A second physician pleaded guilty Tuesday in connection with a scheme to defraud workers’ compensation insurers tied to a Rogers medical supply and billing company.
Robert Clay Smith, 60, of Alexandria, Louisiana, waived indictment by a grand jury and pleaded guilty to charges of conspiracy to commit health care fraud, wire fraud and taking kickbacks. He made more than $650,000 from the scheme, according to a news release from U.S. Attorney David Clay Fowlkes of the Western District of Arkansas.
Smith faces up to five years in federal prison.
The basic premise of the scheme, which ran from 2013 until 2017 was that people associated with Common Compounds Inc., also known as CCI Billing, recruited Smith to dispense pain creams and patches to his workers’ compensation patients by offering him a split of the profits, according to court records.
CCI acted as the billing agent for Smith, handling all the paperwork and submitting the allegedly fraudulent claims to the U.S. Department of Labor and the Office of Workers’ Compensation Programs, which covers all federal employees, and private insurers, according to court documents.
In exchange, Smith admitted, the company paid him 50% to 55% of the profits collected from successfully billing insurers at markups of 15 to 20 times what the medications actually cost, the news release said.
“Smith admitted that in addition to receiving illegal kickbacks, he knew he did not have a license to dispense medications from his clinic, required under Louisiana law, and nonetheless bought topical medications from the Rogers company and dispensed them to his workers’ compensation patients from his clinic,” according to the news release.
On Feb. 28, the former owner of CCI and its former CEO were indicted by a federal grand jury on 12 counts in connection with a kickback scheme involving several doctors and medical clinics.
Hunter Matthew Burroughs, who owned CCI, and Stephen Keith Andrews, CCI’s former CEO, were charged with one count of conspiracy to commit health care fraud, two counts of conspiracy to commit wire fraud and eight counts of wire fraud. Burroughs, who sold CCI in 2017, is also charged with another wire fraud count.
In July, Dr. Robert Dale Bernauer Sr., who ran a clinic in Lake Charles, Louisiana, pleaded guilty to his role in the conspiracy. He has not been sentenced.
CCI’s former billing director, Amanda Dawn Rains, pleaded guilty in October to participating in criminal conspiracies with the two doctors, and others, the news release said. She is scheduled to be sentenced on Aug. 19 in U.S. District Court in Fayetteville.
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