In a press release dated September 27, 2023, the U.S. Attorney's Office in the Southern District of Texas announced that Jesus Virlar-Cadena was sentenced to serve 50 months in federal prison for his alleged role involving the submission of over $150 million in purported false claims to Medicare for hospice and other services. The court also ordered Virlar-Cadena to pay $9 million in restitution and $9 million in forfeiture.

From 2009 to 2018, Virlar-Cadena served as the medical director of the Merida Group, a healthcare company that operated multiple locations throughout Texas. Merida Group hired Virlar-Cadena and other medical directors but allegedly made payment of their medical director fees contingent upon an agreement to certify Medicare patients for hospice who were not terminally ill. According to the press release, evidence at trial allegedly demonstrated that Merida Group marketers falsely told patients they had less than six months to live. In addition to medical director fees, Virlar-Cadena allegedly received luxury trips and other perks. Virlar-Cadena was previously licensed as a physician, but the Texas Medical Board later suspended his medical license. A federal jury convicted co-conspirators Rodney Mesquias, Henry McInnis, and Francisco Pena in October 2019. Additional information regarding Mesquias and McInnis is available in a 2020 DOJ press release available here.

This development underscores the continued enforcement focus on the hospice industry and the government’s focus on holding individuals accountable for alleged wrongdoing. Hospice medical directorships have been, and continue to be, a key enforcement area.

The DOJ press release regarding Virlar-Cadena is available here.