TennCare Fraud Convictions: Claiborne, Overton and Lawrence Counties

NASHVILLE - Three people have pleaded guilty in separate cases involving TennCare fraud – stretching from Five Points to New Tazewell, Tennessee.

The Office of Inspector General (OIG) today announced the convictions, all three involving people selling portions of prescription medications obtained through fraudulent use of TennCare benefits.

Jerry Peden, 35, of Five Points, was arrested in May of this year, charged with selling Morphine he had obtained using TennCare. Peden pleaded guilty to one count of TennCare fraud and one count of selling a Schedule II controlled substance. He received a sentence of three years judicial diversion and was ordered to pay a $2,000 fine.

Christy Staggs, 35, of Overton County, was arrested October 2007 on charges of presenting a pharmacy with forged prescriptions for Avinza, a form of Morphine, and Alprazolam, the anti-anxiety medication also known as Xanax, and using TennCare to pay for the drugs. Staggs pleaded guilty to one count of TennCare fraud, receiving two years probation and she was ordered to pay almost a thousand dollars in restitution to TennCare. The court also ordered that Staggs cannot enroll in TennCare for a period of two years from the date of the plea.

Sabrina Howell, 29, of New Tazewell, was arrested in May of this year on charges of obtaining a prescription for Methadone with the intent of selling a portion of the prescription. Howell pleaded guilty to one count of TennCare fraud, and one count of Sale of Schedule II controlled substance. She was sentenced to four years and six months of Community Corrections supervised probation, and 17 days of incarceration. She was ordered to forfeit $3,250 to the 8th District Drug Task Force and pay a $250 fine. The court also ordered that she not be permitted to re-enroll in TennCare.

"There is a serious problem with prescription drug fraud in Tennessee," Inspector General Deborah Faulkner said. "But we are sending a clear message that anyone who tries to use TennCare to fund prescription drug crimes could face jail time, losing TennCare benefits and paying fines and penalties.”

District Attorney General Mike Bottoms prosecuted the Lawrence County Case. The Overton County case was prosecuted by District Attorney General Randall York. District Attorney General William Paul Phillips prosecuted the New Tazewell Case.

The OIG, a law enforcement agency separate from TennCare, began full operation in February 2005 and has worked cases leading to the arrest of over 810 individuals for TennCare fraud, with nearly $1 million paid in restitution to TennCare, and total estimated cost avoidance in TennCare of over $122 million, according to latest figures.

Through the OIG Cash for Tips Program established by the Legislature, Tennesseans can get cash rewards for TennCare fraud tips that lead to convictions. "Anyone can report suspected TennCare fraud by calling 1-800-433-3982 toll-free from anywhere in Tennessee, or log on to www.tncarefraud.tennessee.gov and follow the prompts that read "Report TennCare Fraud."