Man admits role in $4.6M Medicare scheme

April 7, 2021 Cranberry Local News


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A Mars man pleaded guilty in federal court last week for his role in a $4.6 million Medicare scheme in which he received kickbacks from laboratories in exchange for patient DNA samples and genetic testing, the Justice Department said.

Jeremy Richey, 40, pleaded guilty March 29 to one count of conspiracy to violate anti-kickback statutes, according to court records.

Richey and five others were indicted Sept. 25, 2019, and were charged with accepting at least $1.8 million in bribes over a one-year period from labs where the group referred samples for testing.

Richey, who will be sentenced in August, faces up to five years in prison and a fine of $250,000.

According to the U.S. Attorney's Office in New Jersey, which prosecuted the case, Richey and some of the others owned Ark Laboratory. Prosecutors said the group used the lab to conceal kickback payments by issuing fraudulent invoices to labs, based on how much the labs received in payments for each sample.

Medicare reimbursed the labs about $4.6 million for tests connected to the referrals.

The payments occurred from January 2018 to January 2019, court records show.

According to the indictment, Richey and the other defendants used Ark to submit referrals for genetic tests and patients' DNA samples to various clinical laboratories across the country.

Richey and his conspirators got kickbacks from those laboratories with the agreement that the laboratories paid Ark bribes in exchange for delivering DNA samples and orders for genetic tests.

The indictment said Ark concealed these kickback arrangements by issuing false invoices to laboratories that purportedly reflected services provided at an hourly rate, even though the parties already had agreed upon the bribe amount, which was based on the revenue the laboratories received from Medicare or an amount paid for each DNA sample.

Medicare paid these laboratories at least $4.6 million for genetic tests and, in turn, the laboratories paid Ark at least $1.8 million in bribes.

Co-defendants Kacey C. Plaisance of Altamonte Springs, Fla.; Kyle McLean of Arlington Heights, Ill.; and Edward Kostishion of Lakeland, Fla., previously pleaded guilty.

The other co-defendants, Matthew Ellis of Gainesville, Fla., and Jeffrey Tamulski of Tampa, Fla., have ongoing cases and neither of them have pleaded guilty.

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