Paxton Medicaid Fraud Investigation Leads to $1.1 Million Reimbursement to Health Programs

Austin, TX — An investigation by Attorney General Paxton’s Medicaid Fraud Unit resulted in two individuals being convicted of health care fraud in federal court in Del Rio, Texas.

Melody Ann Villarreal and Oscar Gutierrez Jr. were found guilty of providing fraudulent mileage records for failed ambulance transfers and providing them to Medicare and Medicaid for payment.

Villarreal and Gutierrez were ordered to pay $907,376.41 in Medicare damages and $218,651.23 Medicaid. Villarreal was sentenced to 48 months in prison, followed by a supervised release of three years, while Gutiérrez was sentenced to 60 months in prison, followed by a supervised release of three years.

“My office will continue to prosecute those who commit fraud, increase the cost of health care for Texans, and attempt to compromise the integrity of our healthcare system,” Attorney General Paxton said. “I am proud that the hard work of my Medicaid Fraud Unit and our law enforcement partners has ensured justice in this case and the return of Texas taxpayers.”

The case was investigated by Lt. Jeff Winney, Investigating Auditor Michael Youngs, and Capt. Raul Gonzalez of the Medicaid Fraud Unit, in cooperation with the Department of Health and Human Services’ Office of the Inspector General and the FBI. The case was handled by Assistant U.S. Attorney Rex Beasley of the Western District of Texas.

The Texas Medicaid Fraud Unit is responsible for investigating and prosecuting cases of Medicaid fraud, neglect, and patient abuse. If you suspect Medicaid fraud or abuse or patient neglect, call (512) 371-4700 or visit the Texas Attorney General’s website.