For Immediate Release - September 24, 2010

Newton Man and Three Former Employees of Regional Transit Authority Indicted in Medicaid Kickback Scheme

Transit Authority Brokers Transportation Services In Pioneer Valley, North Central and South Central Massachusetts, And Greater Boston

WORCESTER - A Newton man who owns five separate transportation businesses was indicted today for allegedly paying kickbacks to employees at a public regional transit authority in order to get the employees to divert transportation services paid for by the state's Medicaid program to one of his companies, Attorney General Martha Coakley announced today.

Alex Shrayber, 55, was indicted on charges of Medicaid Kickbacks (2 counts), and Corrupt Gifts, Offers or Promises to Influence Officials Acts (4 counts). In addition to the indictments against Shrayber, the employees who allegedly accepted those kickbacks and colluded with Shrayber, were also indicted today as part of the alleged scheme.

Investigators in the Attorney General's Office allege that Shrayber made cash payments to Montachusett Regional Transit Authority (MART) employees between January 2007 and April 2010. Authorities allege that Shrayber had an ongoing arrangement with these employees which involved monthly payments in return for bypassing the authority's "low-bid system" and diverting transportation assignments for MassHealth recipients from other companies to one of Shrayber's five transportation businesses. Payments for those rides were funded by MassHealth. Administrators at MART have cooperated with this ongoing investigation.

"The non-emergency transportation services offered by MassHealth provide access to a full range of medical services from routine physician visits to dialysis treatments," said AG Coakley. "We allege the defendants engaged in a scheme that resulted in higher costs for taxpayers and our Medicaid program, while also compromising the public integrity of the bidding process."

A Worcester Grand Jury returned the following indictments today against the defendants:

Alex Shrayber, 55, of Newton
Medicaid Kickbacks (2 counts)
Corrupt Gifts, Offers or Promises to Influence Officials Acts (4 counts)

Nancy Osorio, 33, of Leominster
Medicaid Kickbacks (1 count)
Corrupt Gifts, Offers or Promises to Influence Officials Acts (2 counts)

Leanna Swift, 28, of Leominster
Medicaid Kickbacks (1 count)
Corrupt Gifts, Offers or Promises to Influence Officials Acts (1 count)

Maria Gutierrez, 50, of Fitchburg
Medicaid Kickbacks (1 count)
Corrupt Gifts, Offers or Promises to Influence Officials Acts (2 counts)

According to authorities, Shrayber owns five separate transportation businesses that contracted work with MART, a public agency that brokers transportation services to vendors in Pioneer Valley, North Central Massachusetts, South Central Massachusetts and Greater Boston. MART provides transportation to recipients of MassHealth, a state Medicaid program responsible for providing health insurance for the economically disadvantaged.

Shrayber was arrested on July 20, 2010 without incident. He was subsequently arraigned in Leominster District Court on the charge of Medicaid Fraud Kickbacks (1 count) and Bribery (1 count) in connection to the same alleged scheme. On August 27 th, Sharyber was arraigned in Fitchburg District Court on charges of Medicaid Fraud Kickbacks (1 count) and Bribery (1 count).

A Grand Jury returned the indictments today against Shrayber, Osorio, Swift, and Gutierrez. All are expected to be arraigned at a later date in Worcester Superior Court.

Montachusett Regional Transit Authority is one of the Regional Transit Authorities (RTAs) which provides non-emergency medical transportation services to recipients of MassHealth. The RTA acts as a broker, accepting requests for transportation from MassHealth members and matching those requests with transportation providers based on lowest price, availability and vendor capacity. Assuming that the vendor has availability and capacity, the RTA must match requests for transportation to the provider with the lowest bid. This is referred to as the "low-bid system."

Shrayber's businesses include: Delta Community Transportation, Inc.; Women in Transit, Inc.; East-West Transportation, Inc.; IBF Transportation, Inc.; New England Trans Services, Inc.

Assistant Attorney Generals George Zachos and Melissa Celli, of Attorney General Coakley's Medicaid Fraud Division, are the prosecutors assigned to this case. The case is being investigated by Dean Bate, investigator with AG Coakley's Medicaid Fraud Division, along with members of the Massachusetts State Police assigned to the Attorney General's Office. Both the Massachusetts Medicaid Program and the Department of Public Health assisted in this investigation.