'Obamacare' fraud ring netted nearly $2 million, authorities allege

Prosecutors have accused a former Florence man of being the ringleader of an elaborate health-care fraud that netted him and eight others nearly $2 million in bogus health-insurance claims.

Nicholas Scaffidi, 35, was charged earlier this month with fraud, money laundering and multiple counts of theft in connection with a scheme that prosecutors say began September 2014 during the first year of the Affordable Care Act marketplace.

Investigators identified Scaffidi as the leader of a group that included his wife and seven accomplices, who they allege routinely visited out-of-network hospital emergency rooms with vague complaints of illnesses and demanded that doctors order a series of expensive tests.

The suspects targeted hospitals that did not have contracts with their insurance provider, Blue Cross Blue Shield of Arizona. Though an insurer typically sends payments directly to health providers that are part of its network, Blue Cross sends payment checks to the consumer's address if they use out-of-network hospitals and doctors.

The Arizona Attorney General's Office and Arizona Department of Insurance agents said in a charging document that Scaffidi signed up for health-insurance plans for himself and others on the federal marketplace. According to a search-warrant affidavit filed at Maricopa County Superior Court, Scaffidi listed Arizona addresses on the insurance applications, even though his accomplices lived in other states, and Scaffidi and his wife moved from Florence to Fort Pierce, Florida, in February 2016.

Court documents state that the suspects would visit hospital emergency rooms complaining of symptoms such as fainting, abdominal pain and chest pain, prompting doctors to order multiple diagnostic tests. During one visit, Scaffidi refused to leave the hospital until staff performed certain diagnostic tests, court documents state.

Scaffidi personally collected more than $182,000 for 17 emergency-room visits at six hospitals in four states, court documents state.

Others claimed health ailments from falling down stairs or falling in a restroom and hitting their heads on a toilet even though they did not have cuts, bumps or bruises, court documents state. The suspects would often travel together and make multiple visits to hospitals within a short period of time, court documents state.

On hospital paperwork, the suspects listed Scaffidi's phone number and often included addresses of rented mailboxes paid by Scaffidi, the search warrant states.

Department of Insurance agents traced 20 bank accounts tied to the suspects and seized more than $97,000.

In addition to arresting Scaffidi and his wife, Jolene Scaffidi, in Florida, law-enforcement and insurance-fraud investigators in Arizona, Florida and New Mexico arrested Darrell Johnson, Melissa Tavasci, Roy Brite, Seralda Johnson and Jeffrey Catren. Two other suspects, Matthew Fisher and Melissa Carolyn Dotson, also face fraud and theft charges.

Scaffidi also registered a business in Arizona, Fast AZ Cars LLC, which listed an address in Florence.

Scaffidi’s Facebook page indicated that he owns a “small classic car dealer in Arizona” and includes posts showing a 1995 Dodge Viper.