At the University of Maryland Medical Center, employees in the competitive world of health care reaped rewards when they recruited new colleagues. Workers could pocket up to $5,000 each time they found an applicant who later became a medical center employee.
However, Paula Anderson turned the hunt for new employees into a lucrative crime.
Anderson, who worked in the medical center's human resources department, admitted yesterday in federal court in Baltimore that she turned the incentive system on its head.
As part of her guilty plea to theft, prosecutors said she enlisted the help of friends - even her mother - to say that they had referred new employees they had never met. Her friends would then receive the referral bonus and kick back between a half and two-thirds of the money to Anderson, according to court documents filed in U.S. District Court in Baltimore.
The medical center, with about 5,700 employees, paid about $1.47 million in employee referral bonuses between 2003 and 2005. Prosecutors found that more than 20 percent of the total - about $317,000 - was improperly doled out to employees.
The scheme hatched by Anderson was a felony, prosecutors said, because the medical center received more than half of its funding in public money from Medicaid and Medicare.
Anderson's plea made her the eighth employee to admit guilt in the scandal. The only case remaining is for Anderson's mother, Carlet Clemons, who court records show collected more than $32,500 in bonuses over three years. She has pleaded not guilty, and the case is set for trial. However, prosecutors said in court yesterday that both sides had recently discussed a possible guilty plea.
Medical center officials have repeatedly declined to answer questions about the federal investigation and indictments.
Instead, they issued a statement, saying in part that "in December 2005, we discovered evidence which indicated that several former employees may have colluded to fraudulently receive payments from our Employee Referral Program."
These programs, officials said, are commonplace in the health care field, where certain professionals such as nurses are highly sought.
"Upon discovery of this theft, we conducted an internal investigation and then notified federal authorities," the statement said. "The individuals involved are no longer employed by the University of Maryland Medical Center."
Medical center officials said they had provided full cooperation to federal investigators. It was unclear what kind of employee bonus system, if any, exists now at Maryland.
"We have implemented a new verification process that is working well," the statement said. "This new process is audited frequently to ensure compliance with all policies and procedures."
At yesterday's hearing, Anderson answered most of the questions from U.S. District Judge Richard D. Bennett without elaboration. But when asked to described if she was satisfied with her court-appointed defense attorney, former state attorney general candidate Stuart O. Simms, she said: "Mr. Simms has really dug deep into the case," adding that Simms "has kept me informed."
Anderson declined to comment through her attorney after the hearing. Her sentencing has been set for April 5.