Nevada doctor indicted in $95 million Medicare fraud scheme

A federal grand jury in the District of Nevada has indicted Dr. Stephen Dubin, 74, of Henderson, Nevada, on charges tied to an alleged $95 million scheme to defraud Medicare through medically unnecessary amniotic wound treatments, according to the Justice Department.

Prosecutors allege that Dubin, sole owner of Dubin Medical Consultants Inc., also known as Wound MD, billed Medicare for costly amniotic allografts applied to elderly patients — including some in hospice care — without medical necessity. Medicare paid more than $54 million based on the allegedly false and fraudulent claims, the Justice Department said.

According to court documents, Dubin obtained the allografts through arrangements involving illegal kickbacks, bribes, and rebates from two distributors. Some payments were allegedly structured as legitimate “Rebate Agreements” to conceal their true nature. Prosecutors say the purported rebates substantially reduced Dubin’s actual cost, but he sought Medicare reimbursement based on sham full-price invoices rather than the price he paid, allowing him and others to keep the difference. The indictment also alleges that he received kickbacks funneled through a shell company’s pass-through bank account in exchange for purchasing allografts from one distributor.

Induced by those kickbacks, bribes, and rebates, Dubin and his co-conspirators allegedly applied allografts without regard to medical necessity — including on infected wounds, on wounds not responding to allograft treatment, without first attempting, completing, or confirming conservative wound care as required by Medicare, and in quantities far exceeding the size of the wounds. Prosecutors also allege that Dubin selected allografts to maximize his profit rather than meet patients’ needs and falsified patient records to make the treatments appear medically justified and compliant with Medicare requirements.

Dubin allegedly used proceeds from the offenses to fund a lavish lifestyle, including having multi-million-dollar yachts built for him, according to the indictment.

Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division described the alleged conduct as a scheme “driven by greed, not medicine.” First Assistant U.S. Attorney Sigal Chattah for the District of Nevada said the defendants “prioritized personal greed over patient care.” FBI Las Vegas Special Agent in Charge Christopher S. Delzotto called the alleged conduct a “betrayal of trust,” while HHS-OIG Special Agent in Charge Robb R. Breeden emphasized protecting Medicare patients and federal health care programs from fraud. Defense Criminal Investigative Service Special Agent in Charge John Helsing separately stressed the agency’s continuing efforts to protect TRICARE, the health care program serving military personnel, retirees, and their families. The allegations described in the release concern Medicare; the release does not state that TRICARE was billed in the alleged scheme.

Dubin faces one count of conspiracy to commit health care fraud and five counts of health care fraud. If convicted, he faces a maximum sentence of 10 years in prison for each count, prosecutors said.

The case is being investigated by the FBI, HHS-OIG, and the Defense Criminal Investigative Service. Trial Attorneys Chris Wenger and Shane Butland of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Jessica Oliva for the District of Nevada are prosecuting it.

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The case is associated with the West Coast Health Care Fraud Strike Force, a multi-district initiative formed in April that brings together the Justice Department’s Health Care Fraud Section and the U.S. Attorney’s Offices for the District of Arizona, District of Nevada, and Northern District of California. Separately, the Justice Department said its nationwide Health Care Fraud Strike Force Program, currently comprising nine strike forces, has charged more than 6,200 defendants who collectively billed federal health care programs and private insurers more than $45 billion since 2007.

An indictment contains allegations only. Dubin is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

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