Law Department alleges $9 million Medicaid fraud over addiction testing - Must Read Alaska
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Thursday, May 13, 2021
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Law Department alleges $9 million Medicaid fraud over addiction testing

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Criminal charges have been filed against Dr. John Zipperer, Jr. MD and his corporation Zipperer Medical Group for fraud against the state Medicaid program.

The State Department of Law alleges that Dr. Zipperer filed millions of dollars worth of claims for fraudulent laboratory urine tests performed from August of 2013 to August of 2015 and that his company, ZMG, performed over one million medically unnecessary laboratory tests on patients’ samples at a Tennessee lab he owned, billing Medicaid for those tests.

Zipperer practices “interventional pain” medicine. He is a graduate of Medical College of Georgia School of Medicine and specializes in pain and addiction treatment.

He opened a clinic in Wasilla in 2012 and expanded clinics across the state in Anchorage, Eagle River, and Fairbanks. In 2013, he opened a testing facility in Tennessee.

The State alleges ZMG would see patients as often as once every three day and would often require them to submit urine samples for testing, which would be done at the lab he owned.

The State says Zipperer would order dozens of unnecessary and duplicative tests on each urine sample and then bill Medicaid, private insurance companies, or cash-paying patients personally, at rates ranging from $3,000-$8,000 per urine sample.  

The red flag came after Zipperer was reimbursed about $9 million for laboratory testing between August 2013 and September 2015, an amount 10 times greater than the combined total of all other providers in the Alaska Medicaid system for laboratory test codes billed during the time period, according to the Law Department.

The case triggered a formal state audit review in 2018.  Throughout 2019, the state says Zipperer “failed to respond to repeated requests for supporting documentation for the millions of dollars worth of claims he submitted in response to agency requests.  This refusal itself is a criminal offense under Alaska law.” 

In 2015, Zipperer closed his methadone clinic in Wasilla after saying he was unable to adequately staff the clinic, in part because of an FBI investigation into the clinic practices. Methadone is a replacement to narcotics that suppresses withdrawal symptoms and helps wean people off of opioids. Treatment with methadone can last for years.

The charging document may be found on the State of Alaska, Medicaid Fraud Control Unit.

The charges against Zipperer carry a possible sentence of up to 10 years in prison, a fine of up to $100,000 and restitution to the State of Alaska Medicaid program.  The charges of medical assistance fraud against the corporation carry a possible maximum sentence of up to $5 million, and a potential restitution order. 

Any person who may have information about Dr. Zipperer or facts related to this case are encouraged to contact the State of Alaska, Medicaid Fraud Control Unit at (907) 269-6279.

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Suzanne Downing had careers in business and journalism before serving as the Director of Faith and Community-based Initiatives for Florida Gov. Jeb Bush and returning to Alaska to serve as speechwriter for Gov. Sean Parnell. Born on the Oregon coast, she moved to Alaska in 1969.

Latest comments

  • Three years to move on it. The money is long gone and will never be recovered. Somebody, maybe just some lowly billing clerk, will do some time. Nobody in DHSS, the department where competence goes to die, will even get a memo in their file over it. This is how DHSS became the most expensive department in State government.

  • I know all too well the alleged scamming by Dr. Zipperer and his black mark on legitimate treatment of opioid addiction. As a treatment provider we helped those who went through the “Zipperer machine.”
    What surprises me the most is though his procedure code billing amount and protocol was outrageous, and was far and beyond what is the standard in Alaska, but why did the State Medicaid pay him the money in the first place then questioned it later with the expectation to be reimbursed. Frustrating that the State system did not signal and alert of questionable reimbursement to stop payment before it went out. This needs to change before another doctor or contractor abuses our resources which threaten to help Alaskans.

    Oh, and amid ongoing investigations, closure of his clinics, and removed from insurance panels that the State of Alaska continues to recognize his professional license as a physician.

  • Medicaid/Medicare billing & the deliberately confusing codes that are used is low hanging fruit for billing fraud. And guess what? The criminal healthcare industry hires an army of lobbyists to bribe our lawmakers to keep it so.

  • Well… it appears the State just pissed away a load of ca$h! $9,000 for a urine test??! Anyone ever review these claims?

    • Maybe it’s $90 ?

  • Medicaid is fraught with fraud, and as government money means even less in Alaska than in other states it’s not surprising that this fellow would strike here. Look at the hotels in mid-town Anchorage that exist just to sap off Medicaid travel money; is that worse, the same or not as bad as this scamming physician? It’s we taxpayers who are the fools. We need to reduce Medicaid in Alaska to a level such that Medicaid users relocate to another state; that is the only way to solve this problem. Medicaid is the symptom; the problem is the lame and the lazy sapping off the rest of us. If we relocated these indigents then our economy would benefit greatly as the Medicaid users tend to also receive get government housing, government food, government cell phones, government electricity subsidies, etc. etc. And at least some of them are drunk out of their minds in mid-town Anchorage every day. Medicaid gives the rest of us the moral license to scam government whenever and wherever we can – otherwise feeling like the fools we taxpayers really are will eat us up.

    • Kubota2: It’s not the Medicaid system this issue pertains to. The issue is a fraudulent physician — well known in the valley for being a physician to avoid. Fraud not a surprise.

      Youre diatribe/ rant about Medicaid is irrelevant. You’re commiting a cardinal sin via the assumptions you make, born from ignorance or perhaps indifference, or an equal amount of each. The biggest ripoff to the Alaska taxpayer are all the Native demand for more and more state monies for a myriad of free services to Natives, including Medicaid-paid travel from the villages, which is an extremely costly perk only awarded to Natives. Every Native Corp ought to be responsible for the support of their own people. These are extremely wealthy entities, a majority of which are multi-billion dollar corporations. If they took care of their own people — not the state/ Alaska taxpayer — the state would be in the black.

      Furthermore, by ranting about Medicaid recipients and ignoring the issue at hand, you’re essentially giving the fraudulent doctor a pass.

  • Another great look at the responsible state government and how they look after the money. Remember the money belongs to all of us not the state. And to think there are people who want to give them more and tax us that can see the scam a mile away.

  • What a great example of the state being good money managers of the cash. Remember the money is ours not the states. And just think there are people out there that want to give the state more money to waste by taxing us. Who are the smart ones now.

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