Two convicted for federal health care fraud related to multi-state $1.4 billion hospital billing scheme uncovered during audit in Putnam County by Auditor Galloway

State Auditor Nicole Galloway today released a statement after a federal jury in Florida on Monday convicted the head of a hospital management company and another individual for their roles in a conspiracy to operate a multi-state $1.4 billion billing scheme that used rural hospitals to submit fraudulent claims. Jorge Perez and Ricardo Perez, who were also convicted of health care fraud, will be sentenced at a later date.

Auditor Galloway's office has been working with federal law enforcement agencies since the scheme was uncovered during a 2017 audit of Putnam County Memorial Hospital. That audit, which found $90 million in illegal billings were passed through the 15-bed hospital, marked the largest fraud exposed in the history of the Missouri State Auditor's Office; the former CEO of the hospital pleaded guilty to federal health care fraud charges in 2019.

"The unraveling of this billing scheme began right here in Missouri with a state audit," Auditor Galloway said. "All of us pay the costs of health care fraud, and I'm proud of how staff from my office worked with the Department of Justice and other federal agencies to share what we uncovered in Putnam County and help bring this fraud to an end."