9 charged in fraud case at Anderson dental office

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ANDERSON (April 2, 2014) – Indiana Attorney General Greg Zoeller announced charges Wednesday against nine people in connection with fraud at an Anderson dental office.

The charges filed in Madison County Circuit Court 6 accuse owner Sally Metzner and her co-defendants of inflating Medicaid claims to get larger reimbursements. In some cases, they forged documents, Zoeller said.

The case also includes three dentists and five employees at Anderson Dental Center. Federal agents raided the business for records in March 2011 after obtaining a search warrant.

Metzner, 57, Anderson, faces two counts of corrupt business influence in addition to money laundering, Medicaid fraud, theft, forgery and practicing dentistry without a license.

Three dentists who practiced at the center face charges of corrupt business influence, money laundering, Medicaid fraud and theft:

  • Paul Pangallo, DDS, 73, Indianapolis
  • Jeffrey Rich, DDS, 69, Cicero
  • Thomas Dubois, DDS, 46, Indianapolis

Four office workers are charged with corrupt business influence:

  • Jessica (Metzner) Worrell, 27, Anderson, also charged with forgery
  • Beth Flynn-Lohrey, 45, Middletown, also charged with prescription drug fraud
  • Chris Martin, 31, Anderson, also charged with prescription drug fraud
  • Barbara Brooks, 62, Anderson, also charged with forgery

A fifth office employee, Deborah R. Davis, 55, Middletown, is charged with prescription drug fraud only.

According to the probable cause affidavit, Metzner and the others have been scamming the Medicaid system since 2006. The overpayments from the fraud were then used for their own purposes or invested back into the Anderson Dental Center at 1537 S. Scatterfield Road, Anderson.

According to court documents, the defendants billed for services they didn’t provide, exaggerated some claims for services rendered and submitted claims for work performed by dentists who weren’t authorized Medicaid providers. In other cases, they submitted claims for a dentist who no longer worked at the office and forged the signatures of dentists no longer employed there.

The defendants, for example, billed claims for nitrous oxide as “deep sedation,” a more expensive procedure. Instead of the standard $30, the dental office billed for $125 each. The workers pocketed the difference, prosecutors said. Zoeller said Anderson Dental Center couldn’t conceivably have performed deep sedation procedures because it didn’t have the necessary equipment.

Even after authorities searched the office, the fraudulent billing continued, Zoeller said. A joint investigation found more than $300,000 in ineligible payments.

In December, the State Board of Dentistry issued a cease and desist order against Metzner, who is not a licensed dentist and under state law isn’t allowed to own a dental clinic. The Indiana Family and Social Services Administration also revoked the Medicaid provider status of dentist Paul Pangallo and indefinitely suspended payments for dentist Jeffrey Rich, preventing them from getting Medicaid compensation.

In a separate case that stemmed from the investigation, Metzner agreed in U.S. District Court to plead guilty to federal income tax evasion. She hadn’t paid taxes on more than $850,000, prosecutors said. She’s set to be sentenced April 3 in the tax case. The Medicaid and racketeering charges are a state case and will proceed regardless of the outcome of the plea in the federal case.

The case was investigated by the Attorney General’s Medicaid Fraud Control Unit (MFCU) assisted by the U.S. Health and Human Services’ Office of Inspector General (HHS-OIG), the FBI and the Internal Revenue Service and under the authority of the Madison County Prosecuting Attorney’s Office.