A former laboratory worker at a Hazard clinic has pleaded guilty to lying to cover up falsifying patients' drug tests.
Amanda Lynn Dunn worked at Ace Clinique of Medicine, operated by Dr. James Alvin "Ace" Chaney and his wife, Lesa L. Chaney, according to court records.
Chaney, his wife and the clinic are charged with conspiring to dispense pills illegally from March 2006 to October, when state regulators suspended Ace Chaney's license after he was charged.
The indictment includes a total of more than 250 drug, money-laundering and health care fraud charges.
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The allegations include that Chaney left signed prescriptions for others to fill in for patients when he wasn't there and that he took part in improper billing to Medicaid and Medicare. Many of the fraud charges name Lesa Chaney as well.
Ace Chaney also is charged with directing employees to falsify the results of urine drug screens on patients to hide the fact that they weren't using their medication as prescribed or to mask that they were taking drugs illegally.
Dunn said in her plea agreement that she falsified drug-test results on patients under Chaney's orders.
However, when Dunn testified to a federal grand jury in January, she denied ever fraudulently altering a test result, she said in her plea.
Dunn's plea said she agreed to help Chaney and his wife "in their scheme to defraud" because she feared losing her job if she told the truth.
The clinic closed the next month, according to a recording at the office.
Dunn pleaded guilty Monday. She faces up to five years in prison when she is sentenced in November.
Pleas such as the one Dunn entered often require cooperation with prosecutors.
Dunn is the second former employee of Ace Clinique of Medicine to plead guilty.
Gregory Hoskins, a physician assistant, said he and others finished filling out prescriptions for patients that Chaney had signed and left.
Hoskins said in his plea it was clear much of the clinic's patient population was not seeking real treatment "but rather was addicted to controlled substances or was otherwise diverting the controlled substances" for illegal purposes.
Hoskins has not been sentenced.
Chaney's attorney, Elizabeth Hughes, declined comment Tuesday on Dunn's plea.
However, Chaney and his wife have strongly denied the charges. Their attorneys said in one court motion that allegations the clinic was a pill mill were based on rumor and speculation.
Chaney's clinic was well known. The FBI seized more than 7,200 patient files during a search in 2013, according to a court document.
The most serious charges against Chaney and his wife carry sentences of up to 20 years.
The indictment includes a forfeiture count under which the government seeks to take away the clinic, the couple's house, luxury vehicles and an airplane.
It also seeks a judgment of $23.3 million, the gross proceeds of alleged illegal activities.