Originally created 06/28/01

Ex-Healthmaster official loses appeal



A former Healthmaster executive convicted of Medicare fraud in 1995 lost another bid to have his convictions reversed.

In an order signed Tuesday, U.S. District Court Judge Anthony A. Alaimo adopted the report and recommendations by U.S. Magistrate Judge W. Leon Barfield to deny Dennis Kelly's motion to vacate his convictions.

In February, Judge Barfield presided over a hearing in U.S. District Court in Augusta to hear evidence that Mr. Kelly claimed would show his defense attorneys at trial were ineffective.

Mr. Kelly testified for the first time in his criminal prosecution. He testified that didn't know his defense team had planned not to present any evidence during his trial in July 1995. Neither his attorneys nor attorneys representing David Suba, his co-defendant, presented any evidence at trial.

Mr. Kelly's lead defense attorney, Celeste T. Jones, testified at the hearing in February that Mr. Kelly was involved in every aspect of the defense and that he insisted he did not want to testify at trial.

Mr. Kelly was the chief financial officer of the Augusta-based Healthmaster, a home health company founded by Jeanette G. Garrison. Before federal agents obtained criminal indictments in March 1995, Healthmaster operated in five states with 125 offices, taking in $100 million a year from Medicare. Ms. Garrison was a top political fund-raiser in Georgia and served as President Clinton's 1992 campaign co-chairwoman.

A whistle-blower led federal investigators to uncover $10 million in fraud at the company. Ms. Garrison pleaded guilty to reduced charges, testified against Mr. Kelly and corporate executive Mr. Suba, and served about 2 1/2 years in prison.

Mr. Kelly is nearly finished with his 97-month federal sentence. Mr. Suba, sentenced to serve eight years in prison, has been a fugitive since he was reported missing at the prison camp at Eglin Air Force Base in Florida in May 1998.

Reach Sandy Hodson at (706) 823-3226 or shodson@augustachronicle.com.