TYLER, Texas — A former Texas hospital CEO has been sentenced to 36 months in federal prison for conspiring to violate the Anti-Kickback Statute, according to U.S. Attorney Damien M. Diggs. Jeffrey Paul Madison, 49, of Burnet, Texas, was found guilty alongside four others following a seven-week trial.
Madison, sentenced by U.S. District Judge Jeremy D. Kernodle on January 15, 2025, also agreed to pay $5,343,630 to resolve allegations under the False Claims Act involving illegal payments to physicians for laboratory referrals. Co-defendants Susan L. Hertzberg, 66, of New York, New York; Matthew John Theiler, 58, of Pinehurst, North Carolina; David Weldon Kraus, 66, of Maryville, Tennessee; and Thomas Gray Hardaway, 52, of San Antonio, Texas, were also found guilty on November 30, 2023.
Theiler received an 18-month sentence and a $75,000 fine on November 20, 2024, while Kraus was sentenced to 22 months and fined $25,000 on December 5, 2024. The group was indicted on January 12, 2022, for conspiring to commit illegal remunerations in violation of the Anti-Kickback Statute, which prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by federal health care programs…