KILLEEN, Texas (KWTX) A Killeen medical supply company owner and the company’s office manager were found guilty in a Waco federal court Tuesday in connection with a $3.5 million health care fraud scheme.
The jury in visiting U.S. District Judge Alia Moses’ court found DTS Medical Supply Company owner Daniel Thomason Smith, 55, and office manager Kathleen Marina Kelly-Tuorila, 45, guilty of initiating a health care fraud scheme that netted the pair more than $3.5 million over almost four years.
Moses remanded both to federal custody to await sentencing but did not set a sentencing date, court records showed.
The jury convicted both defendants on one count of conspiracy to commit health care fraud, one count of
aiding and abetting health care fraud, eleven counts of aiding and abetting aggravated identity theft and eight
counts of aiding and abetting false statements related to a health care matter.
Both Medicare and Medicaid provide qualified beneficiaries with financial remuneration for the purchase of
prescribed and necessary medical equipment, such as powered wheelchairs, powered scooters and accessories related to those two devices.
Evidence presented during trial showed that that between May 2006 and January 2010, the defendants
conspired to submit numerous false and fraudulent benefit claims to Medicaid and Medicare seeking compensation for powered wheelchairs.
Testimony showed that Smith employed Haigler on a commission basis to recruit customers primarily in the Waco area.
Kelly-Tuorila used the collected customer information from Haigler to generate and submit fraudulent claims for reimbursement to Medicaid and Medicare for powered wheelchairs.
Names of physicians were used to support claims for reimbursement when the named physician never prescribed a powered wheelchair for the customer and, in some instances, didn’t even know the customer and had never had them as a patient.
Evidence also showed that even though DTS billed for powered wheelchairs, they delivered less-expensive powered scooters to customers, which resulted in a larger payment from Medicaid/Medicare and a larger percentage of profit for DTS and Smith.
Each could be sentenced up to 10 years in federal prison on the conspiracy counts, up to 10 years each on the aiding and abetting Health Care Fraud count; up to two years for each aggravated identity theft count and up to five years in federal prison for each false statement count.
A third defendant in this case, Robin Renee Haigler, 60, of Waco, pleaded guilty to the conspiracy charge on August 17, 2015 and is set for sentencing in September.
She is free on bond.