<h2>Federal Jury finds Defendants Guilty of Submitting False Claims to Medicare under Civil False Claims Act</h2>
<p><strong>Jury verdict results in recovery of more than $10.85 million to the Medicare program</strong></p>
<p>Gulfport, Miss. – Following a nine week trial, a federal jury in Gulfport returned a guilty verdict yesterday against Ted and Julie Cain of Ocean Springs, Ted Cain’s companies, Stone County Hospital (Wiggins) and Corporate Management, Inc. (Gulfport), and Tommy Kuluz, Chief Financial Officer of Corporate Management, Inc. for violating the Civil False Claims Act, announced U.S. Attorney Mike Hurst and Derrick Jackson, Special Agent in Charge of the Office of Inspector General for the U.S. Department of Health and Human Services.</p>
<p>“This verdict is a victory for the American taxpayer and all the beneficiaries of Medicare and other government programs,” said U.S. Attorney Mike Hurst. “This was one of the most egregious cases of Medicare fraud we have litigated in the State of Mississippi, and I am grateful to our prosecutors and DOJ attorneys and investigators for tenaciously pursuing and holding these fraud takers accountable. We will remain vigilant in protecting American taxpayer dollars and rooting out waste, fraud and abuse throughout government.”</p>
<p>The Government’s complaint and evidence at trial established that these defendants used Stone County Hospital, formerly a 25-bed critical access hospital and Medicare provider, to defraud Medicare of more than $10.85 million through fraudulent annual Medicare cost reports for the years 2004 through 2015. The majority of the damages sustained by the Government resulted from Ted Cain’s multi-million dollar compensation, billed to Medicare through Stone County Hospital and Corporate Management, Inc. For years, Corporate Management, Inc. passed on the vast majority of Ted Cain’s multi-million dollar compensation to Stone County Hospital, which Medicare reimbursed for costs at 101% from 2004 through April 1, 2013, and 99% from April 1, 2013 through 2015 under special reimbursement principles for critical access hospitals that help rural, underserved areas. For the cost reporting years 2004 to 2015, Corporate Management, Inc., through Ted Cain and Tommy Kuluz, assisted by Julie Cain, requested more than $17.69 million in compensation for Ted Cain despite no evidence that Ted Cain did any work for Stone County Hospital that qualified for Medicare reimbursement and that his compensation was unreasonable. In total, Medicare reimbursed Stone County Hospital nearly $11.8 million for Ted Cain’s compensation. The jury awarded the Government nearly $9.62 million in damages for Ted Cain’s fraudulent compensation.</p>
<p>Ted Cain’s wife, Julie Cain, who Ted Cain placed in the position of Administrator for Stone County Hospital from 2003 to 2012, also fraudulently received more than $704,454 in compensation reimbursed by Medicare. The evidence at trial showed that Julie Cain rarely worked at Stone County Hospital, while others ran the hospital, and Julie Cain’s compensation was unreasonable. After Julie Cain resigned as the Administrator of Stone County Hospital, she immediately started receiving compensation from Corporate Management, Inc. for alleged consulting work and director’s fees. Neither Julie Cain nor any other defendant could identify any consulting work she did for Stone County Hospital. Medicare reimbursed $149,510 in Julie Cain’s fraudulently obtained compensation for consulting and director’s fees. The jury awarded the Government a total of $853,964 in fraudulent compensation paid for Julie Cain.</p>
<p>Moreover, an audit conducted by the Mississippi Division of Medicaid found that for 2012 and 2013, Corporate Management, Inc., self-disallowed home office costs on its Medicaid home office statement but charged those costs on its Medicare home office statement, despite that Medicare and Medicaid follow the same reimbursement rules. Chief <a class="wpil_keyword_link" href="https://www.fraudswatch.com/tag/financial-fraud/" title="Financial" data-wpil-keyword-link="linked" data-wpil-monitor-id="955">Financial</a> Officer Tommy Kuluz could provide no explanation for this discrepancy, and despite the fact that he knew about the discrepancies at least by 2016 when Medicaid conducted an audit, defendants made no effort to repay Medicare for the over-allocation to Stone County Hospital. Because of this fraud, Medicare reimbursed Stone County Hospital more than $381,866 in fraudulent costs that it should not have.</p>
<p>The jury made a number of findings in its verdict, resulting in recovery of more than $10.85 million to the Medicare program. Damages are trebled under the False Claims Act. The Court also imposes a statutory penalty of $5,500 to $11,000 for each false claim for cost report years 2004 to 2014 and $11,181 to $22,363 for the 2015 cost report. Accordingly, the total amount of defendants’ civil liability will be determined by the Court, using the findings in the jury’s verdict.</p>
<p>The jury’s verdict resolves a lawsuit that was filed by James Aldridge under the qui tam or “whistleblower” provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Government investigated and intervened in the lawsuit and prosecuted the case. The case is captioned United States ex rel. Aldridge v. Corporate Management, Inc., et al., Case No. 1:16cv369-HTW-LRA (S.D. Miss.). The United States appreciates the relator’s interest in program integrity and his assistance with this successful outcome. The United States also appreciates the assistance of the Mississippi Division of Medicaid and Manuel Pilgrim, who heads its audit program. The Department of Health and Human Services Office of Inspector General also provided assistance in the case.</p>
<p>The case was prosecuted by Assistant U.S. Attorney Angela Givens Williams and Attorneys Tom Morris and Elspeth A. England with the Civil Fraud Section of the Commercial Litigation Branch of the U.S. Department of Justice in Washington, D.C.</p>

Health Care Fraud: Ted and Julie Cain of Ocean Springs Finds Guilty Of Submitting False Claims to Medicare
FraudsWatch is а site reporting on fraud and scammers on internet, in financial services and personal. Providing a daily news service publishes articles contributed by experts; is widely reported in thе latest compliance requirements, and offers very broad coverage of thе latest online theft cases, pending investigations and threats of fraud.
