Doctor Sentenced for Conspiring to Accept Kickbacks in DME Scheme

WASHINGTON—Thomas Andrew Webster, M.D., age 51, of Sylvania, Ohio, pleaded guilty to conspiring to accept kickbacks in connection with a fraudulent telemarketing and medical supply scheme throughout Washington and in other states, announced Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington. United States District Judge Mary K. Dimke imposed a sentence of 24 months in federal custody to be followed by three years of supervised release, as well as restitution of $839,566.44. In addition, Dimke imposed a fine of $50,000.  

The Medicare program provides health insurance coverage for elderly and disabled Americans. The Department of Defense’s TRICARE program provides health benefits to United States Armed Forces military personnel, military retirees and their dependents. Medicare and TRICARE provide health insurance coverage for eligible health services, including, under certain conditions, for durable medical equipment (DME). Durable medical equipment are supplies ordered by a health care provider for a patient’s everyday or extended use, such as oxygen equipment, wheelchairs, crutches or blood testing strips for diabetics. For DME to qualify for reimbursement, the DME is required to be ordered by a physician who is treating the beneficiary for a specific illness or injury and is required to be part of the course of that treatment.

“By placing his personal financial benefit ahead of his duty to patients, Webster violated the oath he took as a doctor and caused more than $14.6 million to be lost from critical healthcare programs designed to care for elderly and disabled Americans, as well as for military service members and their families,” said Waldref. “Telemarketing schemes that target and exploit the elderly and our servicemembers are especially pernicious because they prey on those who are often most in need of a doctor’s independent judgment that is not tainted or biased by the doctor’s own personal financial interest.”

During the relevant time period, Webster lived in Olympia, Washington, and was a licensed physician in Washington. According to court documents and information presented at the sentencing hearing, between May 2021 and September 2023, Webster participated in a telemarketing scheme and conspiracy. A company identified as “Company A” obtained Medicare and TRICARE beneficiary information by using telemarketers to contact patients in eastern Washington and elsewhere to obtain their personal and health information. Company A then used the information to create a fake medical record that falsely and fraudulently reflected doctor visits and treatment supposedly performed by Webster that did not exist, and fraudulent medical orders for DME. Webster then signed the fraudulent medical documentation and DME orders, which were then sold by Company A to companies that used the orders to falsely bill Medicare and TRICARE. Company A and Webster also falsely and fraudulently billed Medicare and TRICARE for the fictitious doctor visits and exams that did not take place.

Medicare and TRICARE paid more than $14.6 million for DME fraudulently ordered by Webster for more than 10,000 beneficiaries in eastern Washington and elsewhere, including beneficiaries who lacked the limb for which Defendant supposedly performed the exam and ordered the DME, because it had been previously amputated. Webster also admitted to directly receiving at least $839,565 from Medicare and TRICARE for fraudulent doctor visits and exams that never took place. As part of the sentence, the court also ordered forfeiture of funds in Webster’s bank and investment accounts representing the proceeds of his criminal conduct, and ordered Webster to pay restitution to the Medicare and TRICARE programs.

“Today’s sentencing is a clear signal that those who corrupt federal health care programs, including the Department of Defense’s TRICARE program, will be held accountable,” said Bryan D. Denny, special agent-in-charge of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Western Field Office. “Dr. Webster’s greed siphoned off tax dollars meant to provide health care for members of the U.S. Military and their families. DCIS and our investigative partners will relentlessly pursue those who steal from the government at the expense of taxpayers, our nation’s warfighters, and their families.”

“I want to especially thank and commend the outstanding investigative work by our partners with HHS-OIG and DCIS,” continued Waldref.  “Their skill and dogged determination throughout this complex investigation made this result possible.  We will continue to work hand-in-glove with our law enforcement partners to hold fraudsters accountable.”