By Terelle Jerricks, Managing Editor
Two members of ILWU, Local 13, were arrested on federal fraud charges Dec. 7. The arrests followed a Nov. 18 indictment alleging they caused two Port Medical clinics to bill the union’s health care plan for chiropractic services that either were not provided or were not medically necessary.
Sergio Amador, 49, of Downey, and David Gomez, 52, of San Pedro, were arrested without incident by federal authorities.
For the past three years, local health care providers, independent contractors such as chiropractors, massage therapists and acupuncturists, saw their reimbursement rates slow to a trickle.
This was due primarily to changes to the ILWU-PMA Benefits plan in 2009 in which a third-party administrator was assigned to monitor all claims on the ILWU-PMA benefits plan.
With the indictments and arrest of Armador and Gomez, there’s now an explanation for why the third-party administrators were flagging these claims.
The ILWU-PMA benefits plan covers 100 percent of all chiropractic charges with no out- of-pocket costs to the benefits plan member. The benefits plan includes up to 40 visits related to any particular diagnosis and up to 18 related symptoms in the absence of a diagnosis.
As a result, a code of conduct was developed to address specific areas of concern. The chiropractic portion of the benefits plan prohibits offering any incentive, including rebates, free or discounted treatments or gifts of any type to plan members for recruiting them as patients.
The benefits plan also requires that all treatments be medically necessary and only address the specific condition that was diagnosed and documented in the patient’s history.
Armador and Gomez were charged with breaking just about all of these rules and pocketing the money.
Investigators painstaking connected how Amador and Gomez set up and controlled Port Medical, information that was largely hidden by a corporate veil.
According to the grand jury indictment, Amador and Gomez incorporated Port Medical and opened bank accounts for three related companies, including: DCS, Chosen and Ramport to receive funds from Port Medical. Those monies were then used to pay themselves and pay incentives to and on behalf of plan members. In return, those members would receive medical and chiropractic services at Port Medical and encourage other plan members to do the same.
The indictment alleges that the longshore workers gave benefit plan members incentives. These included sports teams sponsorships, cash payments, free massages and facials, and other gifts and services in return for those benefit plan members receiving medical and chiropractic services from Port Medical.
The pair pleaded not guilty to the charges and was freed on bond. They were ordered to stand trial, Feb. 2, 2016.