Family that ran Murfreesboro Ambulance Service is arrested

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Tuesday, January 12, 2010, 5:52pm CST
Family that ran Murfreesboro Ambulance Service is arrested
Nashville Business Journal

The husband-wife-son team that ran Murfreesboro Ambulance Service was arrested today on charges of conspiracy, Medicare fraud and wire fraud, the U.S. Attorney’s Office for the Middle District of Tennessee announced.

Woody Medlock Sr., 66, his wife, Kathy Medlock, 54, and son, Woody Medlock Jr., 44, of Murfreesboro, could each face up to 20 years in prison and a $250,000 fine.

According to a Jan. 6 grand jury indictment, they are accused of submitting more than $1 million worth of fraudulent claims to Medicare and Medicaid and receiving at least $486,000 from Medicare and $101,000 from Medicaid.

At the heart of the indictment are accusations that the Medlocks provided emergency transportation for people who did not need an ambulance, and sometimes transported multiple patients but billed the government as though each patient had received a separate trip.

Woody Medlock Sr. and Kathy Medlock owned the company. In October, the couple filed for Chapter 11 bankruptcy, claiming $1.7 million in liabilities against $1.3 million in assets. Woody Medlock Jr. was a supervisor.

Last month, U.S. attorneys with the Middle District of Tennessee filed suit to seek the forfeiture of a 2005 Corvette and 2008 Harley Davidson belonging to Woody Medlock Sr. and Kathy Medlock, as well as $114,232 that agents seized from the couple’s bank accounts in August.

In that suit, federal investigators said they witnessed supposedly ailing patients forgoing stretchers (which the government was billed for), and instead climbing into the passenger seat for rides to dialysis treatments.

“MAS was in effect acting as a taxi, charging the government in excess of $300 round trip to taxi an ambulatory person to a medical appointment,” stated a special agent with the U.S. Secret Service.

According to the civil suit, Murfreesboro Ambulance Service was the fifth-highest paid ambulance provider in 2005 among 82 Tennessee ambulance providers that transported patients to and from dialysis clinics.

In 2005, dialysis transports accounted for 74 percent of Medicare payments to the company, the suit states.

Previous audits by the Department of Health and Human Services found that the majority of dialysis patients are ambulatory — meaning they can can sit upright — and do not require ambulance transport.

Assistant U.S. Attorneys John K. Webb and Sandra G. Moses are handling the criminal prosecution.

http://www.bizjournals.com/nashville/stories/2010/01/11/daily15.html