Shelby County woman arrested in $500,000 Medicaid fraud case

MONTGOMERY, AL (WBRC) - A Shelby County woman has been arrested in connection with Medicaid fraud and the theft of more than a half million dollars.

Attorney General Troy King, in a statement Tuesday to FOX6 News, said Joan Elizabeth Corbitt Johnson, 38, was arrested Tuesday at a Birmingham-area hotel by the U.S. Marshals.

The arrest came after a grand jury in Montgomery indicted Johnson with 419 counts of Medicaid fraud and with stealing $609,496 from the Alabama Medicaid Agency.

"This case involves allegations of a major scheme to exploit the Medicaid system for large amounts of money and to steal funds that are vital for the State of Alabama to provide care and assistance to meet real and desperate needs," said Attorney General King in the statement.

The indictments charge that, while working as the manager for Advantage Medical Supply in Troy, Alabama, a business owned by Johnson's husband and brother-in-law, Johnson billed the Medicaid Agency 419 times for 11 different types of custom ankle, knee, leg and wrist braces that were never prescribed for nor delivered to 125 Medicaid recipients.  Each recipient was billed for a minimum of two braces, with one recipient being billed for 22 different leg braces over a two year period. Medicaid paid between $300 and $1,100 per brace.

If convicted, Johnson faces a potential penalty of one to 10 years imprisonment and fines of up to $15,000 for each of the 419 counts of Medicaid fraud, and two to 20 years and a fine of up to $30,000 for the charge of first-degree theft.

Johnson was transferred to the Shelby County Jail where she is being held on bonds totaling $444,000.  

Copyright 2010 WBRC. All rights reserved.