SHERMAN — A federal trial began Wednesday for a Dallas-area doctor accused in an alleged scheme to collect millions of dollars from insurance companies for medical services provided to injured university student athletes.
The prosecution and defense told jurors in opening arguments that third-party billing company Vivature used Dr. Kyle Carter’s provider identification number to bill insurance companies for services provided to student-athletes who Carter never treated. However, the legal teams differ in their explanations of whether Carter, of Precision Family Medicine in Carrollton, knew Vivature was improperly using his credentials for billing and intended to conspire to commit wire fraud.
Carter was indicted in October. In January, another doctor and two businessmen were also indicted in the alleged scheme: Mouzon “Muzzy” Bass III of Highland Park; Lance West Wilson of Allen; and Dr. Robert Brent Scott of La Quinta, California. The other three were also indicted in a separate alleged conspiracy to fraudulently obtain government funds for Covid-19 testing. Between the two alleged schemes, the defendants received more than $70 million, contends the U.S. Attorney’s Office for the Eastern District of Texas.
While Carter’s work with Addison-based Vivature lasted less than four years and his earnings amounted to less than $85,000, the alleged scheme as a whole lasted about 10 years, prosecutors said in a January announcement of the indictments.
Jurors in Carter’s trial were selected Wednesday and opening statements were heard before U.S. District Judge Amos L. Mazzant III.
Assistant U.S. Attorney Anand Varadarajan told jurors that insurance representatives would testify that companies pay higher rates and more frequently when they see a doctor’s name on a claim — and that insurers might not pay at all without a doctor’s name.
“The scheme amounted to free money,” Varadarajan said.
Varadarajan said Carter was paid more than $75,000 over nearly four years. Arianna Goodman, one of Carter’s lawyers from Vedder Price, said his earnings were about $84,000 and that he paid Vivature some of that money for one of its employees’ services.
Varadarajan anticipated the defense would claim Carter didn’t know his name and credentials were being used in Vivature’s billings. The prosecutor urged jurors to consider the actions Carter did not take. For example, Carter did not reach out to the Department of Insurance or law enforcement, Varadarajan said.
The “inaction from an experienced” doctor is “just as powerful,” Varadarajan said. “The defendant agreed with others to lie and steal money,” he added. “It’s as simple as that.”
Carter did not see and treat student-athletes, Goodman said, because he was not a service provider. Rather, he was a supervising physician whose responsibilities included reviewing student athletes’ charts and consulting with athletic trainers if called upon, she said.
“Did Dr. Carter go to these universities? No,’” Goodman said. “Was he required to? Absolutely not.”
Goodman said Carter would not have signed a contract requiring him to travel the state. He understood his role as Vivature’s medical director to be supervisory.
Carter, who lives in Keller with his wife, has a “soft spot” for small schools and their sports programs, Goodman said. Carter graduated from Abilene Christian University before attending the University of Texas Southwestern Medical School. Carter completed his residency at the University of Alabama, where he gained experience in sports medicine, Goodman said.
In 2014, another doctor who knew Carter had an interest in sports medicine introduced him to Vivature and Carter became a medical director for the company, Goodman said. Carter was given the impression Vivature worked with universities that didn’t have a physician onsite to seek reimbursements compliantly, Goodman said.
When Carter received a call from an insurance company that gave him the impression Vivature was billing with his unique identification number, Carter reached out to the billing company, Goodman said. His staff said they spoke with Vivature, which relayed that nothing should have been billed under his credentials and that Vivature would sort the issue out, Goodman said.
Carter quit working with Vivature in 2018 and, in a resignation letter, said he did not have time to adequately monitor the work being performed, Goodman said.
Carter did not have insight into Vivature’s billing, Goodman said. “And without knowledge, you can’t get to intent,” Goodman told jurors.
The evidence is “consistent with a supervising physician and an innocent man,” Goodman said.
Carter is also represented by Jeff Ansley and Sam Deau of Vedder Price.
The government is also represented by Adrian Garcia, Glenn Jackson and Tom Gibson of the U.S. Attorney’s Office.
The case number is 4:23-CR-225.
Bass is represented by Scott Thomas, Alexander Nowakowski and Tom Melsheimer of Winston & Strawn.
Wilson is represented by Arnold Spencer of Spencer & Associates in Fort Worth.
Scott is represented by Gene Besen, Scarlett Nokes and Stephen K. Moulton of Bradley Arant Boult Cummings.
That case number is 4:24-cr-00007.