Feds charge 7 people in $41 million health care scam run out of north Alabama pain clinic

Federal prosecutors charged seven people in a $41 million scam to defraud insurance companies, distribute illegal drugs and receive illegal kickbacks in an operation run out of a north Alabama pain clinic, the U.S. attorney’s office for the Northern District of Alabama said Wednesday.

Mark Murphy, 63, of Lewisburg, Tennessee, and his wife, 63-year-old Jennifer Murphy, owned and operated the North Alabama Pain Specialists clinic at the center of the alleged scheme, prosecutors said. They were charged in a 25-count federal indictment with conspiring to use the pain clinic to unlawfully distribute and dispense controlled substances and to use the illegal drugs to increase the number of patients at the clinic to profit from medically unnecessary services Mark Murphy ordered from them.

The Murphys and four others – Attalla resident Brian Bowman, 39; Christine Collins, 49, of Petersburg, Tennessee; Mark Murphy Jr., 33, of Lewisburg, Tennessee; and Willie Frank Murphy 67, also of Lewisburg – allegedly conspired in a scheme to pay and receive kickbacks and to defraud health care benefit programs including Medicare, Medicaid and private insurance companies out of $41 million for payment of items and services that were “medically unnecessary.” In some cases, the services or items, including office visits, medical equipment urine drug screenings and providing drugs, weren’t even provided, prosecutors alleged.

Jennifer Murphy allegedly used a fake charity to hide that she received illegal kickbacks and filed false tax returns to conceal the income generated from the fraud, according to prosecutors.

A seventh defendant, 67-year-old Lewisburg, Tennessee resident Sharon Lutrell, pleaded guilty to conspiracy to receive kickbacks. She was charged separately from the six other defendants.