Amtrak Health Plan Defrauded of $12 Million by Over 100 Employees and Medical Providers

A sweeping internal investigation by the Amtrak Office of the Inspector General has uncovered a $12 million health care fraud scheme involving at least 119 current and former employees and several New York-based medical providers. Described as the largest employee conspiracy ever investigated by the agency, the report highlights a systemic ethical breakdown, particularly within Amtrak’s Northeast corridor workforce.

According to the report, employees received cash kickbacks in return for allowing their health insurance information to be used in fraudulent claims for services that were never rendered. The scheme led to the health plan being billed over $16 million, with more than $12 million paid out. Two central figures in the scheme — Devon Burt of Pennsylvania and Hallum Gelzer of New Jersey — have already pleaded guilty to conspiracy charges and agreed to repay a combined total exceeding $2.6 million.

So far, twelve individuals have been criminally charged, and at least eight have pleaded guilty. The fallout includes over 50 employees who have either resigned or retired, with potential disciplinary action pending for 61 active employees. The report originated from a routine investigation into irregular billing patterns between a few health care providers and a notably high volume of Amtrak-insured patients.

Amtrak responded by emphasizing recent efforts to curb insurance fraud and urged insurers to take stronger preventative measures. The case underscores the ongoing challenges corporations face in monitoring and securing employee benefits programs from internal abuse.