A Pulaski County man charged in 2021 for his part in a scheme that bilked the U.S. government's military health insurer out of over $12 million was sentenced to five years' probation Friday by a federal judge, ordered to pay a $12,500 fine and perform 500 hours community service over the next five years.
Blake Yoder, 41, of Scott, pleaded guilty in February before U.S. District Judge Lee Rudofsky to one count of violating the U.S. Anti Kickback Statute. Yoder is one of a number of defendants in Arkansas responsible for defrauding TRICARE, the nation's military insurer, out of more than $12 million in Arkansas from a scheme to generate fraudulent prescriptions for expensive compounded drugs paid for by TRICARE in 2015 and 2016.
Under the scheme, Yoder and other pharmaceutical reps, under the direction of Albert Glenn Hudson, 41, of Sherwood -- described as the "quarterback" of the team of pharmaceutical sales representatives, physicians and patients -- recruited TRICARE beneficiaries to agree to receive expensive compounded drugs they didn't need. Those prescriptions were written by two healthcare providers who never saw the patients, then filled by an out-of-state compounding pharmacy.
According to Yoder's plea agreement, sometime around January 2015 Hudson offered to pay Yoder to recruit TRICARE beneficiaries to get compounded drugs from a Mississippi compounding pharmacy, telling Yoder that the drugs would not cost beneficiaries anything and that Hudson would secure their prescriptions.
In all, the document said that Hudson paid Yoder $62,633.16 for recruiting six TRICARE beneficiaries, including himself, who received over $300,000 in compounded drugs.
Hudson was recently sentenced to four years in prison for his part in the scheme. Derrick Clifton, another leader in the scheme, was sentenced to 51 months in prison last year. Seven other defendants -- including Alexander doctor Joe David May, who was found guilty by a jury of multiple counts of wire fraud and other crimes related to the scheme -- are awaiting sentencing.
Rudofsky agreed to the term of probation in lieu of prison after arguments by Yoder's attorney, Erin Cassinelli, to which Assistant U.S. Attorney Alex Morgan did not object. Under federal statutes, Yoder could have been sentenced to a maximum five-year prison term.
Cassinelli argued that Yoder's life had been severely affected by the crime and that he had paid back his more than $62,000 in profits from the scheme with a cashier's check that was turned over to the U.S. Marshals Service in March 2021 after Chief U.S. District Judge D. Price Marshall Jr. ordered the check forfeited to the government at the conclusion of a civil forfeiture lawsuit.
"Mr. Yoder has had this hanging over his head for six years," Cassinelli said. "That's a long time for this to being going on. He immediately repaid that money ... Frankly, it took Mr. Morgan and I and some other lawyers a minute to figure out how to get that money forfeited ... He was willing to repay it and he repaid it promptly."
Cassinelli said that Yoder, a 20-year veteran of the Air Force, had to retire from the military as a result of his involvement and he is also prohibited from working in the medical sales industry again. She said Yoder's income has dropped by roughly two-thirds and he has had to dip into his savings to make ends meet.
"I know the court is required to consider a fine in this case," Cassinelli said. "It does appear on paper that he has quite a bit of assets but I want to point out that the liquidity of those assets is what's at issue here."
Under federal statutes, Yoder could have faced a maximum fine of $250,000. Cassinelli said a large fine would negatively impact Yoder's ability to care for his children -- of whom he has joint custody -- and could also trigger tax penalties to his retirement savings if he were to be forced to draw from that source of funds.
"The court can see that some of his assets have been depleted," Cassinelli said. "That's because he's been using them to take care of his children and pay his monthly expenses."
"The lingering concern I have is general deterrence," Rudofsky said. "People need to know that if you commit a crime like this there are going to be serious consequences and one of those serious consequences is that you're going to wind up in a far worse situation than when you started."
Simply paying back the money profited from such a fraud, the judge said, would not be sufficient.
"That's sort of the baseline," he said. "My thought is that somewhere between 10 and 60% of what he gained illicitly is ... what he should pay as an extra fine."
Given a chance to speak, Yoder, fighting back tears, apologized.
"I'm ashamed of veering off course of my moral compass," he said. "This is not who I am and it's not the image I want to portray ... I had no idea the lifetime of consequences my poor decision would create."
Although Morgan did not oppose probation, he said the hardships Yoder has endured since his arrest were the result of his own conduct.
"None of those collateral consequences are unique and ... under [the sentencing factors] they don't merit consideration," Morgan said. "That's a result of the offense."
However, Morgan said, when Yoder was confronted with the offense in 2016, he immediately took responsibility for his actions, repaid the government and cooperated with prosecutors.
"I think probation, a fine and community service checks all of the boxes," he said.
On the matter of the fine, Rudofsky finally settled on $12,500, which is approximately 20% of the amount of money Yoder made off of the scheme. Morgan concurred.
"I think 20% has a certain poetic justice quality because that was the commission he was earning in this particular case," Morgan said.
"To be fair, I did not make that connection," Rudofsky said.
"That's all right," Morgan replied. "I just look for the signs everywhere I can see them."
Rudofsky warned Yoder that even though he was avoiding prison, any infraction would likely put him behind bars. He said Yoder's distinguished military service was a big factor in his decision.
"If not for that I don't think this is where I would have ended up," Rudofsky said. "Please don't make a fool of me ... this is really a last chance. If you do something wrong, whether it's a substantive violation or a technical violation of your probation, you are looking at real prison time."