Telemedicine Company Owner, Doctor Plead Guilty in Multimillion-Dollar Fraud

The owner and chief executive of a telemedicine company, along with a New Jersey physician, have pleaded guilty for their roles in one of the largest healthcare schemes ever, that resulted in charges against 24 defendants.

On September 6, Lester Stockett pleaded guilty to one count of conspiracy to defraud the U.S. and pay and receive healthcare kickbacks, along with one count of conspiracy to commit money laundering. And, on September 12, Dr. Joseph DeCorso, a New Jersey physician, pleaded guilty to one count of conspiracy to commit health care fraud.

Stockett was the owner of Video Doctor USA and owner and CEO of Telemed Health Group LLC (AffordADoc). For his role, he agreed to pay $200 million in restitution and forfeit assets and property traceable to proceeds. He is scheduled to be sentenced Dec. 16.

Dr. DeCorso admitted that while working for Stockett’s telemedicine companies, he wrote medically unnecessary orders for orthotic braces for Medicare patients between July 2017 and March 2019, resulting in a $13 million loss to Medicare. Dr. DeCorso agreed to pay more than $7 million in restitution, as well as forfeit assets and property traceable to proceeds of the conspiracy. 

The doctor admitted that he wrote brace orders for the telemedicine companies without speaking to the patients and that he wrote orders that stated, among other things, that he had “discussions” or “conversations” with patients or had conducted diagnostic testing for beneficiaries, when, in fact, he had not spoken to them, nor had he conducted any testing.

Stockett admitted that he and others agreed to solicit and receive illegal kickbacks and bribes from patient recruiters, pharmacies, brace suppliers and others in exchange for arranging for doctors to order medically unnecessary orthotic braces for patients insured by Medicare and other insurance companies.

Patients were contacted through an international telemarketing network involving call centers in the Philippines and throughout Latin America. The activity resulted in $424 million in false and fraudulent claims to Medicare that were submitted by brace suppliers. Medicare paid out in excess of $200 million.

Stockett was charged along with Harry Creaghan of Highland Beach, Fla., and Elliot Loewenstern of Boca Raton, Fla. The cases against both men are pending.

As we wrote about in July, the growth of telemedicine is resulting in an increase in healthcare fraud. There are new telemedicine opportunities popping up every day. Some are legitimate and some are not. Physicians looking to do business with telemedicine companies would be well-advised to seek the advice of counsel. If an offer from a telemedicine company sounds too good to be true, it probably is.

The Health Law Offices of Anthony C. Vitale represents clients in state and federal court who are charged with fraudulent billing, kickbacks, Medicare and Medicaid fraud and false claims, among others. Give us a call at 305-358-4500, or send an email to info@vitalehealthlaw.com and let’s discuss how we might be able to assist you.

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