Amtrak OIG-supported investigation leads to guilty plea in pass-through billing scheme

November 06, 2019 |  Investigations Press Release

For Immediate Release

November 6, 2019

JACKSONVILLE, Fla. – The former CEO of a Missouri hospital pleaded guilty Oct. 29, 2019, for his role in perpetrating a pass-through billing scheme in which the hospital was used to submit fraudulent claims for toxicology and blood testing, resulting in approximately $114 million in payments from insurance companies and Missouri Medicaid.


David Lane Byrns, 62, of Lighthouse Point, Florida, the former CEO of Putnam County Memorial Hospital in Missouri, pleaded guilty to a one-count information charging him with conspiracy to commit health care fraud. The case was transferred from the Western District of Missouri to the Middle District of Florida by consent for the entry of Byrns’ plea. As part of his guilty plea, Byrns agreed to a forfeiture judgment of $5.1 million.


According to his guilty plea, Byrns and others, including a laboratory owner, arranged for urine drug tests and blood tests to be performed on a massive scale at diagnostic testing laboratories outside Missouri for individuals who were not Putnam patients and who had no connection to the hospital. Many of the tests conducted were medically unnecessary, and most of the tests did not take place at Putnam. Putnam, however, served as a pass through, fraudulently billing insurance companies and Missouri Medicaid for the tests as if they had been performed at the hospital.


To obtain samples for testing, Byrns and his co-conspirators worked with marketers who solicited samples from substance abuse treatment centers, sober living homes, physicians’ offices and other sources throughout the United States, in exchange for a portion of the insurance reimbursements. During a 15-month period, Putnam was reimbursed approximately $114 million by private insurers and the Missouri Medicaid program for the tests, and most of the reimbursement payments were shared among Byrns and his co-conspirators, including the laboratories, marketers and billing companies involved in the scheme.


Putnam billed Amtrak’s health plans more than $52,000. Byrns is the second CEO/company owner to plead guilty in this case. To date, Amtrak’s health care plans have been billed in excess of $900,000 through similar schemes perpetrated at rural hospitals and related labs.


Agents from Amtrak’s Office of Inspector General, along with the FBI’s Jacksonville Field Office; the Jefferson City, Missouri, Resident Agency of the FBI’s Kansas City Field Office; the U.S. Office of Personnel Management OIG; and the U.S. Department of Labor OIG investigated the case.


More information is available in the U.S. Attorney’s Office press release:…

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