Third suspect charged in $80M Valley-wide healthcare fraud scheme

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A third person has been charged in a sprawling scheme to defraud a federal workers’ compensation program out of $80 million.

Federal authorities arrested Jessica Marie Kinser, an employee of the Texas Federal Wellness Center, on Thursday.

She is charged with a single count of conspiracy to commit healthcare fraud.

Her arrest follows a superseding indictment against her, 46-year-old McAllen resident Ricardo Cano and his sister Rosita Cano Meeks, 56, who were arrested on Aug. 24, 2023.

All three face the conspiracy to commit healthcare fraud charge while Meeks and Cano are facing 11 counts of healthcare fraud. Cano faces an additional seven counts of money laundering.

They have pleaded not guilty.

The alleged scheme spanned between 2014 and 2019.

Cano was a physician’s assistant who directed his employees to call him “Dr. Cano.”

He operated the Texas Federal Wellness Center, or TFWC, which has locations in Brownsville, Corpus Christi, Edinburg, Harlingen, McAllen and El Paso. Meeks was in charge of billing and Kinser managed employees and operations at various TFWC entities.

“From in and around 2014 to in or around July 2019, Defendants Cano, Meeks, and Kinser submitted, and caused to be submitted, approximately $80 million in claims to (the Department of Labor’s Office of Worker’s Compensation Program), including false and fraudulent claims for items and services,” the superseding indictment stated.

Kinser, Cano and Meeks are accused of making employees falsify patient records to make it appear that they were at TFWC facilities longer than they actually were.

“Instead of recording the true check-out time when patients left a TFWC facility, employees were directed to calculate a fictional, inflated check-out time,” the superseding indictment stated.

The trio is accused of falsifying patient records to support those fictitious check-out times and concealing that patients received a fraction of physical therapy that was billed.

“Cano, Meeks, and Kinser, submitted, and caused to be submitted, claims for medical visits that did not occur,” the superseding indictment stated. “Cano, Meeks, and Kinser caused TFWC employees to falsely document medical visits that did not occur.”

Their own employees warned them about this.

“Cano and Meeks failed to correct the improper practice of inflating and falsely documenting units of physical therapy services despite being warned that the practice was improper by .. employees,” the original indictment stated.

Federal prosecutors allege that Cano, who was not a doctor and had no authority to provide these services without an actual doctor, entered into an agreement with a Travis County doctor only identified as “Physician 1” to further the alleged scheme.

On paper, “Physician 1” controlled everything, but prosecutors say Cano controlled and managed the operations, controlled the bank accounts, served as president and received the profits.

“Meanwhile, Physician-1 had virtually no substantive role in the management, operation, or control of the (business) and rarely, if ever, visited the … clinics,” the original indictment stated. “In truth and in fact, ‘Physician-1’ sold his medical license to Cano, who used the license to operate the … medical facilities without appropriate medical supervision.”

By 2017, the Texas Medical Board caught wind of this after a complaint was filed. However, that complaint was eventually dismissed through deceit, according to federal prosecutors.

“Cano and Physician-1 falsely represented to the Texas Medical Board that (the business) had been brought into compliance with Texas law when, in truth and in fact, the (facilities) were at all times operated in violation of Texas law,” the original indictment stated.

The superseding indictment alleges that Kinser assisted in procuring false records related to TFWC entities to deceive the Texas Medical Board about TFWC’s ownership and control.

“As a result of the deception by Cano, Physician-1, and Kinser, the Texas Medical Board dismissed the complaint relating to the TFWC’s entities,” the superseding indictment states.

Kinser made a first appearance in McAllen federal court on Monday morning in front of U.S. Magistrate Judge J. Scott Hacker. She was scheduled for a detention hearing in the afternoon.

Meeks remains free on a $100,000 cash bond with a $5,000 deposit while Cano is free on a $500,000 secured bond, court records show.

Editor’s note: This post was updated to remove images incorrectly published with this story.