The owner of a medical consulting company was sentenced today to two years in federal prison for defrauding health insurers, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.
Steven Berglund, the 52-year-old owner of Elite Healthcare, pleaded guilty to conspiracy to commit wire fraud and healthcare fraud on Nov. 10, 2021 – three days into his criminal trial. He later attempted to withdraw his plea, arguing that the stress of the trial had left him with diminished mental capacity. The court rejected his attempts, ruling that Mr. Berglund had understood his plea and entered it knowingly and voluntarily. He was sentenced Tuesday by U.S. Senior District Judge Terry Means.
At his trial, the government had introduced evidence showing that Mr. Berglund had organized and led an elaborate “pass-through billing” scheme in which health insurers were deceived into paying Palo Pinto General Hospital for laboratory tests were actually performed by out-of-network laboratories. (Due to its status as a rural hospital, Palo Pinto was often able to receive higher reimbursements than urban hospitals or out-of-network labs.)
The evidence also showed that Mr. Berglund and his coconspirators used an overseas company to conduct the fraudulent billing, and used front companies to pay kickbacks to induce doctors to order more laboratory tests.
In plea papers, Mr. Berglund admitted to the scheme.
According to court documents, Mr. Berglund and other members of the conspiracy submitted more than $54 million in laboratory services claims; as a result, insurers paid Palo Pinto more than $8 million. After paying the out-of-network labs, the billing company involved in the scheme, and kickbacks, the coconspirators divvied up rest of the proceeds.
Four of Mr. Berglund’s coconspirators were previously sentenced:
- Aaron Cerpanya, co-owner of Elite, pleaded guilty to conspiracy to commit healthcare fraud and was sentenced to 12 months + one day in prison.
- Adam Gardner, co-founder of MedHealth Solutions, also pleaded guilty to conspiracy to commit healthcare fraud and was sentenced to 12 months + one day in prison.
- Cody Waddell, co-founder of MedHealth Solutions, pleaded guilty to conspiracy to commit healthcare fraud and was sentenced to 18 months in prison.
- Harris Brooks, former CEO of Palo Pinto, pleaded guilty to conspiracy to commit healthcare fraud and was sentenced to five years’ probation.
The court ordered all five defendants jointly and severally liable for $2.4 million in restitution.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Matt Weybrecht, Mark Nichols, and Megan Fahey (fmr) prosecuted the case.