Wound care has come far since the invention of the Band-Aid – like the amniotic tissue graft, a skin substitute product derived from the membrane of a donated placenta and found to be an effective treatment for chronic wounds that just won’t heal…also recently used by Alexandra Gehrke and Jeffrey King in a $1.2 billion dollar health care scheme where the Band-Aid would have been enough to heal.
Gehrke ran two companies, Apex Medical LLC and Viking Medical Consultants LLC, that contracted with medically untrained sales representatives. These representatives were financially incentivized to locate elderly patients, including hospice patients for whom they would then order amniotic wound grafts. The grafts were only ordered in sizes 4×6 centimeters or larger to maximize health insurance reimbursement even if the wound was smaller or almost nonexistent. Gehrke then referred these patients to her husband’s company, which contracted with nurse practitioners to apply the grafts.
Gehrke and King, who themselves had no medical training, ordered the nurse practitioners to apply all grafts ordered by the sales representatives, even when medically unreasonable and unnecessary. Between November 2022 and May 2024, the couple fraudulently submitted $1.212 billion in fake claims to Medicare, TRICARE (the health care program for U.S. service members and their families), CHAMPVA (the health care program for spouses and children of permanently disabled veterans), and commercial insurance plans for the grafts.
On January 31, 2025, King pleaded guilty to health care fraud. Gehrke had already pleaded guilty to the same charges on October 24, 2024. Both agreed to pay restitution in the amounts of $605,690,110 and $614,990,420 respectively.
Excellent job by the FBI in this case.
Today’s Fraud of The Day is based on article “Arizona couple pleads guilty to $1.2 billion in health care fraud” published by Arizona Family on January 31, 2025.
A Phoenix couple has pleaded guilty to a health care fraud scheme that prosecutors say conned Medicare and other insurance providers out of more than a billion dollars in less than two years. According to the U.S. Department of Justice, the couple made false and fraudulent claims for expensive, medically unnecessary treatment that were applied to elderly and terminally ill patients.
Federal officials identified the couple on Friday as Alexandra Gehrke, 39, and her husband, Jeffrey King, 46. Prosecutors say Gehrke ran two companies, Apex Medical LLC and Viking Medical Consultants LLC, with untrained sales representatives who would locate older patients and those in hospice who had wounds.
