ATTORNEY GENERAL HILL AND STAFF CONTRIBUTE TO LARGEST HEALTHCARE FRAUD TAKEDOWN IN U.S. HISTORY

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Multiple investigations uncover more than $1 million in Medicaid fraud

INDIANAPOLIS – Attorney General Curtis Hill today announced that his office made vital contributions to the largest healthcare fraud takedown in U.S. history. The Office of the Indiana Attorney General’s Medicaid Fraud Control Unit (MFCU) played a key role in seven federal criminal investigations that uncovered more than $1 million in Medicaid fraud, leading to the indictment of 15 individuals and two companies on various charges.

Each of the seven investigations were part of Healthcare Fraud Takedown Week, an initiative led by the Office of Inspector General of the U.S. Department of Health and Human Services. Other participating agencies included the Kentucky Medicaid Fraud Control Unit and three federal agencies – the FBI, DEA and IRS.

The Indiana Attorney General’s MFCU investigated licensed healthcare professionals and medical offices where suspected illegal activity occurred. Investigators uncovered illegal practices such as false and fraudulent billing; distributing and prescribing controlled substances without legitimate medical purpose; and money laundering schemes. One investigation revealed that a transportation company was billing for trips that were never taken, uncovering more than $440,000 in fraudulent claims.

Throughout the investigation process, one common denominator arose: Scammers repeatedly took advantage of society’s most fragile individuals and those for whom they supposedly were providing care – the disabled and less fortunate who rely on Medicaid.

“Medicaid fraud is not a victimless crime,” Hill said. “When licensed professionals and organizations target those who rely on Medicaid, they’re also putting taxpayers on the hook. These actions truly impact all of us. The culmination of these investigations is extremely rewarding for the investigators and lawyers in our Medicaid Fraud Control Unit who work tirelessly to bring these offenders to justice. I applaud their efforts.”

The office’s MFCU also assisted in two investigations that took place in central Indiana. Raymond E. Massengill, who operated as Patient Access Transportation and with business locations in Marion County and Johnson County, was at the center of one of the two investigations. Massengill is charged with health care fraud after he allegedly submitted 42 false claims to the Indiana Medicaid program for trips that were never taken. The fraudulent billing resulted in a $15,762 loss to Indiana Medicaid. Ronald Sheppard, a chiropractor who owned and operated Castleton Integrative Health in Indianapolis, was indicted on charges of conspiracy to violate anti-kickback statute and money laundering. Sheppard is alleged to have been paid both directly and indirectly by certain pharmacies for referring compounded medication prescriptions. Sheppard is accused of money laundering and violating anti-kickback statute.

One of the largest losses to the Indiana Medicaid program was discovered during MFCU’s investigation of two employees of Med 1st in Evansville, Indiana, where Chiropractor Mitchel Stukey and Karen Poeling are accused of distributing and prescribing controlled substances using signed blank prescription pads, then attempting to launder the money obtained from this illegal activity.

Multiple agencies including the DEA worked with MFCU during the investigation, which lasted nearly five years. Stukey and Poeling have been charged with five counts of healthcare fraud; conspiracy to violate the Controlled Substance Act; and conspiracy to commit money laundering. These alleged activities resulted in an estimated loss of $490,000 to the Indiana Medicaid program.

The alleged actions of two employees at Sunshine Transportation – located about 10 miles east of Kokomo, Indiana – led to an investigation that revealed an estimated loss of nearly $449,000 to the Indiana Medicaid program. Investigators, along with the FBI and other agencies, allege that Shawn and Amanda McNew of Sunshine Transportation fraudulently billed Indiana Medicaid for trips that were never taken. Both Shawn and Amanda McNew were charged with falsifying trips that were never taken and violation of the federal anti-kickback statute, which prohibits a person from paying or receiving anything of value, including kickbacks and bribes, intended as an inducement for referral of federal health care program business.

MFCU, in collaboration with nine additional agencies, assisted with an investigation that led to the indictment of three healthcare professionals employed at Physicians Primary Care PLLC in Jeffersonville, Indiana, where the suspects are accused of conducting illegal activity such as distributing and prescribing controlled substances. Four entities or individuals were indicted on 21 charges, including distributing and prescribing controlled substances without legitimate medical purpose and outside professional medical practice; and fraudulent billing. The accused are: Physicians Primary Care PLLC; Jeffrey Campbell, MD; Mark Dyer, RN/APN; and Dawn Antle, RN/APN.The total loss to the Indiana Medicaid program has yet to be determined.

The Indiana State Police, MFCU and additional agencies conducted another investigation that discovered similar activity in Fort Wayne, Indiana, at North Anthony Pharmacy & Wellness Center. Charges were brought against James E. Ranochak, MD, along with two pharmacists, Brent Losier and Charles Ringger, for allegedly conspiring to distribute and dispense controlled substances without legitimate medical purpose as well as fraudulent billing.

Working with the FBI, IRS and additional agencies in Indiana and Kentucky, the office’s MFCU assisted with an investigation that resulted in charges against employees accused of conducting a money laundering scheme at an Indiana company called JM Autism (most recently known as “Total Spectrum”) near New Albany, Indiana. The 28 charges filed against the organization’s former employees Janice Patterson, Tanesha Washington and Katerrell Kennedy were the most stemming from one MFCU-involved investigation.

In each of the seven investigations, the aforementioned indicted individuals and business are innocent until and unless proven guilty.

“We become most vulnerable when a person or organization claims to have our best interest in mind, disguising their wrongdoing by feigning concern for our well-being,” Hill said. “These investigations are important reminders that our society will always have individuals and organizations that will abuse both power and privilege in an attempt to cheat the system at the expense of honest, good-hearted people. Hoosiers should rest assured that my office will continue working hard to protect Indiana residents and families from the kinds of improprieties uncovered in these investigations.”

In 2016, the dedicated work of the office’s MFCU led to 47 convictions and the recovery of nearly $37 million in taxpayer funds.

Indictment documents and photos are attached. Medicaid Fraud Control Unit Director Matt Whitmire today will be available to media from 11:30 a.m. until 1 p.m. Contact Press Secretary Corey Elliot if you would like to schedule an interview during that time or want to request supporting documents.

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