Lab CEO Pleads Guilty to Distributing Medically Unnecessary Opioids

Case: The CEO of Tri-County Wellness Group and owner of labs and pain clinics in Michigan and Ohio, pleaded guilty to criminal charges for his role in $300 million health care fraud scheme involving distribution of over 6.6 million doses of medically unnecessary oxycodone, hydrocodone and other controlled substances to Medicare patients, some of whom were drug addicts. Some of these opioids were allegedly resold on the street. In addition to $51 million in cash, the CEO will forfeit the other fruits of the scheme including $11.5 million in real estate and Detroit Pistons season tickets.

Significance: The Tri-County case is one of the earliest and biggest of the opioid schemes involving labs and pain clinics. In September 2017, a 72-year-old physician pled guilty to conspiring with two other Detroit-area providers, to carry out the scheme by:

• Prescribing the drugs;
• Directing physicians to make Medicare patients that wanted an opioid prescription to first undergo medically unnecessary facet joint injections and lab tests; and
• Telling physicians to refer those services to labs, clinics and other facilities in which he had secret ownership interests.