A U.S. District Court jury in Alexandria yesterday convicted a Reston physician of mail fraud in connection with a scheme to defraud the Medicaid and Medicare programs.
The jury found Dr. H. Barry Jacobs guilty after deliberating about five hours Wednesday night and yesterday morning. U.S. District Court Judge Oren R. Lewis set sentencing for May 27.
This was Jacobs's second trial on the charge. A federal jury that heard the case last month was unable to reach a verdict.
Jacobs, 34, could be imprisoned for up to five years or ordered pay $1,000 fine, or both, according to an assistant U.S. attorney. An attorney for Jacobs said yesterday the verdict will be appealed.
Assistant U.S. Attorney Frank W. Dunham Jr., who prosecuted the case in the second trial, said yesterday that he was "pleased with the verdict." The jury's decision an important one, he said, because it usually is difficult "to convince jurors to convict doctors."
Stephen R. Pickard, a former assistant U.S. attorney now in private practice, acted as a special government assistant in Jacobs' first trial last month. Pickard also said it is difficult to convict physicians for abusing the government medical prgrams.
"The main problem is that the programs are set up by doctors, for doctors, to help doctors," Pickard said. "The regulations are fraught with loopholes. Doctors can be dishonest and can bill the heck out of the programs. He can get a billing clerk, and if a mistake it made, he can blame the bookkeeper . . . (The programs are) easier for a doctor to rip off than to do it right."
He added that efforts to get convictions are further impeded "because it's difficult to get doctors to testify against other doctors, it's difficult to get records, and to get people who work for doctors to testify against them. Juries have great sympathies for doctors, and defense attorneys will argue that the programs' regulations are nebulour."
Since 1966, when the Medicare program began, through the end of last year, there have been about 26,100 allegations of fraud and 21,800 allegations of abuse, according to a national Medicare spokesman. Of the 746 cases that were forwarded to the Department of Justice for prosecution, there were 220 convictions, 284 cases are awaiting trial and people were cleared in the other cases. Of those convicted 137 were physicians, and 37 of the doctors went to prison, the spokesman said.
Medicaid has no central repository of Medicaid fraud and abuse data, but a telephone survey of the nation's regional offices showed that there were 282 indictments for Medicaid fraud and abuse in 1976, according to a Medicaid official. There were 137 convictions and $13.3 million was recovered, he said.
During the 1976, there were two Medicaid indictments and one conviction in Virginia, 20 indictments and 17 convictions in Maryland, and no indictments in the District, according to the survey, the official said.
Jacobs was indicted last December, along with two other men connected with the now defunct Metropolitan Diagnostic Laboratory in Lessburg. Fugitive warrants have been issued for the other men named in the indictment, Victor H. Salerno and James K. Sawicki.
During the three-day trial, Dunham described the elaborate scheme Jacobs, Sawicki, and Salerno allegedly concocted whereby they billed Medicaid and Medicare for blood tests that had not been performed, and charged the two medical agencies for hgher priced tests they claimed were done manually but actually were performed by a machine.
"They threw (untested) blood down the sink, they threw away (untested) Pap smears, and they falsified bills," Dunham said in closing arguments, citing testimony from witnesses. He said that the fraudulent practices occured with Jacobs' "tacit knowledge . . . and approval."
Phillip J. Hirshkop, Jacobs' attorney contended that his client was not responsible for what may have occurred at the laboratory. He told jurors, "Don't convict Barry Jacobs for what Victor Salerno did."
Hirshkop called the government's case "snow job," and said prosecutors had set a "wonderful little bureaucratic trap." He said Jacobs only did what was accepted medical procedure and was convinced that what he was doing was legal.
jacobs, who frequently was described as "innovative" and "a brilliant young surgeon" by his attorney, was expelled from the Fairfax County Medical Society last year. The society claimed he violated terms of a society-imposed probation. Jacobs has said that he was denied due process in the matter and is appealing his expulsion. The Reston doctor also his filed for bankruptcy.