Springfield Woman Sentenced in $7M Scheme to Defraud Medicaid

Springfield, NJ -- A Springfield woman, who was the owner of a home health agency in Linden, was sentenced today to 60 months in prison for her role in a $7 million scheme to defraud Medicaid and engage in bribery, money laundering, and tax evasion, U.S. Attorney Paul J. Fishman announced.

Irina Krutoyarsky, 62, of Springfield, previously pleaded guilty before U.S.District Judge Katharine S. Hayden to an information charging her with conspiracy to commit health care fraud, bribery, conspiracy to commit money laundering, and tax evasion.

Judge Hayden imposed the sentence today in Newark federal court.

Krutoyarsky owned HHCH Health Care Inc., of Linden, which provided home health aides and health care services to New Jersey residents that were subsidized under the N.J. Medical Assistance Program (Medicaid).

"Krutoyarsky and her conspirators defrauded Medicaid by submitting false documents to the N.J. Board of Nursing, the state agency responsible for issuing home health aide certifications," according to documents filed in this case and statements made in court. "Krutoyarsky falsely represented that prospective home health aides had attended and satisfactorily completed required training and testing."

Instead, she charged the health aids hundreds of dollars for getting the fraudulent certifications and then billed Medicaid for services that had never been rendered.

Services they falsified included claiming they had visited patients and provided them health care services. Instead the home health aides had other jobs, were on vacations overseas, or were in other parts of the state during the times they claimed they were with patients, according to documents filed in this case and statements made in court.

Cash kickbacks were also reportedly given to patients who were also participating in the scheme.

A cooperating witness, who worked with federal agents, posed as a prospective home health aide to Krutoyarsky. During a meeting in January 2012, Krutoyarsky told the witness that they would get “free money [from the] Government," according to documents filed in this case and statements made in court.

She also reportedly hired home health aides who had no certifications or status in the county and sent them t patients' homes while billing Medicaid claiming they were certified.

Krutoyarsky defrauded Medicaid out of $7 million, according to the report.

She reportedly used money from Medicaid to purchase property in New Jersey, New York and Florida.

An employee of the N.J. Department of Labor (NJDOL), who was working undercover, reported Krutoyarsky also bribed them in mid-2010 after they received a complaint that she was not paying overtime wages.

If she turned over her records it would reveal the Medicaid fraud scheme so Krutoyarsky paid around $10,000 in cash bribe to the employee -- who was wearing a wire and recorded Krutoyarsky making the bribe payment on video.

She again bribed the employee in May 2011 with around $15,000 which was also captured on video, according to court records.

Between 2007 and 2011, Krutoyarsky cheated the IRS out of $907,150 in taxes due and owing to the United States.

In addition to the prison term, Krutoyarsky was sentenced to three years of supervised release, and ordered to pay $7 million in restitution and entered a forfeiture order for $7 million, including forfeiture of her home in New Jersey and properties in New York City and Florida.