U.S. Attorney’s Office Commitment to Protecting Patients and Consumers from Health Care Fraud Leads to Exponential Growth in Prosecutions

Press Release

Spokane, Washington - Vanessa R. Waldref, United States Attorney for the Eastern District of Washington, announced that in the last several months, the office she leads prosecuted several significant cases that protected patients, consumers, and the community from health care fraud.

"Safe and affordable health care is critical for a thriving community. Healthcare is a multi-billion-dollar industry in the Inland Northwest, and fraudulent schemes divert public funds away from treating patients and drive up the cost of care for those that need it most," said U.S. Attorney Waldref. "Combatting health care fraud is a priority for my office because everyone deserves to have doctors and medical providers who place patient care over profits."

In August of 2023, Lincare Holdings, Inc., agreed to pay $29 million to resolve allegations that it fraudulently overbilled Medicare and Medicare Advantage Plans for oxygen equipment. The settlement is the largest-ever health care fraud settlement in the Eastern District of Washington. In addition to the $29 million paid by Lincare to address claims that Lincare submitted to Medicare and Medicare Advantage, in what is believed to be a first-of-a-kind False Claims Act Settlement, as part of the settlement, Lincare agreed to identify and repay Medicare beneficiaries who were overcharged co-pays. Pursuant to this provision, as of September 2024, Lincare has refunded payments to 4,917 patients for a total of $976,137. If patients believe that they may have been overbilled for oxygen equipment and have not received a refund, they can reach out to the United States Attorney's Office of Public Affairs.

Other major health care fraud cases filed or pending in the Eastern District of Washington include:

August 2024 sentencing of Thomas Andrew Webster, M.D., age 51, of Sylvania, Ohio, for conspiring to accept kickbacks in connection with a fraudulent telemarketing and medical supply scheme throughout Washington and in other states. Dr. Webster was sentenced to two years in federal prison followed by 3 years of supervised release, restitution of more than $870,000, an additional criminal fine of $50,000, and forfeiture of hundreds of thousands of dollars in assets.

In August 2024, Justin Leland agreed to pay $224,620.88 to resolve allegations he participated in a kick-back scheme to bill Medicare for medically unnecessary durable medical equipment.

In August 2024, William O. Mize pled guilty to conspiracy in connection with a scheme to defraud insurance companies of more than $6 million by submitting fraudulent claims for health care and other injury expenses in connection with a series of vehicle collisions and other accidents staged by Mize and his co-conspirators. Mize is scheduled to be sentenced in November 2024.

In March 2024, Physician Staffing Company Jackson & Coker Locums Tenens, LLC and Physician Edward William Salko, D.O. agreed to pay $700,000 to resolve allegations that they participated in a kick-back scheme to bill Medicare for medically unnecessary durable medical equipment and diagnostic laboratory testing.

In January 2024, Physician Daniel Case agreed to pay $95,000 to resolve allegations that he participated in a kick-back scheme and ordered medically unnecessary durable medical equipment that Case caused to be billed to Medicare, Medicaid, and other federal health care programs

In January 2024, the United States and State of Washington filed a Complaint in federal district court against MultiCare Health System, which owns and operates MultiCare Deaconess Hospital and MultiCare Rockwood Clinic in Spokane, alleging that MultiCare knowingly endangered patient safety and falsely and fraudulently billed Medicare, Medicaid, and other federal health care programs for spinal surgery procedures performed at Deaconess between 2019 and 2021 by Jason Dreyer, a former neurosurgeon.

U.S. Attorney Waldref highlighted the importance of partnerships in combatting health care fraud, "We are prosecuting more cases because of our strong relationships with state and federal law enforcement partners - including Health and Human Services, Office of Inspector General; the Drug Enforcement Administration; the Department of Veterans Affairs, Office of Inspector General; and our state partners at the Washington State Office of the Attorney General's Medicaid Fraud Control Division, as well as many others. Our vigorous fraud practice holds individuals and corporations accountable for stealing from taxpayers. I am proud that my office is a national leader in fighting fraud and investigating cases brought by whistleblowers to report misconduct and protect our community's resources."

"The VA Office of Inspector General is committed to safeguarding the integrity of VA's healthcare programs and services and ensuring veterans receive the quality health care they deserve," said Special Agent in Charge Dimitriana Nikolov with the Department of Veterans Affairs Office of Inspector General's Northwest Field Office. "The VA OIG is grateful to the U.S. Attorney's Office and our law enforcement partners for their dedication and support in this case."

"The Defense Criminal Investigative Service (DCIS) is committed to working with our law enforcement partners to protect the integrity of federal healthcare programs, particularly as it relates to the Department of Defense's TRICARE program," said Bryan D. Denny, the Special Agent in Charge of the DCIS Western Field Office. "We will aggressively pursue and seek to hold accountable bad actors who defraud or attempt to defraud TRICARE, because their deceptive actions ultimately harm those defending our country and their families."

"The Drug Enforcement Administration works hard to ensure patient safety by regulating medical professionals who prescribe, produce, or dispense scheduled prescription drugs," said David F. Reames, Special Agent in Charge, DEA Seattle Field Division. "DEA holds medical personnel accountable when they fail to follow Federal law and regulations for scheduled medications and risk the health and safety of patients and our community."

In addition to casework, the U.S. Attorney's Office is engaged in community outreach to raise awareness about fraud schemes and educate members of the community on how to avoid becoming a victim of scams. U.S. Attorney Waldref has recorded this message about how we can all protect ourselves and our loved ones from scams targeting the elderly. To learn more about the Justice Department's elder justice efforts please visit the Elder Justice Initiative page.

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Updated November 12, 2024