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Published on April 13, 2024
Ex-Military Duo Sentenced in San Diego for Role in $65 Million TRICARE Fraud SchemeSource: Google Street View

Two ex-military men, Joshua Morgan and Kyle Adams, were handed their sentences in a federal court in San Diego for their role in a $65 million scam that targeted TRICARE, the U.S. military's health care program, as final participants of a larger conspiracy that drained the program's resources, confirmed the U.S. Department of Justice. The former U.S. Marine, Morgan, received a 21-month sentence and the former U.S. Navy Sailor, Adams, got 15 months, both also facing orders to pay back millions.

Morgan and Adams pleaded guilty to conspiring in a fraud that involved them recruiting servicemembers and their dependents to get costly prescription compounded medications, and those prescriptions were anything but legitimate leading to at least $65 million in TRICARE losses, according to a U.S. Department of Justice press release. Chargemaster Jimmy Collins and his wife, Ashley Collins, who orchestrated the operation from Birchwood, Tennessee, received harsher sentences, with Jimmy Collins sentenced to 10 years in prison and Ashley Collins to 18 months of home confinement.

The scheme allowed servicemembers, tempted by kickbacks, to sign up to receive the pricey drugs; Morgan confessed it was "easy money" and he pocketed over $2.6 million while Adams raked in more than $1 million, in a system where the prescription drugs sometimes cost as much as $25,000 per month, they both also admitted to getting a 3 to 7 percent kickback from the reimbursements paid to the pharmacy by TRICARE for the drugs dispensed to their recruits.

U.S. Attorney Tara McGrath stated, "Today’s sentencing closes the last chapter on this outrageous fraud scheme that almost put TRICARE into bankruptcy," and added, "Our military members and taxpayers deserve so much better," indicating a strong stance against those who prey on governmental programs intended to aid service members and their families, this case draws attention to a spike in fraudulent compounded drug prescriptions that led TRICARE to a staggering $2 billion liability increase, as part of the larger issue.

In addition to the Yates, others, including patient recruiters and medical professionals, such as doctors Carl Lindblad and Susan Vergot, along with nurse practitioner Candace Craven, have previously faced the music for their involvement in the widespread fraudulent activity. Director Omar Lopez from the Naval Criminal Investigative Service emphasized NCIS would not tolerate such acts against service members. Director Kelly Mayo of the Defense Criminal Investigative Service (DCIS) spoke of their relentless commitment to prosecuting TRICARE fraud.