A Pikeville man was indicted this week on federal wire fraud and health care fraud charges related to his ownership and operation of three substance abuse disorder clinics and related businesses in Eastern Kentucky.
The indictment was handed down by a grand jury in the U.S. District Court for the Eastern District of Kentucky on Nov. 18 against Eugene Sisco III, 35, linked to crimes he allegedly committed as the owner and operator of Renew Addiction Treatment Clinic LLC.
Renew, the indictment said, was also known as Behavioral Health Professionals and was an outpatient substance abuse disorder clinic with locations in Pike County, Floyd County and Harlan County. During the same time, the indictment said, Sisco owned and operated ASAP Addiction Treatment LLC, another outpatient substance abuse disorder clinic in Pike County, and RENEW Residential Treatment services LLC, d/b/a Brookside, as well as Toxperts LLC, a urine drug testing laboratory in Pike County.
From about May 2016, and through Oct. 1, 2019, the indictment charges, Sisco “devised and intended to devise a scheme to defraud and to obtain money and property by means of materially false and fraudulent pretenses, representations and promises.”
The indictment charges that, although Sisco was aware that the Medicaid program prohibited Medication Assisted Treatment providers such as ASAP Addiction Treatment and Renew from charging patients cash for Medicaid covered services, Sisco charged patients cash for the MAT services and also billed the Medicaid program for those MAT services.
According to the indictment, when Medicaid members questioned why they were paying for services for which their insurance was billed, Sisco caused his employees to misrepresent that Medicaid would not pay for counseling services provided at ASAP Addiction Treatment and Renew.
The indictment charges that, when employees and contractors of ASAP and Renew questioned the legality of the cash charges to patients of those clinics, Sisco falsely stated that the cash charge covered counseling services or urine drug testing services that Medicaid would not pay for, even though he knew that Medicaid would pay for counseling service and even though he knew that Toxperts LLC, the lab he owned and operated, was receiving payment from Medicaid for the urine drug testing services.
Further, the indictment charges, Sisco required patients at Renew to sign a “Statement of Financial Responsibility” form falsely stating that counseling services were provided by a separate entity called Renew Behavioral Health that was not a medical provider and not eligible to bill Medicaid, and thus counseling would cost $225 a month. In truth, the indictment said, the counseling services at Renew were at all times provided by employees and contractors of Renew and Renew Behavioral Health was at all times an Alcohol and Other Drug Entity licensed with Medicaid.
All this, the indictment charged, was done despite the fact that Sisco was warned by letter from Medicaid dated May 10, 2016, that such cash billing was considered an unacceptable practice and would subject his clinics to termination as Medicaid providers.
The health care fraud charge, the indictment said, relates to Sisco causing claims for payment to be submitted for medically unnecessary urine drug testing performed at Toxperts, documents said.
According to a statement from Kentucky State Police, the investigation leading to the indictment was jointly conducted by Appalachia Narcotics Investigations, Diversion Enforcement Task Force, the FBI HEAT Task Force (All Appalachia HIDTA Task Forces) and the United States Attorney’s Office in Lexington, Ky. They were assisted by the Kentucky State Police, Harlan County Sheriff’s Office, Harlan Police Department and the Kentucky Office of the Attorney General Medicaid Fraud Control Unit.
According to the indictment, if convicted of the wire fraud charge, Sisco faces a maximum prison sentence of no more than 20 years, as well as a fine of no more than $250,000 or the greater of twice the gross gain or twice the gross loss and supervised release of no more than three years.
The indictment said that, if convicted of the health care fraud charge, Sisco faces no more than 10 years in prison, a fine of no more than $250,000 or the greater of twice the gross gain or twice the gross loss and supervised release of no more than three years.
A summons was issued for Sisco, court documents show, and he is scheduled to appear in court via video on Dec. 7.