A former NFL star turned genetic testing lab owner is facing the fallout after a federal jury in Dallas convicted him of masterminding one of the nation’s largest genetic testing scams, racking up $328 million in bogus Medicare claims and leaving taxpayers on the hook for tens of millions.
Inside the Case
Keith J. Gray, 39, of McKinney, Texas, allegedly turned his lab into a money machine, billing for cardiovascular genetic tests that never delivered.
A jury in Dallas convicted Gray on Feb. 20 for his role in the scheme, and he now faces up to 10 years in prison on each count, with sentencing yet to be scheduled.
According to the Department of Justice, Gray, the owner and operator of two clinical laboratories, Axis Professional Labs LLC and Kingdom Health Laboratory LLC, was found guilty of conspiracy to defraud the United States and to pay and receive health care kickbacks, five counts of violating the Anti-Kickback Statute, and three counts of money laundering, according to Law.com.
The DOJ said Gray offered and paid kickbacks to marketers in exchange for their referral of Medicare beneficiaries’ DNA samples, personally identifiable information, including Medicare numbers, and signed test orders from medical providers authorizing the medically unnecessary genetic tests.
Authorities said Axis and Kingdom submitted approximately $328 million in fraudulent claims to Medicare, which paid out about $54 million before the scheme was uncovered, according to ABC Birmingham.
Marketers used telemarketing campaigns to target seniors and engaged in “doctor chasing,” pressuring primary care physicians to authorize tests for patients pre-screened by non-medical personnel.
To conceal the kickbacks, Gray allegedly used “sham contracts” and falsified invoices labeled as marketing services, with evidence showing he referred to some payments as “software” fees or nonexistent loans, according to ABC Birmingham.
Jurors were shown text messages between Gray and a co-conspirator celebrating Medicare reimbursements, including one where the co-conspirator wrote “$ent, you should have it any minute if you don’t already. Get it?” and Gray responded “Sorry I was filling my bathtub with ones. Yes lol,” according to ABC.
The U.S. Department of Justice claim Gray laundered some of the proceeds by purchasing expensive luxury vehicles, including a Dodge Ram truck worth more than $142,000 and a Mercedes Benz SUV worth more than $145,000.
Federal officials said the prosecution is part of the DOJ’s broader Health Care Fraud Strike Force Program, which has charged more than 6,200 defendants accused of billing federal health programs and private insurers more than $45 billion since 2007.