WASHINGTON — U.S. Sen. Mary Landrieu, D-La., distanced herself Friday from a man who recently plead guilty to perpetrating a $205 million Medicare fraud scheme.
Larry Duran was sentenced last month to a record 50 years in prison for money laundering and providing kickbacks to halfway houses and assisted-living facility operators in return for providing severely mentally ill Medicare recipients to his business.
Duran also was the founder of the National Association for Behavioral Health, which prosecutors said spent $750,000 on lobbying members of Congress. The association held a New Orleans fundraiser for Landrieu in August 2010.
Landrieu declined to comment on the matter Friday but her chief of staff, Jane Baker, issued a statement saying that Landrieu had no knowledge of Duran’s scheme.
The fundraiser was organized by a constituent who is well-respected in the health-care community and is a longtime acquaintance of the senator, Baker said.
Duran did not attend the event, nor did he donate any money to Landrieu’s campaign, Baker said.
Through his Florida company, American Therapeutic Corporation, prosecutors alleged in court documents, Duran paid kickbacks in return for Medicare patients that would attend the corporations facilities and purportedly receive highly specialized treatment in what are called partial hospitalization programs.
Most of the patients were either elderly residents of assisted-living facilities who had dementia, Alzheimer’s disease or brain damage, prosecutors said. Some of the patients didn’t need the treatments while others in need didn’t get them, prosecutors said.
NABH was created to lobby members of Congress to make it easier for such hospitalization programs to make money, prosecutors said. The group was formed in 2006 to fight what would have been devastating cuts to the programs, according to prosecutors.
Duran was staff director for the group for four years, prosecutors said, and used the association to try to enrich himself.
“In actuality, NABH was an organization that provided Duran a legitimate-looking vehicle to lobby Congress to allocate more money, through Medicare, to Duran and his co-conspirators for their fraudulent schemes,” prosecutors alleged in court documents.
The Landrieu fundraiser was reported Friday in The Washington Post newspaper. Citing tax and lobbying records, the newspaper said that the NABH was formed with a corporate address in Baton Rouge but operated in Washington.
NABH provided the newspaper with a statement that Duran has not been involved with the group since 2009.
Prosecutors said in court documents that similar frauds have been replicated in other locations, including Baton Rouge and Houston, two other cities, aside from South Florida, where Medicare fraud has run rampant. A U.S. Department of Justice spokeswoman declined Friday to comment on the case beyond the court documents.
Landrieu commended the U.S. Justice Department for apprehending Duran.
“Senator Landrieu applauds the Medicare Fraud Strike Force for bringing Mr. Duran’s reprehensible crimes to light and holding him accountable for his bad acts,” Baker said.