Registered Nurse Pleads Guilty to Medicare Kickback Scheme

SACRAMENTO, Calif. — John Eby, 46, of Fair Oaks, pleaded guilty today to conspiring with the owners of home health agencies to pay and receive illegal kickbacks in exchange for Medicare beneficiary referrals, U.S. Attorney McGregor W. Scott announced.

According to court documents, Eby is a registered nurse who was a case manager at a nonprofit hospital in Sacramento. As a case manager, Eby was responsible for assisting Medicare beneficiaries in selecting post-acute care providers, including home health care and hospice agencies, after the beneficiaries were discharged from the hospital. Eby used his position to steer Medicare beneficiaries to home health agencies in Folsom and El Dorado Hills. From approximately September 2015 through November 2018, the home health agency owners used an intermediary to pay Eby illegal kickbacks for beneficiary referrals.

According to court documents, in total, Eby referred approximately 55 beneficiaries to the agencies in exchange for kickbacks, and Medicare paid the agencies approximately $250,000 for services they purportedly provided to the beneficiaries. Because the agencies obtained the beneficiary referrals by paying kickbacks, they should not have received any reimbursement from Medicare.

In addition to the conspiracy charge, Eby pleaded guilty to one count of accepting a $1,000 cash kickback in exchange for referring five Medicare beneficiaries to the home health agency in Folsom.

This case is a product of an investigation by the Federal Bureau of Investigation and the Department of Health and Human Services’ Office of Inspector General. Assistant U.S. Attorney Matthew Thuesen is prosecuting the case.

U.S. District Judge Morrison C. England Jr. is scheduled to sentence Eby on Jan. 9, 2020. Eby faces maximum statutory penalties of five years in prison for the conspiracy charge and 10 years in prison for the kickback charge. Eby also faces a maximum fine of $250,000 or twice the gross gain or loss for each charge. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.