Date: May 31, 2024 Contact: newsroom@ci.irs.gov Huntsville, AL — Two men have been sentenced in a series of cases involving multimillion-dollar health care fraud and kickback conspiracies, announced U.S. Attorney Prim F. Escalona; IRS Criminal Investigation (IRS CI) Atlanta Field Office Special Agent in Charge Demetrius Hardeman Federal Bureau of Investigation Special Agent in Charge Carlton L. Peeples; and U.S. Department of Health and Human Services, Office of Inspector General, Special Agent in Charge Tamala E. Miles. “These crimes cost taxpayer-funded insurance programs millions of dollars and exploited vulnerable patients in north Alabama,” said U.S. Attorney Prim Escalona. “The sentences send a vital message: health care fraud and kickbacks are serious crimes and will not be tolerated. Thank you to our prosecutors and law enforcement partners for their hard work and dedication on this case.” “Bowman and his co-conspirators are paying the price for their fraud on the healthcare system,” said IRS CI Special Agent in Charge Demetrius Hardeman. “Fraud is not a victimless crime and through our investigations, we will continue helping bring criminals to justice who line their pockets at others’ expense.” “The FBI views health care fraud as a severe problem that impacts every American,” said FBI Special Agent in Charge Carlton Peeples. “Fraud and abuse take critical resources out of our health care system and contribute to the rising cost of health care for everyone. This case is the result of a multi-agency investigation into a complex scheme, and the FBI and our partners will continue to allocate significant resources to investigate these crimes and prosecute those who defraud the American public.” U.S. District Court Judge L. Scott Coogler sentenced Brian Bowman of Gadsden, to 96 months in prison. In December 2021, Bowman pleaded guilty to health care fraud conspiracy related to his work at Dr. Mark Murphy’s medical practice, North Alabama Pain Services. According to Bowman’s plea agreement, Bowman marketed QBR’s electro-diagnostic testing to medical providers such as Murphy, and was paid a kickback for each test those doctors ordered. Bowman received nearly a million dollars in kickbacks from QBR for Murphy’s orders alone. Bowman also marketed high-reimbursing specialty prescription drugs to the Murphys and other providers and received payments for the prescriptions he generated. Judge Coogler sentenced Jason Max Akin of Florence to 42 months in prison. In May 2023, Akin pleaded guilty to health care fraud in connection with the fraud at Watson Rx Solutions. According to Akin’s plea agreement, Akin was part owner, worked as a pharmacy technician, and helped run sales operations at Watson Rx. Akin paid Bowman and his sales group, including James Ray, John Robson, and others, to generate specialty drug prescriptions from doctors that would be billed to and paid by health insurance plans. Among the people Akin paid to generate prescriptions were urine collectors who were employed by Bowman’s lab company to collect urine at doctor’s offices for drug screens, and who also marketed Watson Rx prescriptions to patients on Bowman’s, Ray’s and Robson’s behalf. Dozens of defendants have been convicted in related cases. Pharmacy cases. Among the medically unnecessary items Bowman, Ray, and Robson marketed were topical creams for specialty pharmacies including Global Compounding Pharmacy and Watson Rx Solutions. Bowman, Ray, and Robson were paid commissions to induce these prescriptions to be issued. According to plea agreements filed in these cases, marketers got blank pre-signed prescriptions from doctors and then completed the prescriptions to ensure insurance would pay for the prescriptions, regardless of whether the drugs were medically necessary for patients’ needs. Those marketers also marked specific drugs or drug formulations to make sure insurance would pay for them. And they assured patients and providers that the pharmacies would not insist on collecting copays, which might discourage patients from getting the prescriptions filled. Sales reps also got prescriptions for themselves—regardless of whether there was a medical need—and Bowman, Ray, and Robson were paid commissions on those prescriptions. QBR cases. Another service Bowman, Ray, and Robson marketed was electro-diagnostic testing, specifically, nerve conduction testing, provided by a Huntsville-based electro-diagnostic testing company called QBR, or Diagnostic Referral Community. Bowman, Ray, and Robson received per-patient kickbacks from QBR for inducing medical providers to order tests from QBR. Medical providers received payments from QBR too; the payments were disguised as hourly payments for the ordering physician’s time and staff’s time, but in reality they were per-patient kickbacks. Dr. Eric Beck of Huntsville, pleaded guilty to health care fraud conspiracy for his role in the fraud at QBR. John Hornbuckle, 54, of Huntsville, pleaded guilty to health care fraud and kickback conspiracy offenses for his role, as QBR’s CEO, in orchestrating the fraud. Medical practice cases. Defendants associated with multiple medical practices have also been convicted in related cases. In one case, a jury convicted Dr. Mark Murphy and his wife Jennifer Murphy both of Lewisburg, Tennessee, of drug distribution, fraud, and kickback crimes. The Murphys operated North Alabama Pain Services, which closed its Decatur and Madison offices in early 2017. According to court documents and evidence presented at trial, the Murphys took kickbacks from QBR of more than a million dollars. In return, Dr. Murphy ordered electro-diagnostic tests from QBR for his patients, regardless of whether there was a medical need for those tests. Dr. Murphy also pre-signed prescriptions for expensive specialty topical creams, sprays, and patches, which patients then received whether they wanted the products or not. In another case, David Lyle Shehi of Rainbow City, pleaded guilty to conspiracy to pay kickbacks and commit health care fraud. Shehi owned Etowah Pain, a pain clinic in Rainbow City, and pleaded guilty to receiving kickbacks in exchange for his practice’s ordering items or services that would be billed to Medicare and other health insurance programs. Mark Murphy and Jennifer Murphy were each sentenced to twenty years in prison. Hornbuckle was sentenced to eighty months. Ray, Robson, and Shehi are all awaiting sentencing. Other co-conspirators have already been sentenced. The IRS CI, FBI, and HHS-OIG investigated the cases. Assistant U.S. Attorneys J.B. Ward and Don Long are prosecuting the cases. CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.
