TYLER, Texas – A husband and wife in Tyler, Texas, are facing the consequences after a brazen scheme to inflate billing to Medicare. Gerard Dengler, 61, and Suzanne Dengler, 52, were sentenced today for conspiring to commit health care fraud, a crime that siphoned funds from a vital federal program.
Gerard Dengler received 24 months in federal prison, while Suzanne Dengler will serve five years of probation. U.S. District Judge Thad Heartfield also ordered the couple to pay $161,695 in restitution – every penny of the loss inflicted upon Medicare. The guilty pleas were entered on January 10, 2017, but the reckoning came today.
The Denglers owned and operated Elite Lab Services, a clinical diagnostic laboratory servicing nursing homes across east Texas. The scheme, uncovered by investigators, centered around artificially inflating the mileage logged for lab services. From April to October 2014, Elite Lab systematically billed Medicare for inflated travel allowances, padding their profits at the expense of taxpayers.
The case didn’t begin with a federal raid, but a whistleblower. Karen Malcolm, a former employee of Elite Lab, filed a qui tam action, alleging widespread fraud dating back to 2010. The U.S. Attorney’s Office intervened, leading to a $3.75 million settlement. As part of that settlement, Elite Lab is barred from participating in Medicare for eight years. Gerard Dengler faces a 10-year exclusion, and Suzanne Dengler, eight years.
Federal investigators from the FBI, the U.S. Department of Health and Human Services – Office of the Inspector General (HHS-OIG), and the Texas Office of the Attorney General – Medicaid Fraud Control Unit (OAG-MFCU) built the case. Assistant U.S. Attorneys Frank Coan and Nathaniel Kummerfeld, along with Special Assistant U.S. Attorney Ken McGurk, prosecuted the criminal charges. The civil settlement was handled by Assistant U.S. Attorney Josh Russ, and civil forfeiture by Assistant U.S. Attorney Bob Wells.
While the maximum penalty under federal law is up to 10 years in prison, Judge Heartfield’s sentencing reflects the specific details of the crime and adherence to sentencing guidelines. This case serves as a stark reminder that defrauding federal healthcare programs will not be tolerated, and those who exploit the system will face prosecution and significant penalties.
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Key Facts
- State: Texas
- Agency: DOJ USAO
- Category: White Collar Crime
- Source: Official Source ↗
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