Attorney General Suthers Announces Guilty Plea In Medicaid Scam

DENVER – Colorado Attorney General John Suthers today announced that Daniel Arnold, age 51, has pled guilty to charges of racketeering, theft, and forgery for his role in allegedly stealing more than $1 million from the Colorado Medicaid system between 2000 and 2005.

An Adams County grand jury indicted Arnold on September 14, 2006, after an extensive investigation of D&D Medical of Aurora. Arnold owned and managed D&D, which supplied wheelchairs and parts, and also repaired power wheelchairs. A large percentage of D&D’s business was for disabled individuals whose wheelchair services were covered by Colorado Medicaid.

The State alleged that D&D billed Medicaid for hundreds of thousands of dollars in wheelchair repair services that took only a small fraction of the time claimed. The company also submitted a very large number of billings to Medicaid for services that never occurred, which was confirmed by interviews with numerous recipients. To accomplish the fraud, employees allegedly printed false work orders and documented false repair times to permit the unjustified billing. Arnold was also accused of falsifying manufacturer invoices to inflate the company’s reimbursement for new wheelchairs and their parts and accessories.

Arnold pled guilty to four counts, including violation of the Colorado Organized Crime Control Act, a class 2 felony; Theft Over $15,000, a class 3 felony; Theft between $500 and $15,000, a class 4 felony; and Forgery, a class 5 felony. Under the plea agreement, Arnold could receive up to 16 years in prison.  The agreement also requires him to repay over $1 million in restitution to the State. Sentencing is scheduled for May 7.

A number of Arnold’s former employees also pled guilty in the scheme, including William Humprhies, who received a five year prison term, Carl Nunn, whose judgment was deferred, and Karen Bittner, who received a probationary sentence.

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