A federal jury convicted a Kentucky doctor, a Texas businessman, and a Kentucky woman for their roles in operating a scheme out of a series of addiction treatment facilities in Kentucky that fraudulently billed Medicare and Kentucky Medicaid for over $8 million.
According to court documents and evidence presented at trial, Dr José Alzadon, 61, of Paintsville, Kentucky; Michael Bregenzer, 52, of Richmond, Texas; and Barbie Vanhoose, 62, of West Van Lear, Kentucky, orchestrated their health care fraud scheme through Kentucky Addiction Centers (KAC), which operated in Winchester, Paducah, Paintsville, and London, Kentucky.
As part of his role as KAC’s medical director, Alzadon prescribed Suboxone, a controlled substance that can be used to treat opioid addiction when properly prescribed under regulations issued by the Drug Enforcement Administration (DEA).
Bregenzer served as KAC’s CEO and Vanhoose as KAC’s billing manager.
Together, Alzadon, Bregenzer, and Vanhoose ran a scheme that falsely billed taxpayer-funded health programs like Medicare and Medicaid for medical services that were not performed or were falsely represented as more complex than the services provided.
They also conspired to falsely bill for services in the name of Alzadon’s elderly father, using Alzadon’s father’s identity to bypass insurance credentialing issues that Alzadon had and to use Alzadon’s father’s DEA prescribing credentials to prescribe Suboxone even though Alzadon’s father had not seen the patients for whom he was supposedly issuing prescriptions.
Alzadon, Bregenzer, and Vanhoose were each convicted of one count of conspiracy to commit healthcare fraud, eight counts of healthcare fraud, and one count of conspiracy to distribute controlled substances using the DEA registration number of another person.
They face a maximum penalty of ten years in prison on each health care fraud conspiracy and substantive health care fraud count and four years in prison on the conspiracy to distribute controlled substances count.
Alzadon and Vanhoose were also each convicted of two counts of aggravated identity theft and face a consecutive mandatory minimum of two years in prison. Alzadon and Bregenzer are scheduled to be sentenced on June 25, and Vanhoose is scheduled to be sentenced on June 26.
