Vital Health Care

Observed Fraud and Abuse

1. In 1997, I observed Joe Martinez spenting 100% of his time away from Vital Health Care, so he could observe the construction of his new house. During his absence Mr. Martinez drew a salary that later was charge agains the Medicare Program. The day the ORT auditor appeared at Vital Health Care, Mr Martinez returned to work at Vital Health Care, giving the appearance he had been on the job all along. Joe share an office with me.
2. In addition to draw a salary from Medicare, during his long absences of weeks and months, Mr. Martinez, withdrew additional payroll funds which he claimed as PDO’s (Personal Days Off). Mr. Martinez was quick to chastise employees for taking "company time" for offenses as minor as being late from lunch by 5 minutes, despite his practice of short days and frequent absences.
3. During construction of this new home in 1997, the Martinez Family hired an interior decorator, charging merchandise and services from the Vital Health Care checking account, later charged to the Medicare program. Checks number 21910, 21909, 17369, 17374, 17383, 23670, 24100 written to Wanda Waldrop, and signed by Diana Martinez between April 1997 and October 1997, are examples of their theft from the Medicare Program. (See Enclosed copies of checks). This is a small sample of their fraud and abuse.
4. In 1998, in attempts to overcome new medicare benefit caps, Diana Martinez purchased, with Vital Health Care funds, what she decribed as a "clean" (no overpayments) Medicare number from a Kathleen Grey (or Gray), and started a second medicare company under the name Heart of Texas Health Services, charging approximately $80,000 to the medicare program under that new number. After receiving an overpayment notice for approxiately $80,000, Mrs. Martinez blamed Kathleen Grey for not providing a "clean" Medicare number. Having not fully consumated transfer of the Medicare number, Mrs. Martinez took the position that she had never "owned" the Medicare license, thereby implying that the employees of Heart of Texas Health Services were employees of Kathleen Grey, very likely leaving Ms. Grey with an burden not rightfully belonging to her.
5. During 1997 or 1998, Diana Martinez withdrew funding approximating $80,000 from Vital Health Care. According to the company cost accountant, such funds (being Medicare assets) must be released under a loan agreement with the company and repaid according to a repayment schedule with interest. My observation suggests that only two or three payments have been made near the beginning. I believe the funding amount has gone beyond the $80,000 figure.
6. During my involvement with the generation of employer tax returns, most (if not all) reconciliation errors ultimately traced back to Martinez family members as not withholding Social Security or Medicare from their paychecks. I had to complain several times to the owners until this practice was stopped.
7. Prior to my employment at Vital Health Care, Norma Anaya, the other owner of Vital Health Care, claimed the title of Director of Finance. Norma Anaya charged a salary from the Medicare program in excess of $100,000 per year. In the first half of 2000, I sat down with Norma to discuss the cost report and general ledger items. During our discussion, Norma asked me in all seriousness, "What is an asset?", which clearly demonstrated non-qualification for a six figure salary charged to tax payors. Prior to the ORT audit, Norma’s duties appeared to be shopping at the mall on company funds.
8. A general practice voiced by ownership, was to assess employees as mediocre in order to not provide "amunition" in the event of EEOC action by employees. This statement was repeated a number of times by Joe and Diana Martinez.
9. A general practice observed was a "scrabbling" of finances between company books, for example, funds from Vital Health Care were used to start Heart of Texas Health Services, employee advance paid from Vital Health Care were recouped through VHC, Primary Home Care, Inc. This practice created a discrepancy of over $200,000 between two companies, which required hiring an outside accountant to reconcile. As the one who would be faced with the task of preparing the cost reports for the state programs, I repeated pleaded for proper handling of finances, after which I was no longer invited to meetings on such matters.
10. In 1998, Texas Workforce Commission paperwork regarding wage verification for purposes of unemployment benefits crossed my desk. From my observation, both employees were still working for the company. In 1999, I was asked to accept unemployment benefits in lieu of a paycheck, while still working for the company. I refused to accept the arrangement, and received a cut in pay by $18,000/year. I was laid off in 2000 after completing the cost report.
11. From appearances cash funds generated from the immunization program have been directly pocketed by the owners. Receipts for cash transactions have not been produced, despite repeated requests for this documentation. My best estimates were produced from bank deposit records of check payment during reconciliation and an MS-Access program I created to track immunizations.
12. My complaints to the owners of the handling of finances have been met with responses ranging from indifference to hostility, ultimately I was layed off.
13. After my layoff, they only offered work for a price that would not support me under existing conditions. This attitude eventually forced me out of my residence.