Monthly Spotlight on Fraud, Waste, and Abuse
The following cases highlight fraud, waste, and abuse (FWA) and serve as a reminder to uphold high ethical standards when providing patient care and services.
Mobile PET Scan Provider to Pay $8.33 Million to Resolve Allegations of False Claims Act Violations Based on Unlawful Kickbacks to Medical Practices
Modern Nuclear Inc. (MNI), a provider of mobile positron emission tomography (PET) scans headquartered in La Habra, California, has agreed to pay a total of $8,334,350.71, plus additional amounts based on future revenues, to resolve False Claims Act allegations that it paid referring cardiologists excessive fees to supervise PET scans in violation of the Anti-Kickback Statute (AKS). This settlement is based on MNI's ability to pay.
The United States alleged that between Sept. 1, 2016, and Jan. 14, 2025, MNI knowingly submitted false or fraudulent claims to federal healthcare programs arising from violations of the AKS. Specifically, MNI allegedly paid kickbacks to referring cardiologists in the form of above-fair market value fees, ostensibly for cardiologists to supervise PET scans for the patients they referred to MNI. The United States alleged these fees substantially exceeded fair market value for the cardiologists' services because MNI paid the referring cardiologists for time they spent in their offices caring for other patients or while they were not on site at all, or for additional services beyond supervision that were never or rarely actually provided. MNI purported to rely on an attorney-opinion letter regarding fair market value that the United States alleged was premised on fundamental inaccuracies and that the consultant ultimately withdrew.
In connection with the settlement, MNI entered into a five-year Corporate Integrity Agreement (CIA) with the HHS-OIG. The CIA requires, among other compliance provisions, that MNI implement measures designed to ensure that arrangements with referring physicians are compliant with the AKS. The CIA also requires that MNI implement a compliance program to identify and address the AKS risks associated with other financial arrangements and retain an Independent Compliance Expert to perform a review of the effectiveness of the compliance program.
The civil settlement resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act by two relators. Under those provisions, a private party or relator can file an action on behalf of the United States and receive a portion of any recovery. The relators will receive 16% of the total recovery in this matter.
The claims resolved by the settlement are allegations only; no determination of liability has been made.
Source: Mobile PET Scan Provider to Pay $8.33 Million to Resolve Allegations of False Claims Act Violations Based on Unlawful Kickbacks to Medical Practices. (2026, May 1). www.justice.gov
Vascular Practice and Physician Agree to Pay More Than $6.73 Million to Settle False Claims Act Allegations of Unnecessary Vascular Interventional Procedures
Serrano Kidney & Vascular Access Center, a physician practice based in Huntington Park, California, and physician Dr. Feliciano Serrano have agreed to pay more than $6.73 million to resolve allegations that they violated the False Claims Act by submitting false claims for medically unnecessary vascular interventional procedures on 20 Medicare beneficiaries.
The United States alleged that from 2016 to 2024, Dr. Serrano performed medically unnecessary dialysis access interventions, including angioplasty and stent procedures, on 18 patients, purportedly to treat stenosis in patients' dialysis segments. Dr. Serrano scheduled interventions on a routine basis, without waiting for complications to be present, and he frequently repeated procedures on patients every few days or weeks, despite the fact that the procedures were ineffective and did not result in any clinical benefit. One Medicare patient received approximately 42 stents in the dialysis segment between 2016 and 2023, including during a period when Dr. Serrano informed the patient that he did not need dialysis.
The United States also alleged that from 2019 to 2024, Dr. Serrano performed medically unnecessary peripheral artery disease interventions, including stent and atherectomy procedures, on 17 patients, purportedly to treat stenosis in patients' legs. Dr. Serrano performed interventions on patients who had only mild or no stenosis and minor symptoms. Although patients complained of pain only in one leg, he performed procedures on both legs and then repeated procedures on both legs every few months. Dr. Serrano told patients that if they did not receive the procedure, their legs would need to be amputated, when, in fact, there was little risk of amputation for mildly symptomatic peripheral artery disease. One Medicare patient received approximately 16 atherectomies in his legs between 2019 and 2023.
The United States alleged that across both categories of procedures, Dr. Serrano performed interventional procedures on vessels that did not qualify for treatment under accepted standards of medical practice; overstated the degree of stenosis to make the procedures appear to meet generally recognized medical standards when, in fact, they did not; falsely documented patient symptoms and conservative therapy measures in medical records to justify the procedures; and performed procedures in excess of accepted standards of medical practice.
As a result of the settlements, Dr. Serrano will pay nearly $6.51 million to the United States and nearly $229,000 to the State of California.
The civil settlement includes the resolution of claims brought by Lincoln Analytics Inc. under the qui tam or whistleblower provisions of the False Claims Act. Under the act, a private party can file an action on behalf of the United States and receive a portion of any recovery. Lincoln Analytics Inc. will receive approximately $976,000 as its share of the federal recovery.
