21 Charged, Including Hospital and Lab CEOs, in Connection with Multistate Healthcare Kickback Conspiracy
TEXARKANA, Texas – A Coronado, California, man has been found guilty of federal violations related to a health care kickback scheme in the Eastern District of Texas, announced U.S. attorney Brit Featherston today.
Vincent Marchetti, Jr., 57, was found guilty by a jury following a month-long trial before U.S. District Judge Robert W. Schroeder, III.
“Fraud on our health care system cost taxpayers millions of dollars,” said U.S. Attorney Brit Featherston. “The defendant convicted today, and the others prosecuted in this large conspiracy, will suffer their fate at the hands of our excellent justice system. All should know that an investigation and prosecution such as this takes thousands of hours of work by law enforcement and prosecutors. My hat goes off to them for their excellent work to protect the citizens of our communities.”
“Kickback schemes victimize patients seeking legitimate care and line the pockets of criminals who pay or receive them,” said Miranda L. Bennett, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General, Dallas Region. “We will continue working with our law enforcement partners to protect the integrity of federal health care programs by exposing these harmful schemes and holding fraudsters accountable.”
“The defendant intentionally deceived the health care system to receive unlawful benefits and payments. Health care fraud causes billions of dollars in damages a year and affects patients by raising their premiums and taxes,” said FBI Dallas Special Agent in Charge Matthew DeSarno. “The FBI will continue working alongside our public and private sector partners to pursue individuals who attempt to profit off of patients and insurance holders.”
“Those involved in kickback schemes and fraudulent business enterprises will eventually face justice no matter where they operate,” said Christopher Miller, acting Special Agent in Charge, HSI Dallas. “We remain relentless in our pursuit of those who violate the law through fraudulent practices for personal gain.”
According to information presented in court, Marchetti conspired with others to pay and receive kickbacks in exchange for the referral of, and arranging for, health care business, specifically pharmacogenetic (PGx) tests. Pharmacogenetic testing, also known as pharmacogenomic testing, is a type of genetic testing that identifies genetic variations that affect how an individual patient metabolizes certain drugs. The illegal arrangement concerned the referral of PGx tests to clinical laboratories in Fountain Valley, California; Irvine, California; and San Diego, California. More than $28 million in illegal kickback payments were exchanged by those involved in the conspiracy.
In December 2019, twelve individuals from three states were charged for their roles in the kickback conspiracy. A federal grand jury in the Eastern District of Texas returned an indictment against Philip Lamb, 46, of Scottsdale, Arizona; Nicolas Arroyo, 40, of Tempe, Arizona; Vincent Marchetti, Jr.; William Flowers, 56, of Houston; Steven Donofrio; James J. Walker, Jr. a/k/a Jimmy Walker, 47, of Frisco; Timothy Armstrong, 64, of Frisco; Virginia Blake Herrin, 56, of Frisco; Patrick Ridgeway, 52, of Jackson, Mississippi; Chismere Mallard, 41, of McAllen; Dr. Ray W. Ng; and Ashley Kretzschmar, 36, of Aledo; for conspiring to commit illegal remunerations in violation of the Anti-Kickback Statute.
Philip Lamb, Nicolas Arroyo, Jimmy Walker, Virginia Blake Herrin, Patrick Ridgeway, Chismere Mallard, and Ashley Kretzschmar pleaded guilty prior to trial.
Kimberly Willette, 59, of Friendswood, and Edwin Chad Isbell, 48, of McKinney, also pleaded guilty to related charges.
The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remunerations in exchange for the referral of or arranging for or recommending the ordering of items or services payable under federal health care programs. Under federal statutes, violations of the Anti-Kickback statute are punishable by up to five years in federal prison.
This case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General, the FBI Dallas – Frisco Resident Agency, and the U.S. Department of Homeland Security, Homeland Security Investigations. It was prosecuted by Assistant U.S. Attorneys Nathaniel C. Kummerfeld, Lucas Machicek, Adrian Garcia, Brent Andrus, and L. Frank Coan, Jr., with assistance from Assistant U.S. Attorney Stephan E. Oestreicher, Jr., and Special Assistant U.S. Attorney Laurel E.P. Simmons.