Nevada Doctor Charged in Alleged $95 Million Medicare Wound-Treatment Fraud Scheme

A Nevada physician has been indicted on federal charges accusing him of billing Medicare more than $95 million for medically unnecessary wound treatments provided to elderly patients, including some receiving hospice care.

Stephen Dubin, 74, of Henderson, was charged with conspiracy to commit health care fraud and five counts of health care fraud, according to the U.S. Department of Justice. Medicare allegedly paid more than $54 million on the claims.

Dubin is a physician and the sole owner of Dubin Medical Consultants Inc., which operates as Wound MD. Prosecutors allege that he and his co-conspirators applied costly amniotic wound allografts without regard to whether patients medically needed them.

Amniotic allografts are tissue-based products sometimes used to help treat difficult wounds. According to the indictment, Dubin applied the products to infected wounds, wounds that were not improving and wounds that had not first received the conservative care required by Medicare.

Prosecutors also allege that quantities of the products sometimes greatly exceeded the wounds’ actual size. Dubin allegedly selected particular allografts based on their profit potential rather than patients’ medical needs.

The Justice Department claims Dubin obtained the products through illegal kickbacks, bribes and rebates from two distributors. Some payments were allegedly disguised through “rebate agreements” that substantially lowered his actual acquisition costs.

Dubin then allegedly billed Medicare using prices shown on full-price invoices rather than the lower amounts he paid after receiving the rebates. Prosecutors say he and others kept the difference between Medicare’s reimbursements and the products’ true cost.

The indictment further alleges that one distributor paid kickbacks through a pass-through bank account held in a shell company’s name. The payments were allegedly made in exchange for Dubin purchasing allografts from that distributor.

To conceal the treatments’ alleged lack of medical necessity, Dubin falsified patient records to make the procedures appear reasonable and compliant with Medicare requirements, prosecutors said.

Federal authorities allege that Dubin used money from the scheme to support a lavish lifestyle, including commissioning multimillion-dollar yachts.

“Healthcare fraud is not a victimless crime; it steals vital resources from elderly and vulnerable citizens who truly need life-saving treatments,” First Assistant U.S. Attorney Sigal Chattah said.

The FBI, Department of Health and Human Services Office of Inspector General and Defense Criminal Investigative Service are investigating the case. Prosecutors from the Justice Department’s Fraud Section and U.S. Attorney’s Office for the District of Nevada are handling the prosecution.

Each of the six charges carries a maximum sentence of 10 years in federal prison if Dubin is convicted. Any sentence would be determined by a federal judge after considering sentencing guidelines and other factors.

An indictment contains allegations and is not evidence of guilt. Dubin is presumed innocent unless proven guilty beyond a reasonable doubt.