US District Judge Jennifer L. Thurston sentenced two California men, Defendant 1, of Fresno, and Defendant 2, of Clovis, to 63 months in prison for conspiracy to commit healthcare fraud, US Attorney Eric Grant announced on April 13, 2026. Judge Thurston also ordered forfeiture of nine properties owned by the defendants, as well as a $2.6 million personal forfeiture money judgment against Defendant 1 and a $12.1 million personal forfeiture money judgment against Defendant 2.
According to court documents, Defendant 1 was a podiatrist and the sole owner of a podiatric medical practice with locations in three counties. Defendant 2 was a pharmaceutical sales representative who sold skin grafts to Defendant 1. Defendant 2 was not licensed to practice medicine.
Between June 2021 and January 2024, Defendant 1 purchased skin grafts from Defendant 2 and permitted Defendant 2 to apply skin grafts and perform other medical procedures on patients suffering from severe wounds, including foot amputations. Application of skin grafts required sharp debridement, a procedure involving the use of a scalpel to scrape the wound until it bleeds. Some patients believed Defendant 2 was a physician and referred to him as “doctor.” Defendant 2 performed medical procedures without physician supervision, including on patients with recent foot amputations.
The defendants submitted fraudulent claims to Medicare, Medicaid, and Medi-Cal falsely representing that Defendant 1 and other licensed physicians had performed the medical procedures, such as applying skin grafts, when Defendant 2 had actually rendered the services.
In one example, Defendant 1 submitted $150,000 in claims to Medicare in 2023, representing that a physician performed the procedures while the physician was out of the country on vacation. In another example, Defendant 2 used a scalpel to perform procedures on patients with recently amputated feet and applied skin grafts without physician supervision. Defendant 1 was aware of Defendant 2’s conduct and dismissed staff concerns about his involvement.
Throughout the period, staff and third-party auditors raised concerns about the defendants’ billing practices. The defendants ignored those warnings and continued to bill Medicare, Medicaid, and Medi-Cal for services performed by Defendant 2.
As a result, Defendant 1 submitted approximately $3.2 million in false claims to Medicare, Medicaid, and Medi-Cal between 2021 and 2024.
Compliance Perspective
Issue
Healthcare providers participating in Medicare, Medicaid, and other federally funded healthcare programs are required to ensure that services billed for reimbursement are accurately documented, medically necessary, and performed by appropriately licensed and qualified individuals acting within their scope of practice. Services performed by unlicensed or unsupervised individuals, misrepresentation of credentials, and billing for services not rendered as documented may result in civil and criminal liability, exclusion from federal healthcare programs, and reputational harm.
Discussion Points
- Review and update policies and procedures related to documentation standards, billing compliance, scope of practice, supervision requirements, and credential verification processes. Policies should clearly define allowable services by licensure level, supervision expectations for clinical tasks, and procedures for verifying and monitoring staff credentials on an ongoing basis. Policies should also address escalation pathways when potential compliance concerns are identified. Facilities may benefit from periodic policy review in collaboration with regulatory compliance partners or external consultants to ensure alignment with current federal and state requirements.
- Provide ongoing education and training to appropriate staff on documentation accuracy, scope of practice limitations, licensure requirements, and federal and state billing regulations, emphasizing that services must be properly documented, appropriately billed, and performed by qualified and supervised personnel, and that staff are responsible for reporting compliance concerns through established channels. Med-Net Academy offers the course Fraud Module 16 – Financial Integrity, which focuses on ensuring accurate and compliant reimbursement claims based on medically necessary services, supported by verifiable documentation, as well as The Importance of Proper Licensure – A Case Study, which examines licensure requirements, consequences of practicing without a valid license, and case-based analysis of compliance failures and proper scope-of-practice adherence.
- Conduct routine and targeted audits to ensure billed services are supported by contemporaneous documentation and performed by appropriately licensed and supervised personnel. Audits should include review of claims data, clinical documentation, and verification of provider credentials and supervision records. Independent or third-party support, including structured compliance reviews and mock survey methodologies, may assist in identifying risk areas, strengthening internal controls, and ensuring timely corrective action. Contact Med-Net Healthcare Consulting or info@mednetconcepts.com for more information.
*This news alert has been prepared by Med-Net Concepts, Inc. for informational purposes only and is not intended to provide legal advice.*