The claims resolved by the settlement are allegations only; no determination of liability has been made.
Source: Vascular Practice and Physician Agree to Pay More Than $6.73M to Settle False Claims Act Allegations of Unnecessary Vascular Interventional Procedures. (2026, May 6). www.justice.gov
Brentwood Woman Pleads Guilty to Defrauding Taxpayers Out of $6.9 Million
A Tennessee woman pleaded guilty to her role in defrauding Medicare out of $6.9 million.
According to court documents, over a period of three and a half years, this optometric physician used her practice, Brentwood Eye Care, to submit false claims to Medicare. As an enrolled provider, she submitted false claims seeking reimbursements from Medicare for new wound care products she had not actually purchased or used because she split wound care products intended for single use.
For example, in May 2022, the woman, through Brentwood Eye Care, submitted claims to Medicare on behalf of two patients who were Medicare beneficiaries for placement of wound care products on May 20, 23, 24, 25, 26, and 27, when the appointment data showed that the patients had appointments on May 20, 24, and 27 only. She directed the staff at Brentwood Eye Care to create false records for the other dates to support the services fraudulently billed to Medicare.
In addition to her fraudulent Medicare claims, she also made false claims between March 2020 and October 2024 to TennCare, Tennessee's Medicaid agency, and Federal Employees Health Benefits programs.
As part of her guilty plea, she admitted that during her criminal conduct, she submitted false Medicare claims in the amount of approximately $11 million and received approximately $6.9 million.
She will be sentenced on September 10, 2026, and faces a maximum sentence of five years in federal prison.
Source: Brentwood Woman Pleads Guilty to Defrauding Taxpayers Out of $6.9 Million. (2026, May 7). www.justice.gov
Utah Doctor and Two Nurses Charged with Healthcare Fraud After Submitting False Claims to Medicare and Receiving Millions in Payout
A federal grand jury in St. George returned an indictment charging a Utah podiatrist and two nurses who worked for him with fraud after they allegedly submitted fraudulent claims to Medicare for skin substitute services, many of which were medically unnecessary, and resulted in Medicare paying $29 million in claims.
According to allegations in court documents, from July 2021 through December 2025, the trio allegedly defrauded Medicare to fraudulently obtain money for their own financial benefit.
Medicare is intended to provide healthcare benefits to individuals over the age of 65 or disabled. The podiatrist owned and operated Summit Foot and Ankle, with clinics throughout the state of Utah. He also owned and operated Amble Medical, located in Highland, Utah. One licensed registered nurse worked primarily out of Summit's St. George clinic. The other licensed nurse practitioner worked out of both locations.
As alleged, the trio knew Medicare billing of a skin substitute was permissible only if medically necessary and if basic wound care had been administered to a wound for the previous 30 days. However, the defendants submitted false claims to Medicare for providing skin substitutes to patients who did not have qualifying wounds and where continued treatment of skin substitutes was medically unnecessary. As part of their alleged scheme, the trio routinely did not pursue Medicare copayments from beneficiaries for skin substitutes, which, at times, would have been thousands of dollars owed by a Medicare beneficiary. The podiatrist also allegedly caused unqualified medical providers, such as the registered nurse, to provide skin substitute services that were outside their professional scope of practice. The podiatrist also submitted claims to Medicare for such skin substitutes under his name and Medicare provider number.
As a result, the podiatrist billed $44 million in claims to Medicare for skin substitutes, many of which were unnecessary, and Medicare paid Summit over $19 million on these claims. The nurse practitioner billed $17 million in claims to Medicare for skin substitutes, many of which were medically unnecessary, and Medicare paid Summit over $10 million on the submitted claims.
All three are charged with healthcare fraud and wire fraud. The podiatrist and registered nurse are also charged with false statements relating to healthcare matters. Their initial appearance on the indictment is scheduled for June 8, 2026.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Source: Utah Doctor and Two Nurses Charged with Health Care Fraud After Submitting False Claims to Medicare and Receiving Millions in Payout. (2026, May 12). www.justice.gov
CFO of Boston-Area Spinal Device Company Pleads Guilty to Kickback Scheme
The Chief Financial Officer of SpineFrontier, Inc., a spinal implant company, formerly based in Malden, Mass., pleaded guilty in connection with a kickback scheme to bribe surgeons to use company products in exchange for sham consulting fees.
The CFO pleaded guilty to one count of conspiracy to violate the Anti-Kickback Statute. The U.S. District Court Judge on the case scheduled sentencing for Aug. 6, 2026. The man was charged in September 2021, along with the company SpineFrontier, as well as SpineFrontier's Founder, President, and CEO.
The CFO paid and conspired to pay over $540,000 in bribes to surgeons in the form of sham consulting fees for work they did not perform. The CFO and CEO both bribed surgeons to use SpineFrontier's products, and in turn, SpineFrontier received millions of dollars in revenue from surgeries the surgeons performed.
