Kentucky Clinic Owners Convicted on Health Fraud Charges Including a Clinic in Eastern Kentucky

According to court records, a jury has convicted Barbie Vanhoose, Michael Bregenzer, and Dr. Jose Alzadon, one charge each of conspiracy to commit health care fraud; eight counts each of health care fraud, and one charge of conspiracy to illegally distribute drugs, with Alzadon and Vanhoose having been charged with two additional charges related to using the identity of another person in writing prescriptions. Bregenzer was acquitted on those charges.

Kentucky Addiction Centers, a group of clinics that offered treatment for substance use disorder using Buprenorphine, commonly known by the name Suboxone, had offices in Winchester and Paintsville. Buprenorphine/Suboxone helps withdrawal from opioid drugs such as heroin, oxycodone and fentanyl, but can also be abused.

Alzadon worked as a doctor at the business, and Vanhoose was the billing and compliance manager. Bregenzer was a part owner. 

According to court records, federal authorities charged that between October 2017 and December 2020,  Vanhoose, Alzadon, and Bregenzer took part in a scheme to submit false bills to programs that included Medicare and Medicaid.

The scheme included 1. Seeking payment for services that were more costly than those actually provided to clients, 2. Billing for services that weren’t provided, 3. Submitting bills in the name of a doctor who didn’t do the work; and 4. Agreeing to write prescriptions for Suboxone in the name of a doctor who wasn’t seeing the patients, according to authorities.

According to court records, Alzadon, Bregenzer and Vanhoose denied the charges, but the jury convicted them on March 20th, after deliberating less than four hours. The most serious charge against the three has a maximum sentence of 20 years in prison. U.S. District Judge Karen C. Caldwell scheduled them to be sentenced in June of this year.

Kentucky Addiction Clinics other owner, Kristy Berry, was initially charged, but pleaded guilty in December 2023 to charges of conspiring to commit health care fraud and to illegally distribute drugs. Her plea agreement said the fraud resulted in a combined loss of $814,820 to Medicaid and Medicare, according to authorities.