Amtrak bilked out of $12M by at least 119 employees, doctors in fraud scheme; many still on the job: report

At least 119 Amtrak employees and doctors took the railroad company for a ride in a massive $12 million health fraud scheme, a watchdog found. 

Amtrak’s Office of Inspector General (OIG) said employees based in Pennsylvania, Delaware, New Jersey, New York, Maryland, Connecticut and Washington, D.C., accepted cash kickbacks from three healthcare providers in exchange for the use of their insurance information and that of their dependents in a scheme from 2019 to 2022.

“The sheer volume of employees who cavalierly participated in this scheme to steal Amtrak’s funds suggests not only a serious lapse in basic ethics, but a troubling workforce culture, at least in the Northeast region, in which blatant criminal behavior was somehow normalized,” said Amtrak Inspector General Kevin H. Winters. 

Fox News Digital has reached out to Amtrak. 

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The healthcare providers used that employee information to file fraudulent and questionable medical claims for services that were never provided or not medically necessary, the OIG said. Overall, the taxpayer-funded railroad carrier’s health plan was billed more than $16 million and was bilked out of $12 million. 

Of the 119 employees implicated, 28 retired or resigned as a result of the OIG’s investigation, and 30 left the company for “other reasons.” Another dozen employees have been criminally charged, and seven have pleaded guilty and are awaiting sentencing.

Sixty-one are still on the job. 

In a statement to Fox News Digital, Amtrak said it has taken “significant steps” to address medical insurance fraud. 

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“Like many employers, Amtrak calls on medical benefit providers and insurers to do more to identify suspicious activity and stop medical insurance fraud,” the company said. “Amtrak strongly condemns this reprehensible act that occurred between 2019 and 2022 and is taking swift action with all active employees involved in the investigation. 

“While we continue to work closely with the OIG to identify and stamp out fraud, we also continue to work on other initiatives to address this issue,” the statement added. “Amtrak has implemented various measures to enhance fraud prevention and empower employees to report suspected wrongdoing. These efforts include increasing oversight and strengthening efforts to eliminate fraudulent schemes.”

The OIG launched a probe when an agent noticed unusual billing patterns in reports by data analysts. Three New York healthcare providers with “questionable” billings who shared a high number of Amtrak employees as patients were identified by investigators. 

An undercover agent posing as an Amtrak employee met with Punson Figueroa, aka “Susie,” an acupuncturist from Long Island City, New York, June 16, 2021. During the visit, Figueroa told the agent to sign his name 30 times for service without dating the signatures, the OIG said. 

Figueroa then submitted alleged fraudulent claims to Amtrak’s healthcare plan, saying the agent had visited providers at least seven times in May 2021 for acupuncture and physical therapy. The agent visited Figueroa’s office again on July 29, 2021, where she allegedly handed him an envelope containing $1,000. 

Figueroa continued to use the agent’s insurance information to submit dozens of fraudulent claims to Amtrak’s healthcare plan, investigators said. 

Figueroa pleaded guilty to defrauding Amtrak’s healthcare plan, was sentenced to three years of supervised release and was ordered to pay restitution of $9.05 million. Two other healthcare providers and a medical biller have also pleaded guilty for their roles in the scheme.

Michael DeNicola, a podiatrist from New York, pleaded guilty June 29, 2022, to conspiracy to commit health care fraud, distribution of a controlled substance and unlawful possession of a gun. He has not yet been sentenced. 

Regina Choi, a medical biller from Woodside, New York, who previously worked for Figueroa, pleaded guilty to conspiracy to commit health care fraud June 11, 2024, for submitting false and fraudulent claims to the Amtrak health care plan and paying cash kickbacks to Amtrak employees. Her sentence is also pending. 

In 2018 and 2019, OIG auditors issued separate reports that said Amtrak could strengthen measures to identify fraudulent medical claims sooner. Both reports noted billing patterns indicative of potential fraud among hundreds of providers, the OIG said.