Hanford man arrested in insurance fraud case

HANFORD - A Hanford man and a Kingsburg man are among a dozen former members of the Accident Helpline Medical Group arrested in connection with a three-and-a-half-year insurance fraud investigation. The suspects allegedly overbilled insurance companies and prescribed excessive time off work for patients covered by workers' compensation insurance.

The medical group operated several different offices, which were located in Hanford, Fresno and Merced. The organization "was a legitimate business," said Mark Voss, chief investigator for the Fresno office of the California Department of Insurance Fraud Division. However, "Accident Helpline Medical Group is no longer in service," said Voss.

Last week, authorities booked Hanford-based physician assistant William Edward Sheaffer, 60, into Kings County Jail. Sheaffer posted $100,000 bail Thursday, a jail official said.

It is unknown whether Sheaffer is still working. He did not return a phone call to his home Tuesday. However, the Physician Assistant Committee of California listed him as active on its Web site. His license is not due to expire until May 2008.

Also last week, Kingsburg chiropractor Mark Peter Lungren, 34, surrendered to the Merced County Superior Court. Merced County jail officials would not confirm whether Lungren had ever been booked there.

Since 2002, state investigators had received workers' compensation fraud referrals accounting for more than $1 million.

Complaints and tips brought to light by Geico and Zenith, among other insurance companies, sparked the investigation, the CDI said.

The 10 other suspects, including five chiropractors, a doctor of osteopathy, and four other clinic workers, were either arrested, or surrendered upon receiving word of the investigation against them.

They were all held on $100,000 bail, and all have since posted bond, officials said.

According to the CDI, chiropractor Charles Richard Affatato, 34 of San Francisco, was booked into the San Francisco County Jail.

Marisela Vargas-Montes, 40, and Jamson Everett Walker, 35, both of Fresno, and chiropractor Ralph Gregory Howell, 58, of Clovis were booked into Fresno County jail.

Chiropractor Lorene Louise Hebert, 58, of Raymond, and Emma Mendez-Defarlass, 25, of Fresno, surrendered to Merced Superior Court last week.

Dr. Mikel R. Meyer, 50, of Sparks, Nev., surrendered to the South Lake Tahoe Police Department. Eva Soria Prieto, 22, of Orange Cove, and Ronald Wayne Richards, 58, and Elizabeth Rodriguez, 27, all of Fresno, surrendered to Fresno County Jail.

Whether the suspects worked together or alone to carry out the fraud is "hard to determine at this point," Voss said. All of them will stand trial in Merced.

"The primary victim in the case (Foster Farms) is located in Merced," said Merced Deputy District Attorney Mark Bacciarini.

The Merced County District Attorney's Office has filed multiple fraud charges against the suspects, which include charges of conspiracy to commit insurance fraud, and presenting false written or oral material in regard to a workers' compensation claim for the purpose of obtaining or denying compensation.

Bacciarini said the suspects "have been given various arraignment dates over the next couple of weeks." Bacciarini also said he hopes to have a preliminary hearing involving all the suspects Oct. 26, and anticipates a joint trial to follow.

Insurance fraud affects everyone, because it raises premiums, CDI officials said.

"The theory of insurance is everyone pays into one pot, and then if you have (an accident or illness), your claims are taken out of that pot. So if (an insurance company) has more going out than going in, it has to raise the premiums to cover the outgoing," said Voss.

In other words, if fraudulent claims cost insurance companies more than they are making from premiums, the premiums must rise to match that cost.

Officials will not conduct individual investigations into the suspects' past before their employment with Accident Helpline, because there is a statute of limitations for insurance fraud charges of four years, Voss said. At this time, no patients will be charged with any wrongdoing.

(September 27, 2006)