Pennsylvania Medics in $1.4bn Scam: Couple Pleads Guilty to Massive Fraud Scheme

Story by Zainuddin Harinder
HARRISBURG, PA — Two Pennsylvania physicians have admitted involvement in a jaw-dropping healthcare fraud scheme. John H. Johnson and Paula Z. Johnson, both 62, pleaded guilty Monday to a conspiracy to defraud the United States. In addition, John Johnson has also admitted guilt to a charge of conspiracy to commit health care fraud.
This sensational story unfolded in Hollidaysburg, Pennsylvania, with the couple caught in a web of deceit and illegitimate activities. Trained in anesthesiology, John Johnson is the chief architect of the fraudulent scheme. He, along with several others, including Rodney L. Yentzer, conned health insurance programs with fake billing for pricey urine drug tests.

The expansive scheme stretched across several pain management practices in central Pennsylvania, known as Lighthouse Medical and Pain Medicine of York (PMY). Yentzer, an individual with no medical training, became the owner of PMY at the suggestion of John H. Johnson. The plot thickened when PMY absorbed Lighthouse Medical in 2017 and eventually shuttered operations in 2019 when law enforcement agents swooped in.

In essence, the scheme revolved around so-called “urine drug tests,” performed at a laboratory in the Lighthouse Medical facilities, under John H. Johnson’s supervision. These tests, though a legitimate tool for doctors to check patients’ substance intake, were gruesomely misused in the Johnson case. A staggering proportion of their patients were given opioid medications at each visit, with the tests serving as a lucrative means of checking their adherence or additional illegal drug usage.
The fraudsters hit a gold mine when they struck a deal with a rural, 25-bed “Critical Access Hospital” near the Florida-Alabama line. Lighthouse Medical’s urine drug testing services were ‘sold’ to the hospital in return for exclusive billing rights to patients and insurance programs, and a whopping $900 kickback per test.

Through clever manipulation of federal law provisions, the hospital hit paydirt with reimbursements from Medicare and private insurance programs despite the hefty kickbacks being paid to Lighthouse Medical. These kickbacks added up a staggering $2,341,775 over just four months.

During this entire saga, the Johnson couple meticulously planned and evaded payments to the U.S. Government, which John H. Johnson was obligated to make for a previous criminal conviction. In an interesting twist, John H. Johnson, fully aware of a probable prison sentence for his past offenses, placed his wife, Paula Z. Johnson, on the PMY payroll through Yentzer.
Even after his imprisonment, Johnson and Yentzer stayed connected through phone calls and visits, employing coded language to discuss their affairs. The term “toy” was used for money and “toy box” for bank accounts. Although imprisoned, John H. Johnson was well aware that the testing lab, PMY, was still a moneymaking machine due to their urine drug test billing.

Despite the impending doom, the Johnson couple, along with Yentzer, found cunning ways to siphon off wealth from PMY to evade seizure for John H. Johnson’s overdue restitution payments. This fraudulent wealth was used to purchase cars, make contributions to their children’s college funds, pay legal bills, and even cover significant loans.

The curtains came down on PMY abruptly in November 2019, after search warrants were executed due to the lack of medical providers to see patients.
According to U.S. Attorney Gerard M. Karam, the Johnsons’ fraudulent activities have dealt a tremendous blow to the pillars of trust and integrity that underpin our health care system. The consequences will soon follow, as a conviction for conspiracy to defraud the United States can bring five years in prison, a supervised release term, and a fine. The conspiracy to commit health care fraud carries a stiffer punishment: up to ten years’ imprisonment, a supervised release term, and a fine.

The case exposes the dark underbelly of the healthcare industry, reminding the public that even revered professionals can succumb to greed and deceit. It also serves as a stark indication that healthcare fraud is a serious crime that can be perpetrated even by those entrusted with our care, and underlines the vigilant and tireless work of the investigating agencies in bringing these fraudsters to justice.
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