Georgia Man Pleads Guilty to Conspiracy Charges for Defrauding State Medicaid Programs

Markuetric Stringfellow, 37, of Powder Springs, Georgia, appeared in court last week and pleaded guilty to federal conspiracy charges filed in the U.S. District Courts in North and South Carolina, for defrauding the states’ Medicaid programs, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina, and U.S. Attorney Peter M. McCoy, Jr., of the U.S. Attorney’s Office for the District of South Carolina. U.S. Magistrate Judge David S. Cayer presided over today’s plea hearing.

The North Carolina Scheme

According to filed plea documents and today’s plea hearing, Stringfellow was a resident of Charlotte and Greensboro, North Carolina, and a partner in Everlasting Vitality, LLC (EV) and Do-It-4-The Hood Corporation (D4H). D4H operated after-school programs in Charlotte, Greensboro, Winston-Salem, and Rocky-Mount, North Carolina, among others. Beginning in or about January 7, 2016, and continuing through November 12, 2018, Stringfellow and his co-conspirators executed a conspiracy to defraud the North Carolina Medicaid program by soliciting illegal kickbacks from various drug testing laboratories, in exchange for referrals of North Carolina Medicaid beneficiaries obtained through the after-school programs operated by EV and D4H.

According to court documents, Stringfellow and his co-conspirators paid individuals to recruit at-risk youths, in particular children who were Medicaid eligible, for EV’s or D4H’s after-school and youth mentoring programs. Once enrolled, children were required to submit urine specimens for drug testing. Stringfellow and his co-conspirators conspired with certain laboratories to perform the drug testing of the urine specimens submitted in the names of children enrolled at EV and D4H, and received kickbacks after the laboratories were reimbursed by the North Carolina Medicaid.

In addition to the kickback scheme, Stringfellow and his conspirators devised a scheme to defraud North Carolina Medicaid by referring clients to laboratories which they knew would file fraudulent claims and receive reimbursement based on drug testing services that did not meet the drug testing policy requirements. For example, on some occasions, Stringfellow and his co-conspirators obtained personal identifying information (PII) of D4H clients, such as names, addresses, dates of birth, and Medicaid beneficiary numbers, which they provided to drug testing laboratories. In turn, the laboratories used D4H clients’ PII to submit drug testing claims to the North Carolina Medicaid that were fraudulent because, among other reasons, the drug tests were not medically necessary, or the urine specimens were not of the Medicaid beneficiaries under whose names they were submitted. Once North Carolina Medicaid paid the fraudulent claims submitted by the testing laboratories for these unauthorized and medically unnecessary drug tests, the labs then paid companies under the control of Stringfellow and others, at an agreed percentage of their Medicaid reimbursement.

The South Carolina Scheme

In addition to executing a fraudulent scheme in North Carolina, Stringfellow has admitted to defrauding the South Carolina Medicaid program. According to the bill of information and documents filed with the U.S. District Court in South Carolina, Stringfellow was a franchise owner of Wrights Care Services LLC (Wrights Care), a qualified provider of Medicaid rehabilitative behavioral health services in South Carolina.  Wrights Care was located at 1320 Main Street, in Columbia, South Carolina, and maintained separate franchise locations throughout South Carolina, including in Spartanburg, Pickens, Cheraw, Society Hill, Bennettsville, Hartsville, and Conway. In April 2014, Wrights Care became a participating provider in the South Carolina Medicaid program, which allowed Wrights Care to submit claims for behavioral mentoring services reimbursable under Medicaid.

Starting in or around 2014, Stringfellow and his co-conspirators defrauded the South Carolina Medicaid program by filing fraudulent claims for services that were either not provided, partially provided, or did not qualify for reimbursement.  According to court records, to support the fraudulent reimbursement claims filed with the South Carolina Medicaid, Stringfellow and his co-conspirators submitted falsified patient billing records and fake medical notes. Furthermore, court records show that after learning there was a Medicaid audit for Wrights Care, Stringfellow and his co-conspirators attempted to deceive South Carolina Medicaid auditors. In or about March 2015, Stringfellow met other associates of Wrights Care in Columbia for a “note party,” during which the co-conspirators created false and fraudulent billing records to substantiate previously-submitted fraudulent Medicaid claims, forged signatures, and falsified records subject to the audit, which they then submitted to South Carolina Medicaid auditors in response to the audit.

Stringfellow pleaded guilty today to two counts of conspiracy to commit Medicaid fraud. The South Carolina case will be transferred to the U.S. District Court for the Western District of North Carolina. Each conspiracy charge carries a maximum sentence of five years in prison and a $250,000 fine. A sentencing date for Stringfellow has not been set.

In making today’s announcement U.S. Attorney Murray and U.S. Attorney McCoy commended the investigative work of the FBI field offices in Charlotte, Columbia and Atlanta, and the Medicaid Investigation Divisions in Raleigh, Columbia and Atlanta, and thanked the U.S. Attorney’s Office for the Northern District of Georgia for their assistance and coordination.

Assistant U.S. Attorneys Michael Savage in Charlotte and Brook Andrews in Columbia are prosecuting the case.