After 3 Months, Home Health Manager Released from 3-Year Prison Sentence for $2 Million in Healthcare Fraud

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Federal Court Agrees with Chapman Law Group’s Arguments for ‘Compassionate Release,’ As 70-Year-Old Client’s Health Increased His Risk of Contracting COVID-19

As the COVID-19 pandemic ravages on throughout the United States, there’s one segment of the elderly population that remains especially vulnerable to contracting the Coronavirus: older prisoners. To keep them behind bars — in an environment where the virus spreads at a virtually uncontrollable clip — does not just affect their personal health, but the health of inmates and correctional facility workers as well.

Chapman Law Group attorneys Ronald W. Chapman II and Meaghan McKeon, of our White Collar Defense & Government Investigations practice section, recently secured an early release for a Troy, Michigan, home health business manager who was convicted of more than $2 million in healthcare fraud. He was able to serve just three months of his 36-month sentence, as a federal judge recognized that his age (70) and health condition “put him at an increased risk of severe complications” given the COVID-19 pandemic.

This victory is a prime example of the “compassionate release” legal argument, which asks a judge to consider situations — sanitary, environmental, or other — that the court could not have “reasonably” anticipated before a defendant was sentenced.

When ‘Extraordinary or Compelling Circumstances’ Arise, Healthcare Fraud Prisoners Can Argue for Compassionate Release

In the case, defendant Liberty Jaramillo pleaded guilty to healthcare fraud, per 18 U.S.C. § 1349, in June 2017. His sentence of 36 months’ imprisonment was handed down in May 2018, but because of his age and medical conditions — including tachycardia, heart palpitations, high cholesterol, type 2 diabetes, rheumatoid arthritis, gout attacks, and hyperthyroidism — his surrender date was extended. Jaramillo eventually reported to federal prison in November 2020.

Soon after Jaramillo’s incarceration, he filed a motion for compassionate release under 18 U.S.C. § 3582(c)(1)(A). This statute allows for prisoners to petition for early release because of “extraordinary or compelling circumstances which could not reasonably have been foreseen by the court at the time of sentencing.”

In Jaramillo’s situation, it was his age and medical history, coupled with the nature of a prison’s close quarters, that would make him vulnerable to COVID-19 — a pandemic that “could not reasonably have been foreseen by the court” at his May 2018 sentencing.

One stipulation for a compassionate release request is that it be served before the warden, who will have 30 days to respond to it. In Jaramillo’s case, the warden did not respond, so our attorneys stepped in.

Prisoner’s Age, Health Puts Him in ‘Much More Vulnerable Position’

In his February 16, 2021, order granting release, U.S. District Court Judge Gershwin A. Drain noted that Jaramillo’s health situation made for a valid argument.

“Here, the Centers for Disease Control (‘CDC’), the Government, and numerous courts acknowledge that Defendant’s age and underlying health conditions … put him at an increased risk of severe complications from COVID-19. …”

Further, Jaramillo “meet[s] the CDC’s classification of adults sixty-five years and older who are at higher risk of COVID-19 complications,” and “nearly all of Defendant’s conditions independently fit into the CDC’s definition of moderate to severe risk; together, ‘his conditions [] exacerbate each other, placing him in a much more vulnerable position than a healthy person, if he were to get COVID-19.’”

“In sum, upon consideration of precedent for granting compassionate release and the particular facts of his case, Defendant has presented extraordinary and compelling circumstances under 18 U.S.C. § 3582(c).”

What’s More Important: Criminal Conduct Deterrence or Lethal Infection Prevention?

The government contended that reducing Jaramillo’s sentence “will not adequately reflect the seriousness of the offense, promote respect for the law, provide just punishment for the offense, or afford adequate deterrence of criminal conduct.”

Yet the Court pointed to a recent decision, United States v. Gardner, No. 14-CR-20735-001 (E.D. Mich. July 22, 2020), which stated that, given the COVID-19 pandemic, “‘a longer sentence would also have a greater potential for exposing a particularly vulnerable prisoner to the coronavirus, and the Court must weigh the value of deterrence against increasing the threat of a possibly lethal infection.’ … [I]n balancing the circumstances … ‘deterrence weighs less.’ Here, the risk of exposure to Defendant, who is likewise a particularly vulnerable prisoner to COVID-19, outweighs the value of deterrence.”

In addition, the Court acknowledged Jaramillo’s offense as “unquestionably serious,” but “it was also a nonviolent, first time offense.”

How Does a 36-Month Sentence Get Reduced to 3 Months?

As mentioned, Jaramillo was only into his third month of a 36-month sentence. But, “[w]hen extraordinary and compelling circumstances exist and the § 3553(a) factors otherwise support compassionate release, courts have concluded a reduction in sentence will not contravene § 3582(c), even though a defendant has not served at least fifty percent of the imposed sentence.” (Emphasis added.)

The Court also looked into other factors that made up Jaramillo’s case and Jaramillo’s complying with the sentencing.

“Defendant has demonstrated that he has strong family ties in the community and unlikely odds of recidivism. … Further, he was consistently compliant with his pre-trial release conditions and had no disciplinary incidents during the over two-year period of his stipulated voluntary surrender date extensions.”

Will ‘Compassionate Release’ Cases Like These Increase?

As with any federal criminal law matter, challenging a healthcare fraud conviction in the time of COVID-19 will never mean a reduced sentence or early release — even if an incarcerated defendant says his/her health puts them at high risk — is secured.

These cases are reviewed cautiously and judiciously, as every defendant’s circumstances are different. In short, anyone who’s a prisoner aged 70 or older will not be considered for release carte blanche on their age alone.

The National Healthcare Defense Attorneys at Chapman Law Group Can Help You with Healthcare Fraud Sentencing Matters

While we at Chapman Law Group cannot guarantee any healthcare fraud sentencing outcomes, our criminal defense attorneys have the sought-after experience for healthcare providers who are accused by the federal government of:

We represent licensed medical professionals across the U.S. with white collar criminal defense in the healthcare sector, including:

Our four national offices are in Detroit, MichiganMiami and Sarasota, Florida; and Los Angeles/Southern California

Contact us today and let us put our know-how to work for you.

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Ronald W. Chapman II, LL.M.
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Chairperson of White Collar Defense & Government Investigations

Michigan Office
1441 W. Long Lake Road, Suite 310
Troy, MI 48098
Phone: (248) 644-6326

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