Healthcare fraud case leads to 13-year sentence
Published 8:52 am Thursday, May 3, 2018
RALEIGH – A federal case involving healthcare fraud that cost a local nurse her livelihood last year landed a Greenville man in prison here Tuesday.
United States Attorney Robert J. Higdon, Jr. announced in federal court that Shephard Lee Spruill, age 47, was sentenced to 96 months behind bars on the charge of healthcare fraud conspiracy, and 60 months in prison for perjury, to be served concurrently.
Spruill was also ordered to make restitution in the total amount of $5,998,874.86, payable to the North Carolina Medicaid Program, the South Carolina Medicaid Program, and another victim of the scheme. He was further ordered to serve a three-year term of supervised release, and to forfeit an additional $939,989.50 in criminal proceeds.
Under the terms of his plea agreement, Spruill is also banned from participation in Federal healthcare benefit programs for life.
Higdon said Spruill’s case arose out of the investigation of Pitt County behavioral health provider Terry Lamont Speller of Winterville; his biller, Donnie Lee Phillips, II of Greenville; and another Medicaid provider named Reginald Saunders. Each of these defendants were previously sentenced by Senior U.S. District Judge James C. Fox to 20 years, 9 years, and 3 years, respectively.
It was the Speller case that caught Christine Hicks Thomas of Murfreesboro in its web. The local nurse entered a plea of guilty while appearing in Federal Eastern District Court of North Carolina in Raleigh.
According to the criminal information and evidence, Thomas agreed to sign off on orders authorizing various Medicaid recipients to receive outpatient behavioral health services. In fact, Thomas never evaluated the patients or made any clinical assessment of whether the services were medically necessary for the recipients, as noted in Federal Court.
In a recorded encounter in a parking lot, Thomas accepted a cashier’s check in exchange for signing the orders.
The orders that Thomas signed are required by Medicaid’s Managed Care Organizations as a prerequisite before a Medicaid provider can bill the government for outpatient behavioral health services. Once authorization orders are signed, providers can lawfully bill the government for hundreds of thousands of dollars in outpatient behavioral health services, provided such services are actually rendered.
The terms of the plea agreement included surrendering her nursing license, to surrender any interest she has in companies that bill the government for health care services, and to be permanently excluded from Medicare and Medicaid programs, in addition to the possible prison term and fines.
As for the federal case heard this week, according to the criminal information and evidence discussed in open court, Spruill, then the leader of Carolina Support Services, an East Carolina behavioral health practice, supplied hundreds of patient names and identifiers to Speller, who in turn had Phillips bill the North Carolina Medicaid Program for millions of dollars in fictitious mental health services.
Spruill, Speller, and Phillips split the fraud proceeds, with Spruill receiving his cut of the funds in the form of fictitious, no-document loan repayments. Spruill appeared before a federal grand jury and lied about his involvement with Speller, falsely claiming that he had no business relationship with Speller.
The continuing investigation into Spruill revealed he also engaged in a fraud upon the South Carolina Medicaid program, billing and being paid millions in fictitious services through another provider he owned.
“As we continue to combat drug dealers and violent criminals in our district, do not for a moment believe that we have given a pass to those whose steal from taxpayers through fraud,” Higdon stated. “This case shows our continuing resolve to bring all to justice, even CEOs who commit their crimes with lies instead of guns. This case also sends a message about the integrity of our grand jury system. Those who choose to lie in the grand jury will be held fully accountable.”
“Healthcare fraud is not a road to easy riches, as this sentence demonstrates” said Derrick L. Jackson, Special Agent in Charge of the Office of Inspector General of the U.S. Department of Health and Human Services. “Those who steal from taxpayers and vital government healthcare programs will be held accountable for their actions.”
In a related case, Atoya Bellamy, 45, of Morrisville, was sentenced to one year in prison for her role in Spruill’s fraud at Carolina Support Services. Bellamy previously pleaded guilty to conspiracy to commit healthcare fraud on November 29, 2017. Bellamy was also ordered to make restitution to the Government.
If you suspect Medicaid or Medicare fraud, visit the HHS OIG website at https://oig.hhs.gov/ and click on the Report Fraud button. To report Medicaid fraud in North Carolina, call the North Carolina Medicaid Investigations Division at 919-881-2320.