The owner of a now-defunct for-profit addiction treatment company pleaded guilty Friday to federal charges, following a week where his five co-defendants also admitted to charges in a scheme prosecutors said led to $48 million in fraudulent billing of Medicaid.
Ryan Sheridan, 39, of Leetonia admitted that he and others worked together to defraud the federal government through Braking Point Recovery Center, which provided detox, outpatient treatment, day treatment and sober-living services.
His arrest in February came in the wake of federal and state investigations into problems with the company and how it received money and doled out prescriptions to patients.
Braking Point had facilities in Austintown and Whitehall, near Columbus. The Ohio Department of Medicaid stopped paying claims from the company in October 2017, around the time the FBI executed its first set of search warrants. Sheridan, a flashy businessman and developer, made a name for himself in the Mahoning Valley, was the company’s sole owner.
During a hearing in front of U.S. District Judge Benita Pearson in Youngstown, he admitted Friday to conspiracy, health-care fraud, operating a drug premises, money laundering and other charges. He faces up to 10 years in federal prison and is in the custody of the U.S. Marshals Service.
Others who pleaded in the past week Ryan Sheridan’s ex-wife Jennifer Sheridan, 41, of Austintown; Kortney Gherardi, 30, of Girard; Lisa Pertee, 51, of Sunbury; Dr. Thomas Bailey, 45, of Poland, and Dr. Arthur Smith, 55, of Austintown. All the defendants but Sheridan reached plea agreements with the federal government.
All the defendants are scheduled to appear at a sentencing hearing in January.
Prosecutors said Braking Point sent Medicaid 134,744 reimbursement claims between May 2015 and October 2017, often for services that were more expensive than ones Braking Point staff provided. The claims were for more than $48.5 million in services it claimed to provide, and Medicaid paid out more than $31 million as a result.
Officials said the Sheridans, Gherardi, Bailey and Smith also developed a standard of giving the same amount of Suboxone, a drug used to wean addicts off of more heroin and other powerful opioids, to all clients as soon as they entered Braking Point’s detox program. This happened without a doctor evaluating whether it was necessary to use the drug, officials said.
Ryan Sheridan used money he made from his health-care fraud schemes to make numerous purchases, according to federal prosecutors.
He was known for his collection of automobiles, which included replicas of cars featured in popular movies such as “Batman,” “Back to the Future” and “Ghostbusters.” Authorities seized them last year.
“These defendants … used the drug epidemic plaguing Ohio as a way to line their pockets and profited off the suffering of others,” U.S. Attorney Justin Herdman said.