Owner of Rainbow Center for Children Pleads to Defrauding TennCare of More Than $300,000

Memphis, TN – The owner of a grief counseling and psychotherapy services provider has pleaded guilty to defrauding TennCare of more than $300,000. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced the guilty plea today.

According to information presented in court, Vicky Fox, 53, of Memphis, Tennessee, owned and operated the Rainbow Center for Children and Adolescents. The establishment provided grief counseling and psychotherapy services to children and families in the Memphis area.

The Rainbow Center contracted with TennCare, the Tennessee-based program of Medicaid, from 2008 through 2013 and 2015. Under the contract, the Rainbow Center employed Licensed Clinical Social Workers (LCSWs) to provide counseling services. One of the LCSWs, Lillie Hughey, worked for the establishment until January 2012. After Hughey left the Rainbow Center, Fox used her former employee’s provider number and information to bill TennCare for counseling services that were never provided.

In August 2014, the Tennessee Bureau of Investigation (TBI) received a referral from the Bureau of TennCare, Program Integrity Unit (PIU) regarding a fraud investigation involving the Rainbow Center. The investigation revealed that Fox’s fraudulent claims scheme defrauded TennCare of more than $300,000.

On Friday, August 19, Fox pleaded guilty before U.S. District Judge John T. Fowlkes Jr. to one count of health care fraud.

Fox is scheduled to be sentenced onNovember 18, 2016. She faces up to 10 years in federal prison and a fine of up to $250,000.

This case is being investigated by TBI and the Bureau of TennCare.

Assistant U.S. Attorney Damon Keith Griffin is prosecuting this case on the government’s behalf.