A Hazard physician has been convicted of more than 150 charges, including illegal distribution of drugs and health care fraud, according to U.S. Attorney Kerry Harvey’s office.
The most serious charges against Dr. James “Ace” Chaney, who operated Ace Clinique of Medicine, carry a maximum sentence of 20 years in prison.
A federal jury convicted Chaney, 51; his wife Lesa Chaney, 50; and their business on Monday after a seven-week trial.
The Chaneys are scheduled to be sentenced in August.
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However, Ace Chaney’s attorney, Elizabeth S. Hughes, said Tuesday the couple will appeal their convictions.
Ace and Lesa Chaney and their clinic were charged with conspiring to dispense pills illegally from March 2006 to October 2014, when state regulators suspended his license.
Ace Chaney allegedly left signed prescriptions for others to fill in for patients when he wasn't there and improperly billed federally-funded health programs.
Evidence at the trial showed Chaney knowingly provided drug prescriptions to drug abusers and people who sold the pills, Harvey’s office said.
The trial also showed Chaney had employees falsify the results of urine drug screens on patients and then submitted the results for payment from Medicare, Medicaid and private insurers, Harvey said.
Chaney and his wife billed Medicare and Medicaid a total of nearly $16 million during the conspiracy, using some of the money for an airplane, houses, vehicles and travel, Harvey said.
“The defendants in this case combined a massive illegal drug distribution scheme with a massive health care fraud scheme,” Harvey said in a statement issued Tuesday. “The resulting criminal enterprise harmed countless Kentuckians, and sent the fraudulent bill to the American taxpayer.”
The Chaneys strongly denied the charges. Defense attorneys said Chaney treated all his patients based on what he believed to be proper medical practice, and that he and his wife did not knowingly make fraudulent representations.
The jury acquitted Chaney and his wife on some charges, including more than 30 counts related to alleged fraudulent billing for MRI examinations.
However, Harvey said the jury convicted Ace Chaney of conspiracy to commit drug trafficking, money laundering and health fraud; maintaining a place of drug distribution; 62 counts of illegal drug distribution; 20 counts of money laundering; and 84 counts of health care fraud.
Lesa Chaney, the president of the clinic, was convicted on many of the same charges, but not on illegal drug distribution, according to Harvey’s news release.
The clinic was convicted on more than 180 charges, the news release said.
Chaney’s clinic was well known and busy. Authorities seized more than 7,200 patient files during a search in 2013, according to a court document.