United States Attorney Adam L. Mildred announced a settlement for nearly $1.7 million to resolve civil claims that a former doctor defrauded the state of Indiana and the federal government.
Former physician Don J. Wagoner, age 89, of Burlington, Indiana, and his business entity, Wagoner Medical Center, L.L.C, allegedly defrauded benefit programs for years.
Court documents say that during 2011-2013, former physician Don J. Wagoner practiced medicine at Wagoner Medical Center, L.L.C., which Wagoner solely owned.
The Wagoner defendants had a routine practice of requiring patients seeking a prescription for opioid pills or other pain medicine to submit a urine sample for qualitative testing for the presence or absence of nine or more drugs or drug classes.
Using a multiplexed screening kit costing defendants no more than about 10 dollars, defendants tested each single urine sample for the same patient on the same day using the simple kit. Defendants then billed Indiana Medicaid and received $171.27 or more per patient, even though Indiana Medicaid billing rules only allowed them to bill $20.83 per patient.
Defendants concealed this fraud by falsely certifying to Indiana Medicaid that they had collected and separately analyzed nine or more urine samples from each patient, when in fact they had collected and analyzed one urine sample. Defendants perpetrated this fraudulent scheme for over 5,000 claims and received a total overpayment from Indiana Medicaid of nearly $1 million, which they refused to repay.
On December 29, 2017, the United States and the State of Indiana filed a Complaint under the False Claims Act to recover the overpayment resulting from the fraudulent scheme, and also civil penalties. The settlement announced today resolves that case.
The Indiana Medicaid program provides healthcare for low-income, often uninsured, Indiana residents who cannot otherwise afford needed medical care.
Indiana Medicaid is jointly funded by the United States and the State of Indiana.
The federal False Claims Act and the Indiana Medicaid False Claims Act allows the federal government and the State of Indiana to recover the amount of the false claims plus civil penalties. A small portion of recoveries under the federal False Claims Act, three percent, is used to fund the cost of future health care fraud investigations and cases.
In 2013, defendant Don J. Wagoner permanently surrendered his licenses to prescribe drugs and practice medicine in connection with a state criminal investigation of his opioid‑prescribing practices, which resulted in felony drug dealing convictions of Mr. Wagoner.
“Although they no longer are endangering vulnerable Medicaid patients by practicing medicine, former physician Don Wagoner cannot be allowed to retain the fruits of his fraudulent Medicaid claims,” said United States Attorney Adam L. Mildred. “The U.S. Attorney’s Office will continue to make it a priority to pursue investigations and cases to recover funds that were fraudulently received from the Medicare and Medicaid programs.”
The settlement was reached in a case against Don J. Wagoner and Wagoner Medical Center, L.L.C. filed by the United States Attorney’s Office for the Northern District of Indiana and the Indiana Medicaid Fraud Control Unit within the Indiana Attorney General’s Office. Lead counsel for plaintiff United States in this litigation and negotiation was Assistant United States Attorney Wayne T. Ault.
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