Former Rogers company owner, former CEO sentenced to prison time and $8 million in damages

ROGERS, Ark. (KNWA/KFTA) — The former owner of a medical supply and billing company in Rogers, as well as its former chief executive officer were sentenced on Tuesday for their roles in three separate conspiracies to defraud the U.S. government and private workers’ compensation insurers, according to a press release from the U.S. Attorney’s Office for the Western District of Arkansas.

Hunter Burroughs, 44, and Stephen Andrews, 50, were the two former executives for the Rogers-based company who were sentenced in Tuesday’s trial.

The press release said the two committed acts of defrauding both federal and private workers’ compensation insurers by way of a billing and kickback fraud scheme involving multiple physicians and medical clinics.

This includes two Louisiana physicians, who received medications from Arkansas which goes against Louisiana law.

According to the document, Burroughs will receive four years in federal prison, followed by a three-year term of supervised release.

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Burroughs is also ordered to pay around $3.5 million in restitution, primarily to the U.S. Department of Labor and the Office of Workers’ Compensation Programs. The judge also ordered he pay forfeiture of about $4 million representing his unlawful gain from the scheme, as well as a $25,000 fine.

Andrews will serve 32 months of incarceration followed by a three-year term of supervised release.

According to the press release, Andrews was ordered to pay around $2.3 million in restitution, and close to $500,000 in forfeiture.

“The basic premise of the health care fraud scheme was that Burroughs, Andrews, and other individuals associated with the Rogers company recruited physicians to dispense pain creams and patches to their workers’ compensation patients by offering them a split of the profits collected from successfully billing insurers, typically 50 percent,” the press release said.

Burroughs and Andrews would use the company in Rogers as the billing agent for physicians, handling all paperwork and submitting fraudulent claims to the U.S. Department of Labor, Office of Workers’ Compensation Programs and private insurers.

The press release said the company would bill insurers anywhere from 15 to 20 times what the medications cost, and then paid physicians kickbacks on collected amounts.

The company’s former billing director, Amanda Rains, pleaded guilty for her role in the conspiracy in 2021. She still awaits her sentencing.

The court also found Burroughs and Andrews guilty of conspiring with Louisiana physicians Dale Bernauer Sr. and Robert Smith to have the Rogers company ship medications to Louisiana, despite knowing neither physician had the correct license to dispense medications from his clinic legally.

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Bernauer pleaded guilty to his role in the conspiracy in 2021 and paid around $600,000 to the Office of Workers’ Compensation Programs for his portion of the loss. He still awaits his sentencing.

Smith pleaded guilty in 2022 but later tried to withdraw his guilty plea, failed and was sentenced to four years incarceration, according to the press release. He also paid around $800,000 in restitution for his shared responsibility for the crime.

This brings a close to the criminal case against Burroughs and Andrews that began in Feb. 2022. Collectively, the two must pay over $8 million in restitution and forfeitures.

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