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a psychologist practicing in the Lebanon, Mo., area was sentenced in federal court today for engaging in a $1 million scheme to defraud Medicare and Medicaid.

“Those who defraud the government are stealing from the pockets of law-abiding taxpayers,” Dickinson said. “This psychologist flagrantly abused the system to enrich himself for more than three years, but today he is being held accountable for his actions.”

Rhett E. McCarty, 67, of Lake Ozark, Mo., was sentenced by U.S. District Judge Howard F. Sachs to three years in federal prison without parole. The court also ordered McCarty to pay $1 million in restitution to Medicaid and Medicare.

McCarty was a licensed psychologist and private practitioner who provided psychotherapy services to recipients of both Medicare and Medicaid in their homes in the Lebanon area. On Aug. 16, 2012, McCarty pleaded guilty to health care fraud and to forgery.

“Rhett McCarty violated the trust extended to him by the American taxpayers to provide medical services to our Medicare and Medicaid beneficiaries,” said Special Agent in Charge Gerry Roy of the Health and Human Services – Office of Inspector General. “He is now being held responsible for his violations. At HHS-OIG, we will continue to work with our federal and state law enforcement and prosecution partners to ensure the solvency and integrity of our federally-funded health care programs.”

Between Sept. 17, 2008, and April 5, 2012, McCarty submitted Medicare and Medicaid claims for daily or near daily psychotherapy services to 19 beneficiaries for which he was paid $1,276,334. According to the claims that McCarty submitted, he routinely saw beneficiaries seven days per week and worked long hours every day. Moreover, according to McCarty’s claims, he worked every single day of the calendar year from mid-September 2008 through early April 2012, except for Christmas day. McCarty routinely billed for every weekend day and for all holidays except Christmas day.

Although McCarty did provide some services for most of these beneficiaries, he admitted that he did not see those beneficiaries more than once a week. McCarty also admitted that the amount he was paid by Medicare and Medicaid for services he did not provide to these 19 beneficiaries was $1 million.

McCarty also admitted that he forged (or caused another person to forge) the signatures of five of the beneficiaries on patient sign-in sheets in order to obtain $418,507 in Medicare and Medicaid payments.

This case was prosecuted by Assistant U.S. Attorney Lucinda S. Woolery. It was investigated by Health and Human Services – Office of Inspector General, the FBI and the Medicaid Fraud Control Unit.

Source: "Psychologist sentenced for $1 million health care fraud," press release of the U.S. Attorney's Office for the Western District of Missouri, January 30, 2013.