The CFO entered into contracts with surgeons, agreeing to pay the surgeons between $250 and $1,000 per hour for purported consulting for SpineFrontier. However, the CFO and CEO paid the surgeons for using SpineFrontier's products. Although the surgeon-consulting program was purportedly directed at gathering technical feedback about SpineFrontier's products, the CFO used the bribes they paid pursuant to that program to induce surgeons to use SpineFrontier's products in surgeries that were paid for by federal healthcare programs such as Medicare, Medicaid, and Veterans Health Administration. Additionally, the surgeons frequently spent only a small fraction of their reported time, if any, performing actual consulting.
The CFO previously agreed to pay a fine pursuant to a civil settlement agreement, including a fixed amount totaling more than $150,000 (including interest) and agreed to additional potential contingency payments based upon his annual income.
In May 2025, the CEO pleaded guilty to making false statements to the Centers for Medicare and Medicaid Services. He was subsequently sentenced in August 2025 by the judge on the case to one year of supervised release with the first six months to be served in home confinement. The CEO was also ordered to pay a fine of $9,500, in addition to $40,000 he personally agreed to pay as part of a related civil settlement, and his wholly owned company agreed to pay $855,000 as part of the same settlement.
This plea also follows two guilty pleas in related criminal prosecutions. In August 2020, a surgeon from Mississippi pleaded guilty to conspiracy to violate the Anti-Kickback Statute and obstruction. A medical device distributor from Kansas pleaded guilty to conspiracy to violate the Anti-Kickback Statute and one count of witness tampering. They are scheduled to be sentenced in September 2026.
The charge of conspiring to violate the Anti-Kickback Statute provides for a sentence of up to five years in prison, three years of supervised release, a fine of $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greater, forfeiture, and restitution. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Source: CFO of Boston-Area Spinal Device Company Pleads Guilty to Kickback Scheme. (2026, May 12). www.justice.gov
Owner of Healthcare Software Company Convicted of $1 Billion Medicare Fraud Conspiracy
A federal jury in the Southern District of Florida convicted the founder and owner of HealthSplash for his role in operating a platform that generated false doctors' orders and prescriptions to defraud Medicare and other federal healthcare benefit programs out of more than $1 billion.
According to court documents and evidence presented at trial, a Kansas man and his co-conspirators aggressively targeted hundreds of thousands of Medicare beneficiaries to get them to accept medically unnecessary orthotic braces and other items. They then arranged for purported telemedicine doctors to sign bogus prescription orders for these items, so that their co-conspirators could bill Medicare for them. All told, the man and his co-conspirators billed Medicare and other federal healthcare benefit programs over $1 billion for this unnecessary equipment.
The man owned, controlled, and was the CEO of HealthSplash, which acquired Power Mobility Doctor Rx, LLC (DMERx) in September 2017. DMERx was an internet-based platform that generated false and fraudulent doctors' orders for durable medical equipment (DME) and prescriptions for other items. As part of the scheme, the man and his co-conspirators connected pharmacies, DME suppliers, and marketers with telemedicine companies that would accept illegal kickbacks and bribes in exchange for signed doctors' orders created using the DMERx platform. The man and his co-conspirators took a cut for themselves in exchange for the referrals.
The fraudulent doctors' orders and prescriptions generated by DMERx falsely represented that a doctor had examined and treated the Medicare beneficiaries when, in fact, the doctors were simply paid to sign orders and prescriptions without any meaningful interaction with the beneficiary, and in some cases, no interaction at all. Doctors signed these orders and prescriptions without regard to whether the equipment was medically necessary. Testimony and evidence presented at trial from an undercover agent who posed as a Medicare beneficiary showed the scheme in action—starting with a foreign call center that pushed the undercover agent to agree to multiple braces to a doctor signing bogus orders for the braces using the man's DMERx platform. The doctor's order for one of these undercover agent beneficiaries claimed that the doctor conducted various tests that can only be performed in person even though the doctor never even spoke with the undercover agent “patient.”
The DME suppliers and pharmacies that were paying illegal kickbacks for these orders billed Medicare and other insurers for more than $1 billion. Medicare and the other insurers paid more than $450 million based on these claims. According to evidence presented at trial, the man and his co-conspirators concealed the scheme through sham contracts and by manipulating the doctors' orders to avoid Medicare audits.
The jury convicted the man of conspiracy to commit healthcare fraud and wire fraud, conspiracy to pay and receive healthcare kickbacks, and conspiracy to defraud the United States and to make false statements in connection with healthcare matters.
Source: Owner of Health Care Software Company Convicted of 1 Billion Dollar Medicare Fraud Conspiracy. (2026, May 14). www.justice.gov
Sonal Patel, BA, CPMA, CPC, CMC, ICDCM, is CEO and Principal Strategist at SP Collaborative, LLC.