In yesterday’s press release, the specific mention of the abuse of “skin grafts” (sic) is from minutes 4:50 to 5:31
Excerpt from remarks by Matthew Galeotti, Head of the Department of Justice (DOJ) Criminal Division, June 30, 2025:
“Many of the defendants charged as part of this takedown specifically targeted our most vulnerable citizens — elderly Americans in nursing homes, individuals with disabilities those battling serious illnesses, and more. For example, our prosecutors charged 7 defendants including five medical professionals in connection with approximately $1 billion in fraudulent claims to Medicare and other healthcare benefit programs for performing medically unnecessary skin grafts on dying patients they were seeking to spend their final days with dignity and peace. That conduct is exactly as callous and disturbing as it sounds. Patients and their families trusted these providers with their lives. Instead of receiving care, they became victims of elaborate criminal schemes…”
More information on the takedown will likely become available as it pertains to wound care services in general– and amniotic use in particular– but a few things are interesting to note.
- A nurse (Gonzalez, apparently with an MD obtained in Mexico but who is described only as a “wound care nurse” in the US), was charged with conspiracy to commit fraud in return for illegal kickbacks from an “allograft distributor” by applying medically unnecessary allografts.
- 2 NPs (Huntly and Denney), were charged with conspiracy to commit health care fraud for medically unnecessary amniotic allografts procured through kickbacks and bribes
- 2 more individuals (Kontos and Kupetz) associated with the Apex scandal were indicted, described as individuals without medical training who were charged with “transactional money laundering” for ordering and recommending allografts to be placed
- 1 NP (Kinds), In association with the above Apex related scandal, was charged for placing amniotic grafts:
- Without coordination with the treating physicians
- In superficial or wounds that did not need treatment and only needed conservative treatment to heal
- In product sizes “excessively larger” than the wound
- An NP (Palacios) was charged with billing for medically unnecessary amniotic allografts that were procured through kickbacks and bribes, in a scheme in which “medically untrained sales representatives identified and referred elderly Medicare beneficiaries” to her, after which she applied amniotic allografts to the beneficiaries “without exercising independent medical judgment and in the amount and frequency determined by the sales representatives.”
- A Florida business owner (Rios) was indicted for a scheme to submit false and fraudulent claims to Medicare and money laundering through shell companies.
- One individual (Rasmussen) agreed to pay over $1.1M to resolve claims for billing an injectable amniotic (FlowerAmnioFlo) which is considered experimental
Also note that from the post yesterday calling out specific cases by state, Yvoune Kara Petrie, 54, of Leesburg, Virginia was charged with health care fraud, not in relation to the use of “skin substitutes,” but in connection with a medical clinic that provided hyperbaric oxygen therapy (“HBOT”). Petrie hired physicians at her clinic but then used at least four physician’s National Provider Identifiers (“NPIs”) without their knowledge or permission to submit fraudulent claims to CareFirst. For example, Petrie used one physician’s NPI to submit fraudulent HBOT claims for that physician, but the treatment was never provided nor prescribed. According to allegations, Petrie caused at least $1,900,000 in actual loss to CareFirst. Physicians need to be extremely wary of the use of their NPI numbers – with or without their knowledge.
It is noteworthy that with the exception of the podiatrist Jensen, all the practitioners above were nurse practitioners or in one case, a nurse who may not have had prescribing authority. This suggests that NPs have entered into business arrangements with amniotic distributors or sales representatives in which their use of amniotic products was determined to be a kickback or “bribe.” NPs are strongly urged to have attorneys review any referral agreements with distributors or sales representatives. Also, the lack of medical training was pointed out in the sales representatives who were indicted for “money laundering.” It is also important to note the fact that many patients were described as being on hospice or at the end of life, a group of patients who are particularly vulnerable and about whom the DOJ is understandably concerned about protecting.
I am not an attorney, so these are a lay person’s observations, but I am trying to understand whether there are theme emerging which should serve as additional warnings to practitioners. The fact that one practitioner may not have had prescribing authority also seems noteworthy. If you are a healthcare attorney and would like to offer a legal perspective about the “themes” in these indictments, please contact me. I am especially interested in the DOJ’s definition of a “kickback” or “bribe.”
Dr. Fife is a world renowned wound care physician dedicated to improving patient outcomes through quality driven care. Please visit my blog at CarolineFifeMD.com and my Youtube channel at https://www.youtube.com/c/carolinefifemd/videos
The opinions, comments, and content expressed or implied in my statements are solely my own and do not necessarily reflect the position or views of Intellicure or any of the boards on which I serve.
