Doctor Pleads Guilty to Kickback Scheme Involving TRICARE Patients

SPOKANE, Washington—Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington, announced that Thomas Andrew Webster, M.D., age 51, of Sylvania, Ohio, pled guilty to conspiring to accept kickbacks in connection with a fraudulent telemarketing and medical supply scheme throughout Washington and in other states. District Judge Mary K. Dimke accepted Webster’s guilty plea and set sentencing for June 26 in Spokane, Washington. 

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). 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. 

During the relevant time period, Webster lived in Olympia, Washington, and was a licensed physician in Washington.  According to the Plea Agreement and information disclosed in court proceedings, 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 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 Dr. Webster also falsely and fraudulently billed Medicare and TRICARE for the fictitious doctor visits and exams that did not take place. 

“Health care fraud and kickback schemes are a serious problem,” said Waldref. “They divert precious public funds away from treating patients, drive up the cost of health care services and often make quality health care beyond the reach of the most vulnerable members of our community who need it the most. 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.”

According to the Plea Agreement and information disclosed in court proceedings, Medicare and TRICARE paid more than $13.7 million for DME fraudulently ordered by Webster for thousands of 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 Plea Agreement, Webster agreed to forfeiture of bank accounts and other assets representing the proceeds of his criminal conduct. 

“Dr. Webster’s conviction culminates his illicit, greed-driven scheme to defraud federal health care programs, including the Department of Defense’s TRICARE program,” said Bryan D. Denny, special agent-in-charge for the Department of Defense Office of Inspector General, Defense Criminal Investigative Service. “Fraudulent health care billings inflate costs, erode public confidence and in the case of the Department of Defense, ultimately degrade American warfighter readiness and undermine the missions of our military services.”

“Physicians that receive unlawful kickbacks in exchange for ordering medically unnecessary services erode the public’s trust and waste valuable taxpayer dollars” said Steven J. Ryan, special agent in charge of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). “This outcome demonstrates HHS-OIG’s steadfast commitment to work with our law enforcement partners to investigate those who defraud federal health care programs.”

“I am grateful for, and commend, the exceptional investigative work on this case performed by HHS OIG and DCIS, as well as the important forfeiture work that will return precious funds to the public so that they can be used for patient care” said Waldref.  “We will continue to work with our law enforcement partners to make our communities safer and stronger, by aggressively pursuing telemedicine kickback schemes, health care fraud and elder abuse.”