Woman to be sentenced in Medicare fraud

Hernando County resident Renee Marcus Steely will cooperate with prosecutors. She is to be sentenced Oct. 31.

By JEFF TESTERMAN

© St. Petersburg Times,
published September 3, 2001

TAMPA -- For years, Renee Marcus Steely used a mail-order doctorate, a toll-free hotline and a vast network of health care connections to lure insured patients into treatment centers around the country.

Steely, a 60-year-old Hernando County resident, said she provided a valuable service for addicts and others needing treatment, and she insisted she did nothing wrong in placing patients who reached her after dialing 1-800-322-NEW-U.

Now Steely has changed her tune.

The woman once described as "the queen" of the patient brokering business in the United States has pleaded guilty to federal conspiracy charges and faces up to five years in prison, a $250,000 fine and an unspecified amount of restitution to U.S. Medicare providers.

Steely's sentencing on Oct. 31 will bring to a close the federal investigation into the major players in a nationwide network who took or paid millions in illegal kickbacks to place Medicare patients in treatment.

The going rate for patients placed by Steely and others was frequently $3,000 each or higher. It is a federal crime to take or pay anything of value for the referral of Medicare patients.

In a six-year investigation, the U.S. Attorney's Office in Tampa successfully prosecuted some 50 defendants in the patient brokering conspiracy and won court orders for fines and restitution totaling more than $15-million.

The investigation, which tracked bribes and kickbacks from treatment centers in more than a dozen states, was sparked by a 1993 St. Petersburg Times series, "The Patient Pipeline." The series included a profile of Steely, and chronicled the stories of patients enticed into unnecessary or inappropriate treatment by bounty hunters who made so much profit they could afford their own treatment centers.

Steely herself invested in several Tampa Bay area Partial Hospitalization Programs, where brokered patients got daily treatment financed by Medicare. At a detox program in New Port Richey called Daylight of West Florida, patients were recruited by Steely from an Alabama treatment center and flown to Florida at her expense, according to the FBI.

Steely was charged in a 19-count indictment returned in March of last year and accused of taking more than $3-million in illegal kickbacks.

In a guilty plea accepted by a federal magistrate on Aug. 13, Steely admitted her role in a conspiracy to take $1.76-million in illegal kickbacks and to pay out another $906,741 in illegal brokering fees.

The U.S. government is seeking restitution from Steely, as well as forfeiture of her assets. But despite taking a fortune in kickbacks, Steely has claimed to be anything but wealthy. When Steely was arrested last year, her attorney said she lived in a Spring Hill mobile home, had been unemployed for three years and was the sole support of her 93-year-old mother.

Prosecutors may require Steely to take a polygraph test on the question of her assets, according to her plea agreement.

Steely has agreed to cooperate with prosecutors, but she will not have to testify on direct examination at a trial concerning any family members. At least one relative was involved in the corporations Steely used in her patient brokering business.

As early as 1991, Steely brokered patients seeking help for alcoholism and addiction through a company called National Information and Referral Service. The company's business card listed Steely as having a doctoral degree. Her doctorate actually was obtained by Steely for $1,000 from a California diploma mill called the College of Divine Metaphysics.

In her plea, Steely has admitted taking illegal kickbacks for patients from 10 groups, including $280,176 from the now-closed Care Unit of Florida, $886,900 from a defunct Sarasota center called Alternatives Inc., and $51,555 from Progressive Health Care, a New Jersey company run by William DeMaria Jr.

Prosecutors say DeMaria was the ringleader of the largest illegal patient brokering network in the United States, a criminal enterprise which helped pay out $32-million in kickbacks. DeMaria's group brokered patients into The Manors hospital in Tarpon Springs, Suncoast Hospital in Largo and Heritage Beverly Hills Hospital in Citrus County.

DeMaria, Steely and other confederates used phony invoices and contracts to disguise illegal kickbacks as payments for marketing, diagnostic assessments or aftercare, court documents say.

A recovering drug user, DeMaria, 41, moved into stock day-trading while assisting prosecutors with the patient brokering case. In April, a federal judge characterized DeMaria as "the king of kickbacks," sentencing him to 16 months in prison and ordering him to pay fines and restitution totaling $1.75-million.

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