Jody Sheffield of Austin, Texas, was a middle-aged manager of an outpatient toxicology testing facility. ADAR Labs, Inc., performed all kinds of medical testing for both private and government insurance members. Apparently, at some point, Sheffield noticed how many TRICARE patients passed through the clinic. And the wheels started turning.
Sheffield roped in three of his colleagues to help him squeeze the government: ADAR Group owner Erik Bugen and medical testing industry marketers Britt Hawrylak and Matthew Hawrylak, who were “financiers” of the ADAR Group, according to the DoJ press release.
Sheffield and Bugen started offering TRICARE patients a $50 WalMart gift card for their urine and saliva samples, which the Hawrlyaks helped conceal under the guise of an assistance program for hungry veterans. Once they had the samples, the criminal team paid off doctors to sign forms prescribing toxicology and DNA tests for patients they had never even seen. Eventually, the doctors just went ahead and gave ADAR stamps of their signatures, which Sheffield and others used to sign off on the frivolous medical testing.
“Beneficiaries did not see these doctors prior to obtaining the testing, did not receive test results, and did not know the purpose of their samples,” the DoJ clarified.
By billing TRICARE for tests on the saliva and urine samples they collected, Sheffield and his accomplices charged the Department of Defense for $36 million dollars in services. By the time the scheme collapsed, the government had paid $4.8 million dollars to ADAR Labs.
Jody Sheffield pleaded guilty to one count of conspiracy to commit healthcare fraud. His sentencing is scheduled for May 18th, 2015, where he could receive up to five years in prison, a quarter-million dollar fine, and an order to pay restitution to the federal government for the swindled money.