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Three Clearwater men accused of defrauding Medicaid

The goal was to renovate the bathrooms of disabled Medicaid patients so they could live more independently.

Instead, officials say, the work at eight homes was poorly done, and some "severely disabled" Medicaid clients were left with inoperable bathrooms and equipment. One bathroom developed a mold problem and couldn't be used for weeks.

Meanwhile, investigators say Medicaid paid the men who did the jobs a total of $71,574.

On Thursday, three Clearwater men were arrested and accused of defrauding Florida's Medicaid program out of more than $50,000 since August 2003.

Agents from the state's Medicaid Fraud Control Unit arrested Richard Allen Lehman, 59, of 912 Pine St., Gary G. Auffarth, 51, of 1670 Jeffords St., and Harry Sherman Lochbaum Sr., 65, of 1447 Stewart Blvd.

Investigators say eight disabled Medicaid recipients were victims in Pinellas, Hillsborough, Orange and St. Lucie counties. The were left with shoddy, unsafe bathroom remodeling work that could not pass electrical or plumbing inspections.

Medicaid was billed for seven of those projects.

The Medicaid Fraud Control Unit began investigating after a disabled victim complained about bathroom renovations done by A&L Projects under a contract with the Medicaid program.

Lehman, a licensed contractor, is president of A&L Projects, state attorney general's investigator Rebecca Nichols wrote in a sworn statement. Auffarth, an unlicensed contractor, is vice president.

Investigators say Medicaid paid Lochbaum, an unlicensed contractor, to provide cost estimates for renovations, but he was not qualified to do the work and had misrepresented his credentials.

Lochbaum used Lehman's contracting license to obtain contracts for renovations aimed at helping disabled Medicaid recipients live more independently, according to officials. The deal, investigators say, was that A&L would get 20 percent of the contract price and Lochbaum would get 80 percent for completing the work, which was mostly done without A&L's supervision.

In some cases, A&L Projects did no work at all or did such substandard work that the recipients were left with inoperable bathrooms and other equipment, according to the state. A&L Projects also double-billed the Medicaid program for services and materials, investigators say.

One bathroom, demolished and left for weeks, developed a mold problem. In other homes, investigators said, Lochbaum tried to get Medicaid recipients' parents to pay for construction materials that the state had already paid for. And Lochbaum cut corners on materials, investigators say, buying lesser quality than state standards specify or reusing existing equipment instead of buying new as contracts specify.

Lehman, Auffarth and Lochbaum were each booked into the Pinellas County Jail on one count of organized scheme to defraud. Lochbaum also faces one count of Medicaid fraud.

The case will be prosecuted by the Attorney General's Office of Statewide Prosecution.

If convicted on all charges, Lehman and Auffarth each face a possible prison sentence of up to 30 years and a $10,000 fine, officials said. Each was released after posting $60,000 bail. Neither could be reached for comment Thursday evening.

Lochbaum, who was being held in lieu of $60,000 bail Thursday night, faces up to 35 years and a $15,000 fine.

Times staff writer Theresa Blackwell can be reached at tblackwell@sptimes.com or (727) 445-4170.

Three Clearwater men accused of defrauding Medicaid 05/29/08 [Last modified: Monday, June 2, 2008 1:30pm]
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