A former chief financial officer for the nation's largest private home health company told jurors in Savannah, Ga., last week that the owners used Medicare money to influence politicians and to pay for lavish trips.
Lloyd Brubaker testified in the federal trial of Brunswick, Ga.-based First American Home Health's founders, Jack Mills and his wife, Margie, and Arthur DeLozier, vice president for accounting for the company formerly called ABC Home Health Care.
The three face charges including defrauding Medicare, which reimbursed the company $400 million for services last year. They were named in an 82-count federal indictment that also includes charges of mail fraud, money laundering, filing false tax information, obtaining kickbacks and funneling unlawfully large campaign contributions to Gov. Zell Miller through employee bonuses that were charged to Medicare.
Brubaker, who now works at a law firm in Little Rock, Ark., testified that Mills paid lobbyists to push home-care legislation in Congress in 1991. Mills then charged Medicare for the lobbyists' salaries, Brubaker said.
The testimony came during the first week of a trial that could last four weeks. Prosecutors have said they may call as many as 80 witnesses. The defense plans to call about 135.
Defense attorneys say their clients are innocent victims of vague government regulations and auditors determined to put ABC out of business.
In other testimony, a state auditor said more than $250,000 in nonbusiness flight costs on ABC Home Health Care's corporate airplanes was reported to and reimbursed by Medicare in the early 1990s.
An additional $477,000 in costs for lobbying also were billed to Medicare, auditor Pat Terris said, as was more than $100,000 in salaries to various ABC employees that prosecutors claim did little or no work for the company.
Terris works for the state Department of Health and Human Resources.
Under cross-examination by defense lawyers, Terris admitted that she had based her findings on information supplied by federal investigators and had backed it up with only "spot checks" with company ledgers, airplane logs and other records.