Former Madison Parish hospital head sentenced

Published 11:00 am Thursday, February 6, 2014

A former Madison Parish Hospital administrator will spend more than three years in federal prison for operating a Medicare kickback scheme at the hospital.

Charles Wendell Alford, 71, of Newellton, La., was sentenced by U.S. District Judge Robert G. James to 36 months in prison after pleading guilty late last year to health care fraud.

Owens resigned as administrator of the hospital in 2012 amid an investigation into the hospital’s spending practices by the Louisiana Legislative Auditor.

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Alford, who pleaded guilty in November, must also pay more than $1.3 million in restitution.

Two businessmen involved in the kickback scheme were also sentenced to prison time.

Tech Solutions owner Barney W.I. Hughes IV, 45, of Keller, Texas, was sentenced to 12 months in prison and ordered to pay $556,874 restitution, and Insurance World owner Henry Russell Ham, 65, of West Monroe, La., received 14 months in prison and must pay $817,000 restitution.

Both Hughes and Ham paid Alford a combined total of more than $1.3 million in kickbacks for his approval and continuation of their business agreements, U.S. Attorney Stephanie A. Finley said in a written release.

Madison Parish Hospital exclusively leased equipment and personnel from Tech Solutions to operate the hospital’s nuclear medicine and Ultrasound departments.

The hospital is a critical care facility that receives Medicare funds and is required by law to submit annual report cost report to Medicare. At no time did Alford or Hughes disclose to the hospital’s board or Medicare that they had an exclusive agreement, Finley said.

From October 2006 to June 2012, the hospital paid Hughes’ company $2,029,504, and in exchange for the contract, Hughes paid Alford $566,874, according to court records.

They submitted fraudulent cost reports to Medicare at least six times from December 2006 to 2011, Finley said.

From 2007 to 2012, Madison Parish Hospital purchased a majority of its health insurance and life insurance products from Ham’s company, according to court records.

Alford and Ham negotiated and set the insurance policy rates and Alford approved Ham’s billings as well as the hospital’s payments to Ham. The hospital paid Ham $4,979,487, and in return Ham paid Alford $817,000.

They submitted fraudulent cost reports to Medicare at least five times from December 2007 to 2011