U.S. military members duped to help pull off insurance fraud

CBS News is exposing an insurance scam — and you, as a taxpayer, are a victim.

It is especially egregious because members of the U.S. military are being duped to help pull off the fraud.

A club in West Hollywood, with pulsing music, might not seem like the ideal location for a business meeting. But this was where we were invited by Dustin Warren, a salesman working with a lab that conducts genetic testing and drug screening.

CBS News recorded the meeting undercover.

Warren gave us a taste of his hardball pitch he uses to get doctors to order the tests.

“If you’re not doing this, you’re a pile of s**t. You don’t care about people. You don’t care about cancer. And you don’t care about your patients. Bottom line,” he said.

CBS News

With the right contacts, Warren told us, we could expect to make big money.

“Sixty f***** grand a month,” he said.

Thanks, in part, to genetic tests that assess cancer risk. He said military insurance, called Tricare, reimburses the most for a single test.

“We were banging them for 12 to 16 grand and we dialed it back to 8,000 because we’re like, we’re going to get f***… this isn’t going to be good for anybody,” Warren said.

The tests are conducted and billed by a lab in Dallas, Cockerell Dermatopathology, which offers another test — a drug screening. And that screening made the lab more than $5 million dollars from Tricare last year.

Screening test made Cockerell Dermatopathology more than $5 million dollars from Tricare last year.

CBS News

To entice soldiers to be screened — so Tricare could be billed — others working with the Cockerell Lab set up a makeshift clinic in a strip mall just a mile from the gates of Fort Hood.

CBS News has learned that beginning last summer and running all the way through this past February, soldiers would line up every day in this parking by the…

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