Jackson, Mo. man sentenced to 2.5 years, ordered to pay $7.5M in health care fraud scheme

CAPE GIRARDEAU COUNTY, Mo. (KFVS) - A Jackson man was sentenced to 2.5 years in prison and ordered to pay $7.5 million for health care fraud scheme.

Business owner Jamie McCoy, 42, pleaded guilty on November 23, 2020 to three felony counts: health care fraud, make false statements related to health care matters and offering and paying illegal kickbacks for referrals.

According to a release from the U.S. Attorney for the Eastern District of Missouri, he admitted to owning or operating companies that supplied orthotic braces and other durable medical equipment: AE Wellness LLC, Summit Medical Supply, Patriot Medical Supply and DME Devices Co.

They say he contracted with marketing firms who placed ads on television and online that offered orthopedic braces at no cost. The companies sent patient information to a telemedicine doctor who signed an order medical equipment without evaluating, nor communicating, with the patient in some cases, McCoy’s plea agreement says.

Those leads, consisting of the patient information and the medical equipment order, were then sold to DME companies.

McCoy admitted paying 70 percent to 80 percent of his profits to one person who supplied leads to AE Wellness. According to the release, another received $35-$40 for leads without a doctor’s order and $280-$300 for a “full lead.”

From September 2016 to August 2017, according to the attorney’s office, AE Wellness submitted $6 million in reimbursement claims to Medicare for DME and $67,955 to Tricare. Patriot Medical Supplies billed Tricare $23,951.

McCoy admitted knowing Medicare, Medicaid and Tricare, which reimburses for health care services provided to current and former members of the military and their families, would not pay for items obtained by paying illegal kickbacks.

After AE Wellness was suspended in 2017 for paying illegal kickbacks, the release states McCoy, AE’s office manager Brandy McKay and Jackson Preston Siples III, who ran day-to-day operations at AE, opened new DME companies. They concealed McCoy’s role, and continued to pay kickbacks for referrals and leads, McCoy’s plea agreement stated.

From June 5, 2018 to March 21, 2019, McCoy and McKay submitted $1.8 million in fraudulent reimbursement claims to Medicare and $15,540 to Tricare on behalf of a company known as MC Medical. From March 8, 2018 to March 13, 2019, Siples admitted $6 million in fraudulent reimbursement claims to Medicare and $145,614 to Tricare on behalf of a company known as Integrity Medical Supply.

Siples submitted $922,562 in false claims to Medicare from March 5, 2019 to March 27, 2019 on behalf of Radiance Health Group.

According to the district attorney’s office, McKay went on to manage a series of companies that continued the scheme.

“Submitting false claims for medically unnecessary equipment diverts funding from the necessary services required to support beneficiaries of federal health care programs,” stated Curt L. Muller, special agent in charge with the Department of Health and Human Services, Office of Inspector General. “OIG will continue to work with our law enforcement partners to identify and hold accountable individuals who choose to waste vital taxpayer dollars by participating in health care fraud schemes.”

McKay was sentenced January 18 to three years in prison and ordered to repay $7.5 million.

Siples pleaded guilty in May to the same charges as McCoy and is awaiting sentencing.

The Department of Health and Human Services Office of Inspector General, the FBI, the Defense Criminal Investigation Service and the Missouri Medicaid Fraud Control Unit investigated this case. Assistant U.S. Attorneys Dorothy McMurtry and Derek Wiseman are prosecuting the case.

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