Former N.J. CPA Fined in Health Care Scam

June 29, 2005

New Jersey Division of Criminal Justice Director Vaughn McKoy announced that a former Bergen County certified public accountant has been ordered to pay more than $433,000 after pleading guilty to Health Care Claims Fraud for inflating and submitting fraudulent insurance claims for medical services that were never provided to patients.

According to McKoy and Insurance Fraud Prosecutor Greta Gooden-Brown, Barry Cohen, 51, Parkland, Florida, was ordered by Bergen County Superior Court Judge Joseph Conte to pay $328,000 in restitution and a $105,000 civil fine. In addition, Cohen was sentenced to three years probation. On March 7, Cohen pleaded guilty to Health Care Claims Fraud, a charge which was contained in a State Grand Jury indictment filed by the Division of Criminal Justice – Office of Insurance Fraud Prosecutor on Sept. 8, 2004.

Gooden-Brown noted that Cohen operated a family-owned corporation known as Headways Inc., formerly located in Bergen County. Headways, which ceased operations in November, 2000, provided health care services and therapy to patients suffering from brain injuries.

At the guilty plea hearing, Cohen reportedly admitted that between Jan. 15, 1998 and April 30, 2001, he knowingly submitted dozens of health care claims to insurance companies and/or self-funded health benefit plans for patient therapy and related treatments by adding additional hours and/or dates of therapy which were never provided.

An investigation by the Division of Criminal Justice – Office of Insurance Fraud Prosecutor determined that Cohen added more than 4,000 additional hours of services totaling more than $350,000 to dozens of bills submitted to the insurance companies for reimbursement or payment.

The insurance companies and health benefits plans that received the false claims included Allstate Insurance Company, Horizon Blue Cross/Blue Shield of New Jersey, State Farm Insurance Company, Proformance Mutual Insurance Company, and Key Benefit Administrators, a third party claims administration company which administered health insurance for the Teamsters Union Local 560 Benefit Fund, as well as the New Jersey Automobile Full Insurance Underwriting Association.

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