Carrie Musselman, Medicare Scam, Illinois 2025

PEORIA, Ill. – Carrie Musselman, 48, of Eureka, Illinois, is headed to federal prison after being sentenced to 20 months on June 24, 2025, for a brazen scheme to fleece Medicare and twelve other insurance companies out of over $2.5 million. The jury delivered a guilty verdict in February 2025, finding Musselman guilty of one count of healthcare fraud and five counts of wire fraud after a grueling 13-day trial.

The evidence presented before Senior U.S. District Judge Michael M. Mihm painted a picture of a calculated, multi-year fraud. Musselman, a chiropractor, systematically submitted bogus insurance claims, falsely claiming services were performed by doctors when, in reality, they were carried out by lower-level providers. This inflated billing netted her illicit profits she wasn’t entitled to, a cold-blooded grab for cash at the expense of a vital healthcare system.

But the deception didn’t stop there. Musselman also fabricated patient records, billing for services never rendered. One particularly disturbing tactic involved falsely claiming allergy injections were administered, when patients were simply sent home with unapproved, “experimental” oral drops. These drops hadn’t been proven effective – a dangerous gamble with patient health fueled by greed. She also misrepresented the services *actually* provided, further padding her pockets.

A key component of the fraud centered around the billing for an electroacupuncture device. Musselman falsely labeled it as a surgically implanted neurostimulator, a misrepresentation that allowed her to collect payments that would have otherwise been denied. Judge Mihm didn’t buy her explanations, finding Musselman committed perjury during her testimony, and explicitly stating she was fully aware of the fraudulent activity she directed. She wasn’t just a participant; she was the architect of the scheme.

“This case should serve as a warning to anyone who would commit fraud against health insurance,” declared Acting United States Attorney Gregory M. Gilmore. “We will seek out fraud, waste, and abuse and prosecute those who engage in it. Providers who take advantage of the trust placed in them to line their own pockets abandon their ethical responsibilities and raise health insurance costs for vulnerable patients.” Linda T. Hanley, Special Agent in Charge with the United States Department of Health and Human Services Office of Inspector General, added, “The submission of false claims undermines the integrity of our federal healthcare system.”

FBI Springfield Field Office Special Agent in Charge Christopher J.S. Johnson put it bluntly: “Bad actors in healthcare…think they can cover up fraud through clouded paperwork…all while they commit illegal acts.” The investigation was a joint effort by the Department of Health and Human Services, Office of Inspector General, and the FBI. Assistant U.S. Attorneys Douglas F. McMeyer, Bryan D. Freres, and Grace J. Hitzeman secured the conviction and restitution order. Musselman will also be required to repay more than $2.3 million to cover the damage she inflicted on the system.

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