Five convicted of healthcare kickback conspiracy involving Central Texas hospital

TYLER, Texas — Five defendants have been convicted of participating in a healthcare kickback conspiracy involving a Central Texas hospital, according to the United States Attorney’s Office, Eastern District of Texas, including the former CEO of the hospital.

According to the Attorney’s Office, Susan L. Hertzberg, 65, of New York, New York; Matthew John Theiler, 57, of Mars, Pennsylvania; David Weldon Kraus, 65, of Loudon, Tennessee; Thomas Gray Hardaway, 51 of San Antonio, Texas; and Jeffrey Paul Madison, 48, of Georgetown, Texas, were found guilty on Nov. 30, 2023, of conspiring to violate the Anti-Kickback Statute.

Madison is the former CEO of Little River Healthcare, based in Rockdale, TX, which also has a location in Temple, TX.

The Attorney’s Office stated the five defendants, along with several others, were indicted on Jan. 12, 2022, for “conspiring to commit illegal remunerations in violation of the Anti-Kickback Statute”, which prohibits “offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federal health care programs”.

The defendants were allegedly charged with participating in a conspiracy in which physicians were incentivized to make referrals to rural hospitals and an affiliated lab in exchange for kickbacks disguised as investment returns. Marketers were also allegedly incentivized to arrange for or recommend the ordering of services from the hospitals and lab.

Source: Five convicted of healthcare kickback conspiracy involving Central Texas hospital / KCEN TV

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