Ronald Coburn, Healthcare Fraud and Tax Evasion, Kentucky 2023

Lexington, KY – LabTox owner Ronald Coburn, 76, pleaded guilty on Tuesday to healthcare fraud and tax evasion in federal court.

Coburn admitted to causing healthcare fraud by billing Medicare and Kentucky Medicaid for medically unnecessary urine drug testing services. He also admitted to concealing his income and tax evasion by placing the business in the name of his partner.

Between June 2019 and March 2021, Coburn’s lab, LabTox, obtained $1,864,429 in fraudulent payments from Medicare and Kentucky Medicaid. Coburn also agreed to repay this money to Medicare and Kentucky Medicaid as part of his plea agreement.

Coburn’s plea agreement also obligates him to pay $3,566,645 to the IRS, representing income tax he owed in 2017 through 2021.

The investigation was conducted by the FBI, HHS-OIG, and IRS. The United States was represented by Assistant U.S. Attorneys Andrea Mattingly-Williams and Paul McCaffrey.

Ronald Coburn and his compliance officer, Erica Baker, 31, are both scheduled to be sentenced on December 18, 2023. Both face a maximum of 10 years in prison and a fine of up to $250,000. However, any sentence will be imposed by the Court, after its consideration of the U.S. Sentencing Guidelines and the federal sentencing statutes.

Carlton S. Shier, IV, United States Attorney for the Eastern District of Kentucky, announced the guilty pleas. He was joined by Brian Jones, Acting Special Agent in Charge, FBI, Louisville Field Office; Tamala E. Miles, Special Agent in Charge, Department of Health and Human Services, Office of Inspector General, Atlanta Field Office; and Bryant Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation, Cincinnati Field Office.

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