MADISON, Wis. (WFRV) – A Milwaukee man convicted of conspiracy to defraud Medicare and Medicaid will spend the next several years behind bars and pay restitution.

According to the United States Attorney’s Office Eastern District of Wisconsin, on November 18, David Guerrero Jr. was sentenced to 32 months in prison and will have to pay over $1 million to Medicare and Medicaid.

Guerrero Jr. worked at two Milwaukee-area medical clinics. Beginning in 2016, Guerrero Jr. engaged in a years-long scheme to refer patients to pharmacies owned by his co-defendant, Alexander Shister, for expensive compound pain creams in exchange for illegal kickback payments.

Although he is not a licensed medical provider, Guerrero Jr. used his access to private medical records at the clinics to identify patients who could plausibly need the pain creams and then ordered the pain creams from Shister’s pharmacies without the patient’s knowledge or consent.

As a result of the scheme, Medicare and Medicaid paid Shister’s pharmacies about $1 million for medically unnecessary pain creams, including creams not even received by the patients.

Guerrero Jr. received over $100,000 in kickbacks from Shister for his role in the scheme. In addition, Guerror Jr. engaged in another kickback scheme with a medical laboratory company, receiving over $150,000 in kickbacks in exchange for ordering urine drug tests that doctors at the clinics generally did not approve or review.

In August of 2022, Guerror Jr. pleaded guilty to one count of conspiracy. Shister has previously pleaded guilty for his role and will be sentenced on January 13, 2023.

At the sentencing, the judge emphasized the seriousness of Guerrero Jr’s crime, including the length of the fraudulent scheme and the significant losses suffered by the Medicare and Medicaid programs.

“Medicare and Medicaid only pay for medications and services that are actually needed to treat patients, not items ordered by individuals working in the medical field to line their own pockets,” said United States Attorney Haanstad.  “Guerrero took advantage of his access to patient’s private medical information to order millions of dollars of unnecessary pain creams and drug tests, all so that he could earn hundreds of thousands of dollars of illegal kickbacks.”

The judge noted that Guerrero Jr. violated the trust of patients by using their private medical information without their knowledge or consent in order to implement the scheme and earn his kickback payments.

“The defendant thought he could get away with criminal activity, accessing patient’s medical records without their knowledge and using that information for personal financial gain,” said FBI Special Agent in Charge Michael E. Hensle. “Working with his co-defendant, they conspired to receive significant payments of nearly $1 million from Medicare and Medicaid for unnecessary medical products.  They also received over $150,000 in kickbacks from a medical lab.  The FBI continues to stand with our local, state, and federal partners to identify, investigate, and bring these offenders to face justice.”

The Federal Bureau of Investigation and the Office of the Inspector General for the Department of Health and Human Services investigated the case.