At least 119 Amtrak employees participated in a scheme with healthcare providers that defrauded the company’s health insurance plan of more than $12 million between 2019 and 2022, according to findings released by the Amtrak Office of Inspector General (OIG).
The report detailed how employees in five states – Pennsylvania, Delaware, New Jersey, New York – and Washington, D.C., collaborated with three medical providers who submitted fraudulent or medically unnecessary claims using employee insurance information. In some cases, dependents' information was also used.
Amtrak’s health plan was billed more than $16 million through the fraudulent activity and ultimately paid out over $12 million.
Of the 119 employees identified, 28 either retired or resigned as a direct result of the investigation, and another 30 departed for unrelated reasons. A total of 12 employees have been criminally charged; seven of those have pleaded guilty and are awaiting sentencing. Findings related to the remaining 61 active employees were referred to Amtrak for potential administrative disciplinary action.
Amtrak Inspector General Kevin H. Winters (pictured above) said the scale of participation in the scheme pointed to broader concerns about workplace culture.
“After assessing the significant number of employees involved, this case represents the largest employee conspiracy our office has ever investigated,” Winters said in a report from AM Best.
The investigation revealed that employees received cash payments from health care providers in exchange for access to their insurance information. The providers then used this information to submit false claims for services that were either never rendered or not medically necessary.
Former Amtrak employee Devon Burt and co-conspirator Hallum Gelzer were found to have played a key role in recruiting other employees. Both pleaded guilty in June 2023 to conspiracy to commit healthcare fraud and conspiracy to commit extortionate threats.
Burt agreed to pay $959,072 in restitution, while Gelzer was ordered to pay $1.66 million. They also admitted to threatening a doctor in an attempt to secure payment for Gelzer.
Six other Amtrak employees also pleaded guilty to conspiracy to commit healthcare fraud. Sentencing for those involved remains pending in several cases.
The OIG did not release the names of the involved medical providers but said its investigation remains ongoing.
Healthcare insurance fraud remains a significant concern in the United States, with recent years witnessing substantial financial losses and high-profile cases.
In 2023, the US Department of Health and Human Services (HHS) and the Department of Justice (DOJ) reported recovering $3.4 billion through the Health Care Fraud and Abuse Control (HCFAC) Program. This initiative also led to the exclusion of over 2,100 individuals and entities from federal healthcare programs.
The DOJ's 2024 National Health Care Fraud Enforcement Action resulted in criminal charges against 193 defendants across 32 federal districts, involving approximately $2.75 billion in alleged false claims.
Notable cases include a $79 million scheme by a Texas laboratory owner charged for fraudulent respiratory pathogen panel tests. In another instance, a Georgia woman was charged with defrauding over $44,000 from Connecticut's Medicaid program by submitting false timesheets for services not rendered.
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