Four men with North Texas ties have been implicated in a massive healthcare fraud scheme involving about $1.3 billion in false billings to government providers.
More than 400 people have been charged in the collective action, U.S. Attorney General Jeff Sessions said Thursday, calling it the “largest healthcare fraud takedown operation in American history.”
In North Texas, authorities said four men are accused of bribing individuals with Wal-Mart gift cards to entice them to contribute urine and saliva specimens that were used to generate more than $36 million in billings for fraudulent medical tests.
Erik Bugen, 42, Jody Sheffield, 43, Matthew Hawrylak, 41, and Britt Hawrylak, 38, were charged in the scheme involving unnecessary tests billed to TRICARE, the health insurance program that serves members of the armed forces, their families and retired service members, the U.S. attorney’s office for the Northern District of Texas said. The Hawrylaks are Tarrant County residents, while Sheffield and Bugen live in Travis County, according to a court document.
Government attorneys allege that Bugen and Sheffield paid doctors a monthly fee to sign orders for toxicology and DNA cancer screenings for people whom those doctors never met or examined and who never received the results from the fraudulent testing.
Bugen and Sheffield gave Wal-Mart gift cards — which they disguised as a food assistance program for low-income beneficiaries — to the individuals supposedly being tested in exchange for urine and saliva specimens, according to a court document filed Wednesday in the case.
All four men are also accused of operating an alcohol and drug addiction group in Killeen to further their scheme. Employees there collected urine and saliva samples from up to 200 people a day and placed false diagnosis codes on TRICARE claim submissions, authorities said.
Britt Hawrylak operated Tiger Racing Team, a shell company in Fort Worth, and Matthew Hawrylak operated Zorin Holdings, a separate shell company also in Fort Worth, as a part of the plot, the government alleges in a document filed in federal court. Each defendant faces up to five years in federal prison and a $250,000 fine.
An attorney representing the accused did not immediately responded to a request for comment.
Among those charged elsewhere in the country 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 illegally prescribing and distributing narcotic painkillers. Such prescription opioids are behind the deadliest drug overdose epidemic in U.S. history. More than 52,000 Americans died of overdoses in 2015 — a record — and experts believe the numbers have continued to rise.
“In some cases, we had addicts packed into standing-room-only waiting rooms waiting for these prescriptions,” acting FBI Director Andrew McCabe said. “They are a death sentence, plain and simple.”
The people charged were illegally billing Medicare, Medicaid and TRICARE, the Justice Department said. The allegations include claims that those charged billed the programs for unnecessary drugs that were never purchased or given to the patients.
Nearly 300 healthcare providers are being suspended or banned from participating in federal healthcare programs, Sessions said.
“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.
Healthcare fraud sweeps like Thursday’s happen each year across the country, but law enforcement officials continue to grapple over the best way to fight the problem.
This report includes material from The Associated Press.