HIPAA Violations Result in Jail Time for New York Identity Thief

A New York identity thief who stole the medical data of approximately 1000 patients and committed $10.7 million in Medicare fraud has been convicted of HIPAA violations by a New York federal court and sentenced to serve 12 years in a federal penitentiary.

Over the course of a four year period, Helene Michel, the owner of Hicksville NY., Medical Solutions Management Inc. (MSM), impersonated a doctor – acting under the name Dr. Elene Allonce – as well as nurses, wound care specialists and other healthcare professionals to gain access to Social Security numbers and medical information of patients in order to make fraudulent medical claims to support her extravagant lifestyle.

Michel was able to gain access to nursing facilities in Nassau, Suffolk, Queens, Kings and Dutchess Counties between April 2003 and March 2007. She was able to obtain the information necessary to make bogus Medicare claims for services provided by her company. The proceeds from her crimes were used to purchase a $2.2 million Old Brookville home, set up a personal pension plan as well as an investment brokerage account, estimated to be worth $2 million.

The crimes she committed potentially prevented patients from receiving medical care they required, although in once instance she managed to obtain reimbursement for prescription boots and leg braces that her company supplied to an elderly double above-the-knee amputee; according to according to PHIPrivacy.net.

Michel was charged in March 2012 with conspiracy and health care fraud and was one of the first individuals to be charged with violations of the Health Insurance Portability and Accountability Act for the wrongful disclosure of Protected Health Information. This case is one of just a handful that has resulted in a criminal conviction for HIPAA violations.

At the trial, fifteen boxes of patient files containing mostly original copies of medical information were used as evidence according to Loretta E. Lynch, U.S. Attorney for Eastern District of New York. She said “Through her scheme she violated the privacy of over a thousand patients and stole Medicare funds dedicated to preserving the health of our seniors and other citizens.”

Michel potentially faced a jail term of up to 10 years per count, although she will only be required to serve 12 years instead of the maximum term of 30 years for the three counts. She could also have potentially been fined $250,000 for each count, although she has lost the $1.3 million that the government seized from her when she was indicted. Etienne Allonce was also indicted along with Michel, although he remains a fugitive and is currently listed on HHS-OIG’s Most Wanted List.

Medicare and Medicaid fraud can result in patients being denied services and treatments they need and/or being given incorrect treatments, both of which potentially have life threatening consequences. This case highlights the importance of checking Explanation of Benefits statements. Any fraudulent activity must be identified promptly to ensure any damage can be mitigated.

Author: Steve Alder has many years of experience as a journalist, and comes from a background in market research. He is a specialist on legal and regulatory affairs, and has several years of experience writing about HIPAA. Steve holds a B.Sc. from the University of Liverpool.