Leave a Comment


The Ultimate Guide to Avoiding Online Scams
Stay safe online! Our comprehensive 2025 guide covers phishing, AI scams, investment fraud & more. Learn red flags, prevention steps & how to report scams. Protect yourself now via Fraudswatch.com.
Read More
Categories
- AOL Aim Live ATT
- Celebrities Scammed
- Credit Card
- Credit Scam
- Email Man-Male Scammers
- Email Scam List
- Email Scams Examples
- Fraud
- Fraud News From World
- Fraud Prevention
- Gmail.com
- Hotmail.com
- Insurance
- Jobsearch Scams
- Loans
- Military Scammer
- Mortgage
- Nigerian 419
- Report Fraud
- Romance Scammer
- Russian Email Scam
- Scammer
- Scams Ways
- Shopping & Saving Money
- Spam
- White-Collar Crime
- Yahoo.com
Recent Posts
- Bulletproof Betrayal: Inside the $5.2 Million ShotStop Fraud That Sold Counterfeit Body Armor to America’s Law Enforcement July 8, 2025
- The Weapon of Experience: Inside the $28M Memphis Pharmacy Fraud and a Prior Conviction at the Heart of a Record-Breaking National Takedown July 2, 2025
- Chicago Businessman Convicted in $55 Million Fraud Scheme Targeting COVID-19 Relief Funds and Financial Institutions July 2, 2025
- Betrayal in the Classroom: An In-Depth Analysis of the Unprecedented Criminal Charges Against the School District of Philadelphia for Asbestos Failures June 28, 2025
- Anatomy of a Scandal: How a NY Governor’s Aide Allegedly Masterminded an $8M COVID PPE Fraud and Kickback Scheme June 28, 2025
Tags
Bank Fraud
Banking Fraud
Bankruptcy Fraud
Bribery Scheme
Business Fraud
Celebrities Scammed
Charity Fraud
Commodities Fraud
Consumer Fraud
Consumer Protection
COVID-19 relief fraud
Credit
Credit card
Credit Card Fraud
Credit Repair
Credit Repair Scams
Crime
Cyber Crime
Cybercrime
Cyber Criminals
Cybersecurity
data breach
Dating Scammer
Elder Fraud
Elder Justice
Email
Email Letter
Email Scam
Email Scam Examamples
Email Scam Example
Email Scam Examples
Email Scams
Email Scams Examples
False Claims Act
FBI
Fedex
Financial Crime
Financial Fraud
Fraud
fraud prevention
Fraud Scheme
Health
Health and Wellness Scams
Health Care Fraud
Healthcare Fraud
Identity Theft
Immigration Fraud
Insurance
Insurance Fraud
Internet Fraud
Investment Fraud
job
Job Scam
job scams
Loan
Loan Fraud
Loan Scam
Loans Fraud
Lottery Scam
Mail Fraud
Medicare Fraud
Microsoft
Military Scammer
Military Scammer LT. JEFFREY MILLER
Military Scammers
Money Laundering
Money Laundering Scheme
Mortgage
Mortgage Fraud
Mortgage Scam
Mortgage Scams
National Security
Nigerian
Nigerian 419
Nigerian Scam
online fraud
Online Scams
PayPal
personal information
Phishing
Phishing Scams
Ponzi Scheme
Public Corruption
Ransomware
Report Fraud
Romance Scam
Romance Scammer
Romance Scammers
Romance Scams
Scam
Scammer
Scammers
scams
Securities Fraud
spam
Tax Evasion
Tax Fraud
Travel Scams
White Collar Crimes
wire fraud