Indiana health care providers indicted as part of national crackdown on fraud

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An Indianapolis-area chiropractor is among more than a dozen people in Indiana-based investigations and hundreds of people nationwide charged in health care fraud and opioid scams worth $1.3 billion.

U.S. Attorney General Jeff Sessions on Thursday announced the indictments. The Office of the Indiana Attorney General's Medicaid Fraud Control Unit was among the many agencies involved in the investigations around the country.

The Indiana unit uncovered more than $1 million in Medicaid fraud, leading to the indictment of 15 individuals and two companies. Among those is Ronald Sheppard of Fishers of Castleton Integrative Health, according to his indictment. Sheppard is listed as CEO of the firm in the company's most recent filing with the Indiana Secretary of State (as of August 2016).

Authorities say Sheppard encouraged other chiropractors to refer patients to certain pharmacies for which he received kickbacks. He also received kickbacks for referring his own patients to the pharmacies. He was indicted on charges of money laundering and conspiracy to violate the anti-kickback statute.

Sheppard served as head of the Indiana State Chiropractic Association from 1996 to 1997, according to the indictment. Sheppard did not respond to calls from IBJ seeking comment on the charges.

Sessions called the nationwide takedown the largest in U.S. history, with doctors and other individuals charged for improperly prescribing and distributing opioids and other narcotics and billing Medicaid and Medicare. Of the 412 people charged, 56 were doctors and 120 cases were related to opioids, Sessions said.

Arrests were made in cities including Chicago, Detroit, Los Angeles and Miami, as well as in southern Florida, which is home to hundreds of residential drug addiction treatment centers.

In addition to the Sheppard case, the Indiana attorney general’s office announced these indictments:

—Raymond E. Massengill, who operated Patient Access Transportation and with business locations in Marion County and Johnson County, was 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.

—In Evansville, chiropractor Mitchel Stukey and Karen Poeling of Med 1st are accused of distributing and prescribing controlled substances using signed blank prescription pads, then attempting to launder the money. As the result of a nearly five-year investigation, Stukey and Poeling face five counts of health care fraud; conspiracy to violate the Controlled Substance Act; and conspiracy to commit money laundering. The alleged activities resulted in an estimated loss of $490,000 to the Indiana Medicaid program.

—Near Kokomo, Sunshine Transportation employees Shawn and Amanda McNew are accused of billing Medicaid nearly $449,000 for trips that were never taken. Both were charged with violating the federal anti-kickback statute.

—Near New Albany, three former employees of JM Autism (most recently known as “Total Spectrum”) were accused of conducting a money-laundering scheme. Those indicted are Janice Patterson, Tanesha Washington and Katerrell Kennedy.

—In Jeffersonville, three health care professionals employed by Physicians Primary Care PLLC are accused of conducting illegal activities such as distributing and prescribing controlled substances The indictment does not detail total damages to Medicaid.

—In Fort Wayne, Dr. James E. Ranochak and two pharmacists, Brent Losier and Charles Ringger, of North Anthony Pharmacy & Wellness Center were indicted for allegedly conspiring to distribute and dispense controlled substances without legitimate medical purpose and fraudulent billing.

The attorney general's office cautioned that the indicted individuals and businesses are innocent unless proven guilty.

Sessions called the collective action the "largest health care fraud takedown operation in American history" and said it indicates that some doctors, nurses and pharmacists "have chosen to violate their oaths and put greed ahead of their patients."

Among those charged are six Michigan doctors accused of a scheme to prescribe unnecessary opioids. A Florida rehab facility is alleged to have recruited addicts with gift cards and visits to strip clubs, leading to $58 million in false treatments and tests.

Officials said those charged in the schemes include more than 120 people involved in prescribing and distributing narcotics.

"They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves, often at the expense of taxpayers, but also feed addictions and cause addictions to start," Sessions said in prepared remarks.

Sessions said in his remarks that nearly 300 health care providers are being suspended or banned from participating in federal health care programs.
The Justice Department said the people charged were illegally billing Medicare, Medicaid, and the health insurance program that serves members of the armed forces, retired service members and their families. The allegations include claims that those charged billed the programs for unnecessary drugs that were never purchased or never given to the patients.

The health care fraud takedown comes as a fight brews in Congress over how much money to allot for opioid treatment and as Republicans spar over how to repeal or replace the ACA. Some Republicans want more funding to help states combat the opioid addiction epidemic, which is estimated to have killed 33,000 Americans last year.

This story will be updated.

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