Laboratory Owner Sentenced to 36 Months in Federal Prison for Healthcare Kickback Scheme

United States Attorney Ronald C. Gathe, Jr. announced that Chief Judge Shelly D. Dick sentenced Terry Wilks Jr., age 41, of Greenwell Springs, Louisiana, to 36 months in federal prison following his conviction for conspiracy to pay and receive healthcare kickbacks.  The Court further sentenced Wilks to serve two years of supervised release following his term of imprisonment ordered him to pay restitution in the amount of $5,017,861.03 and forfeit $447,249.52.  Laboratory Sales Representative, Leslie McHugh, age 38, of Palmetto, Florida, was previously sentenced by Chief Judge Dick to 12 months and one day in federal prison for her involvement in the scheme.  The Court further sentenced McHugh to serve two years of supervised release following her term of imprisonment.

According to court documents and admissions made as part of both Wilks’s and McHugh’s guilty pleas, Wilks was an owner and the CEO of Acadian Diagnostic Laboratories, LLC, a clinical laboratory based in Baton Rouge, Louisiana.  McHugh worked as a sales representative for Acadian.  In late 2016, McHugh was excluded from participation in the Medicare program.  However, despite her exclusion, McHugh continued to refer doctors’ orders and specimens for testing by Acadian, in exchange for kickbacks paid by Wilks.  These referrals caused the submission of claims by Acadian to Medicare and TRICARE.   During the period that McHugh was excluded, Wilks made cash and wire payments, totaling over $69,000, to McHugh in exchange for referrals.  As a result of those referrals, Acadian submitted over $500,000 in claims to Medicare and TRICARE and was reimbursed over $127,000.  In addition to McHugh, Wilks admitted to paying another sales representative of Acadian over $2.3 million in kickbacks for his referrals to the lab from January 2016 through December 2018, which resulted in over $40 million billed to Medicare and Louisiana Medicaid.  In turn, Medicare and Louisiana Medicaid reimbursed Acadian over $4.8 million.

The case was investigated by HHS-OIG, Louisiana Attorney General’s Medicaid Fraud Control Unit, FBI, and DCIS and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Middle District of Louisiana.  Trial Attorneys Samantha E. Stagias and Justin M. Woodard of the Fraud Section and Assistant U.S. Attorney Kristen L. Craig of the Middle District of Louisiana prosecuted the case.