Oklahoma Mother, Son Plead Guilty to $770K Medicaid Fraud

Oklahoma City mother and son DEBORAH A. GRAY, 60, and KEITH B. GRAY, II, 26, pled guilty yesterday to robbing Medicaid of nearly $770,000 through a web of lies spun from their sham counseling business. The pair admitted to three counts each of health care fraud, capping a years-long scheme that exploited vulnerable children and gutted public funds meant for their care.

The indictment, handed down July 6, 2016, charged the Grays with 151 counts of fraud tied to DAG Counseling Services, PLLC, a company Deborah Gray owned and operated from October 2011 through May 2014. Posing as a behavioral health provider for Medicaid-eligible youth, the business was instead a billing mill built on falsified records, phantom services, and outright theft.

Investigators say the Grays ran three distinct fraud schemes. First, they billed Medicaid for ‘targeted case management services’ while kids were merely in transit—shuttled between home, school, and the office—services explicitly barred under Medicaid rules. Second, they routinely billed more than the 90-minute daily maximum for one-on-one ‘psychosocial rehabilitation services.’ Third, they submitted claims for services that were either never delivered, provided in groups, or drastically shorter than billed.

KEITH B. GRAY, II, listed as an employee of DAG Counseling, played a central role in executing the fraud. Together, the mother and son admitted to carrying out each of the three schemes, knowingly falsifying time logs, attendance records, and Medicaid submissions to siphon money from the state-federal program.

As part of their plea agreement, both DEBORAH A. GRAY and KEITH B. GRAY, II, agreed to pay restitution totaling $769,578.38. At sentencing—expected in approximately 90 days—they each face up to 10 years in federal prison per count, plus three years of supervised release and a $250,000 fine per count.

The case was jointly investigated by the Federal Bureau of Investigation and the Oklahoma Attorney General’s Office Medicaid Fraud Control Unit. Prosecuted by Assistant U.S. Attorney Amanda Maxfield Green and Oklahoma Assistant Attorney General Lory Dewey, the takedown underscores growing scrutiny of fraud draining Oklahoma’s Medicaid system, funded by both federal and state taxpayers and administered by the Oklahoma Health Care Authority.

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