U.S. Attorney for the Western District of Michigan, Mark Totten, announced the successful resolution of several criminal and civil cases against doctors involved in fraudulent telemedicine schemes that exploited Medicare for millions of dollars. The enforcement actions, part of the ongoing Operation “Happy Clickers,” led to the criminal convictions of two physicians and civil settlements with three others, all accused of authorizing unnecessary medical orders for braces and genetic testing that were later billed to Medicare.
Operation “Happy Clickers” is a joint effort between the U.S. Attorney’s Office, the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), and the Federal Bureau of Investigation (FBI). The initiative targets doctors who participated in fraudulent telemarketing schemes, ordering medically unnecessary services without ever examining patients, often in just a matter of seconds.
Criminal Convictions and Civil Settlements
The actions announced today include the guilty pleas and civil settlements of several doctors, including:
- Theresa Kordish, D.O. (Kalamazoo, MI) pleaded guilty to making false statements related to healthcare matters. She admitted to authorizing fraudulent medical orders for patients she never met, as part of a telemedicine scheme. Dr. Kordish agreed to pay a civil settlement of $50,000.
- Utibe Effiong, M.D. (formerly of Mt. Pleasant, MI) also pleaded guilty to similar charges. Dr. Effiong, who approved fraudulent medical orders without patient exams, agreed to pay $150,000 as part of his civil settlement.
In addition to the criminal convictions of Drs. Kordish and Effiong, the U.S. Attorney’s Office reached civil settlements with three other physicians:
- Derek Grossman, D.O. (Traverse City, MI) agreed to pay $295,192.93 to resolve allegations of ordering over 1,300 unnecessary orthotic braces.
- Pedro Toweh, M.D. (Battle Creek, MI) settled for $85,822 for his involvement in ordering over 800 unnecessary braces.
- Aaron Willen, D.O. (formerly of Kalamazoo, MI) agreed to pay $80,000 for ordering medically unnecessary orthotics.
Dr. Kordish is scheduled to be sentenced on February 10, 2025, while Dr. Effiong’s sentencing is set for February 18, 2025.
Telemedicine Fraud: How It Worked
The fraudulent scheme involved telemarketing companies placing calls to Medicare beneficiaries, often through overseas call centers, to solicit personal information that would allow marketers to fill out bogus medical orders for expensive services such as orthotic braces and genetic testing. These fraudulent orders were then sent to physicians who authorized them via telemedicine programs without ever meeting or examining the patients. The signed orders were subsequently sold to medical supply companies and testing laboratories.
The criminal activity wasted billions of dollars in Medicare funds, with some genetic tests alone costing as much as $8,000 per test. Federal investigators tracked down these fraudulent practices through detailed reviews of Medicare billing data.
Significant Financial Recovery
As a result of these resolutions, the U.S. government has recovered over $1 million for the Medicare program through civil settlements, in addition to restitution that is expected from the criminal cases. However, most of these civil settlements were based on the defendants’ inability to pay higher amounts.
Statements from Authorities
“This coordinated effort is an essential step in ensuring accountability in the healthcare system,” said Mario M. Pinto, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General. “Our agency is committed to holding bad actors accountable and recovering Medicare funds that were misused.”
Cheyvoryea Gibson, Special Agent in Charge of the FBI in Michigan, emphasized the importance of the action, stating, “These individuals exploited a vulnerable population for personal gain, betraying the trust of their patients and the healthcare profession. The FBI, alongside HHS and other law enforcement partners, will continue to hold those who undermine the integrity of our healthcare system accountable.”
Ongoing Investigations
Operation “Happy Clickers” follows earlier enforcement actions targeting marketers and owners of medical supply companies and genetic testing laboratories involved in the fraudulent schemes. To date, the initiative has resulted in actions against nine doctors and nurse practitioners who authorized over $10.5 million in fraudulent Medicare claims.
