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Former Nebraska Medicaid administrator pleads guilty to bilking 85-year-old father

January 9, 2019

A former state Medicaid audit administrator now admits he bilked the program of $84,000 — and his 85-year-old father of nearly $300,000 — while he was in the job.

Craig A. Barnett, 5310 Sawgrass Drive, waived indictment and pleaded guilty to two counts of wire fraud and two counts of mail fraud for the scheme last week in U.S. District Court in Omaha as part of a plea agreement.

At the time of the fraud, he was working at the Nebraska Department of Health and Human Services as the administrator of the Medicaid Audit and Financial Support division.

In court records, Assistant U.S. Attorney Frederick Franklin said that after Barnett’s mother died in 2010, his father granted him power of attorney over his affairs, sold his home and moved to a nursing home in Elkhorn on Dec. 26, 2014.

By Nov. 15, 2016, his father’s account at the nursing home was $118,000 in arrears and, later that month, he was approved for Nebraska Medicaid.

In the meantime, Franklin said, Barnett used the power of attorney, which he held until Aug. 5, 2016, to take his father’s pension, retiree grant payments and payments from mutual funds, while spending only a portion of it on his father’s expenses.

“The remainder was used by Craig for his personal benefit,” Franklin wrote in an information filed Jan. 3.

The amount of loss and restitution is in dispute, according to a written plea agreement.

But in the information, Franklin alleged as a result of Barnett’s scheme, Dean Barnett suffered a loss of $294,396, and Nebraska Medicaid a loss of $84,110.

Specifically, he said the payments included $75,000 in monthly checks from the Broadcasters Foundation of America approved for his father, a news industry retiree, based on financial need; $45,000 from his mutual funds account; $13,872 from his pension and $113,858 in Social Security Administration checks.

Craig Barnett’s attorney, Sean Conway, didn’t immediately return a request for comment.

Barnett left his administrator job at DHHS, where he’d worked for more than 11 years, on Sept. 30, 2016, according to HHS spokeswoman Julie Naughton. Because it was a personnel matter, she said she was unable to comment further.

After leaving, Barnett went to work as a financial associate at the Nebraska Innovation Campus Business Center, according to its website.

When asked if Barnett’s position at the time of the crime made it more egregious, a spokeswoman with the Nebraska Attorney General’s Office, which investigates Medicaid fraud, said the office “does not comment on such matters, including whether someone may be under investigation.”

Barnett is set for sentencing in April.

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