The Other Final Four: Hospital Executives Sentenced to Prison

April 26, 2021

Sorry college basketball fans, this post has nothing to do with basketball, unless former Continuum Healthcare, LLC executives, and now felons, Bobby Rouse, Steven Houseworth, Jeffery Parsons, and David Edison will be playing pickup games on the prison yard.

Rouse, Houseworth, Parsons, and Edison are the final four to be sentenced out of a total of 14 individuals charged and convicted in 2019 for their roles in a massive kickback scheme resulting in what prosecutors alleged resulted in $189 million in fraudulent billing to the Medicare program.

On April 22, 2021, Rouse, age 81, was sentenced to 10 years in prison, Edson, age 72, to 4 years in prison, Parsons, age 62, to 30 months in prison, and Houseworth, age 47, to 30 months in prison.

Continuum owned Westbury Community Hospital in Houston as well as community mental health centers, each of which operated a partial hospitalization program, also known as a “PHP”, an intensive, short-term treatment program for individuals with mental illness.

In addition to Rouse, Houseworth, Parsons, and Edson, the remaining 9 individuals charged and convicted in the scheme were either owners of personal care homes or “marketers” for Continuum’s mental health programs.

At the center of the allegations against the 14 was that the hospital executives, marketers and personal care home owners conspired, including concerning the payment and receipt of kickbacks, for the referral of patients from the personal care homes to the Continuum facilities. Additionally, the vast majority of the referred patients did not even qualify for the PHP program.

Although it’s unclear what triggered the investigation, the charges against the 14 resulted from a joint investigation on the part of the OIG, the Texas Attorney General’s Medicaid Fraud Control Unit, and the IRS.

In my experience, most kickback schemes are not as brazen as this. They involve fewer numbers of people and, sometimes, behavior that is more easily rationalized by the participants as “sort of legal”.

My usual admonition applies: Be extremely careful before becoming involved in any arrangement involving payment of any sort, whether in dollars or in kind, in connection with the referral of patients. Get advice from someone qualified to give it, someone who’s not simply earning a fee to tell you what you want to hear. As they say, talk’s cheap. Your freedom is dear.

You might come to the conclusion that the former hospital execs, Rouse, Houseworth, Parsons, and Edson, were crazy thinking they could get away with a scheme involving 14 individuals including fraud magnet “marketers”, especially when the program they ran was supposed to be treatment for individuals with mental illness.

Luckily, each of the four former Continuum executive team members will now qualify for free healthcare, including free mental health services, courtesy of the Federal Bureau of Prisons, your tax dollars at work.

If you think kickback schemes pay off in the end, well, you’re nuts, too.

Comment or contact me if you would like to discuss this post.

Mark F. Weiss

Comment or contact me if you would like to discuss this post. Mark F. Weiss

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