Florida man pleads guilty in $42 million Medicare fraud case

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Florida Medicare fraud guilty plea

Highlights

Chad Monroe pleads guilty to conspiracy to commit health care fraud and wire fraud involving over $42 million in illegal Medicare and TRICARE claims.
Monroe and co-conspirators used Maksix Medical Products Inc., Orthotech Atlanta, LLC, and 1st Choice Medical Supply LLC to submit more than $26 million in false claims and received over $15 million in kickbacks.
Authorities seized a $600,000 yacht, more than $1 million, and luxury vehicles; Monroe faces up to 40 years in prison, with sentencing to be determined.

Fraud scheme and guilty plea details

As reported by the U.S. Department of Justice, Chad Monroe, 48, of Tarpon Springs, Florida, pleads guilty to one count of conspiracy to commit health care fraud and one count of wire fraud in a case tied to durable medical equipment and cancer genetic testing claims.

According to court documents and statements made in court, Monroe conspires with others to submit fraudulent claims for items such as knee, wrist, ankle and back braces, along with cancer genetic testing that Medicare beneficiaries did not want or need. Prosecutors say Monroe and his co-conspirators open three DME companies, Maksix Medical Products Inc., Orthotech Atlanta, LLC, and 1st Choice Medical Supply LLC, and use them to submit more than $26 million in false claims to Medicare, Medicare Advantage plans and TRICARE.

Prosecutors say Monroe directs co-conspirators to lie on Medicare enrollment documents to conceal his ownership and role at the companies. To obtain doctors' orders for the equipment and genetic tests, he pays illegal kickbacks to purported telemedicine companies, and through Health and Life Networking LLC he sells genetic testing orders to co-conspirator laboratories that pay him more than $15 million in illegal kickbacks.

Monroe also pleads guilty to fraudulently obtaining a Paycheck Protection Program loan of more than $30,000. Prosecutors say he directs a co-conspirator to submit the application and misrepresent, among other things, the ownership of 1st Choice Medical Supply LLC to qualify for the loan.

Asset seizures and enforcement impact

Authorities say Monroe uses proceeds from the scheme to finance a lavish lifestyle, including a 47-foot yacht valued at more than $600,000 called "The Rogue Shark," a Cadillac Escalade and other luxury vehicles. In connection with the charges, the government seizes the yacht and more than $1 million.

A sentencing date is not yet set. Monroe faces a maximum penalty of 10 years in prison on the health care fraud conspiracy charge and 30 years in prison on the wire fraud charge, with a federal district court judge set to determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The announcement is made by officials from the Justice Department's National Fraud Enforcement Division, HHS-OIG, the FBI Tampa Field Office, DCIS Southeast Field Office and IRS Criminal Investigation's Florida Field Office. The case underscores continued scrutiny of Medicare billing, telemedicine-related kickbacks and misuse of pandemic-era business aid in the U.S. health care sector.

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