A scandal rattling the Alabama State House grew last week whenÂ a third state legislator was accused in an alleged conspiracy concerning three now closed diabetes treatment clinics.
Prosecutors outlined how they say the scheme unfolded in a second indictment issued by a federal grand jury last week.
The timeline below is the prosecutors’ version of events. No one has been convicted and several have denied wrongdoing. One of the accused participants, former Rep. Micky Hammon,Â served a three-month prison sentence in a separate federal case and is not charged in this case.
A few of the alleged actions described below are out of chronological order for clarity or because that’s the way they were listed in the 57-page indictment.
December 2009, the Centers for Medicare and Medicaid Services determines that Medicare won’t cover outpatient intravenous insulin infusion therapy (OIVIT) because of a lack of evidence that it helps patients. Private insurance plans generally follow the Medicare determinations.
August 2014, a clinic opens in Foley to provide “artificial pancreas treatment,” which the indictment say is a form of OIVIT. The clinic is affiliated with Trina Health, a California company founded by G. Ford Gilbert, who is one of those charged. Patients spend three hours receiving insulin infusions. Trina Health says the therapy can treat diabetes, neuropathy, hypoglycemia, hypertension, chronic fatigue, wounds and erectile dysfunction. A Texas company called CP Homes enters a license agreement with Trina Health to open the Foley clinic.
February 2015, CP Homes opens a second Trina Health-affiliated clinic in Fairhope.
May 2014, Rep. Micky Hammon, R-Decatur, majority leader in the Alabama House of Representatives, is asked to help recruit investors for Trina Health-affiliated clinics in Alabama. The request comes from “C.B.” a Georgia resident and “longtime acquaintance” of Trina Health CEO Gilbert. Hammon tells Rep. Randy Davis, R-Daphne, about the opportunity. C.B. tells Hammon and Davis he will give a 5 percent ownership interest to any person who recruits an investor.
February 2015, Hammon, Davis and C.B. tour the Fairhope clinic and meet Gilbert, who shows them how artificial pancreas treatment works and assures them that a clinic in north Alabama would perform a public service and be profitable.
March to May 2015, Blue Cross Blue Shield of Alabama determines that the Trina Health-affiliated clinic in Foley improperly coded claims for OIVIT, resulting in Blue Cross Blue Shield wrongly making payments on the “artificial pancreas treatment.” Blue Cross Blue Shield notifies the clinic of its findings and requests refunds. A few months later, Blue Cross and Blue Shield would request refunds from the Fairhope clinic.
May 2015, Hammon recruits four investors for a Trina Health-affiliated clinic in the Birmingham area. The investors wire $390,000 into the bank account of a company established by C.B. for the clinic. C.B.’s company pays Hammon $12,500 and offers to give Hammon 5 percent ownership of the clinic. Hammon accepts a 4 percent stake instead. The state ethics law would have required him to disclose ownership of 5 percent or more.
May to September 2015, Hammon finds a location for the Birmingham-area clinic in Hoover, oversees renovations and helps hire a doctor to be the “medical director.” C.B.’s company pays Hammon another $16,000.
June 2015, Davis sends an email to Hammon saying he met with Gov. Robert Bentley and two potential investors in the clinics.
June to August 2015, Gilbert appeals Blue Cross Blue Shield’s requests for refunds on the clinics’ claims. Gilbert argues, in part, that his company’s “artificial pancreas treatment” is not a form of OIVIT. Blue Cross Blue Shield says the treatment does not meet its medical criteria for coverage and is “investigational.” The first-level appeal is denied.
August to September 2015, Gilbert tells Hammon, C.B., and the Hoover clinic investors about Blue Cross Blue Shield’s position. Gilbert says he is confident that Blue Cross Blue Shield will reconsider.
September 2015, Hammon sells half of his interest in the Hoover clinic to an investor from Albertville and receives $35,320.
September 15, 2015, Gov. Robert Bentley attends a grand opening for the Trina Health-affiliated clinic in Hoover.
October 2015, CP Homes, the company that opened the Trina-Health affiliated clinics in Fairhope and Foley, issues a press release saying, “Blue Cross Blue Shield of Alabama denies life-changing coverage to diabetics.”
October 2015, Hammon contacts “State Senator A,” identified in the indictment as representing Jefferson and Shelby counties and being perceived by other lawmakers as influential to Blue Cross Blue Shield of Alabama. At Hammon’s request, “State Senator A” contacts “Lobbyist A,” identified as the vice president of governmental affairs for Blue Cross Blue Shield, about Trina Health.
October 2015, Trina Health CEO Gilbert unveils a public relations plan against Blue Cross Blue Shield that he calls “BlueGate.” It includes advocating for a state law to require insurers to cover “artificial pancreas treatment.” To avoid public scrutiny, Gilbert agrees to begin referring to Hammon as “Bill Johnson” in written communications.
November 2015, Hammon persuades “State Representative A” to visit the Trina Health-affiliated clinic in Fairhope for a consultation. The indictment identifies “State Representative A” as a Baldwin County lawmaker with diabetes. State Representative A accepts a publicly available offer of four free treatments in exchange for signing a petition asking Blue Cross Blue Shield to start covering the treatment.
(Rep. Joe Faust, R-Fairhope, who is State Representative A, says he paid for his treatments, a co-pay on the first two and a full payment on others. Faust said the treatments helped him and said that’s what he told a legislative committee. Faust is not accused of wrongdoing.)
November 2015, Davis asks “State Representative C” to contact Blue Cross Blue Shield about reversing its position. State Representative C asks whether Davis’ purpose is to help Hammon. Davis says he is only trying to help diabetic patients in his district.
January 2016, the clinics in Fairhope and Foley pay the refunds requested by Blue Cross Blue Shield, a total of about $42,000.
February 2016, Trina Health CEO Gilbert receives formal notification from Blue Cross Blue Shield that it denied his appeal of its decision that it would not cover the treatments. Gilbert drafts a letter in response, and at Hammon’s suggestion, writes that the Blue Cross Blue Shield decision contradicts the company’s slogan, “We cover what matters.”
February 2016, Hammon informs Gilbert that he is not able to pay a debt of $242,000 to Regions Bank. Gilbert contacts Regions and indicates that Trina Health would pay Hammon’s debt when the clinics become profitable. Regions grants Hammon an extension.
February 2016, Trina Health CEO Gilbert asks Hammon to sponsor a bill requiring insurance coverage of artificial pancreas treatment. Hammon refuses.
February 2016, CP Homes, owner of the Trina Health-affiliated clinics in Fairhope and Foley, hires lobbyist Marty Connors to lobby for a bill.
February 2016, Davis meets with Rep. Jack Williams, R-Vestavia Hills, and asks him to support a bill to require insurance companies to cover “artificial pancreas treatment.” Williams understands that it would benefit a company connected to Hammon and agrees to support such a bill.
February 2016, Trina Health CEO Gilbert, and C.B., head of the company that owned the Hoover clinic, meet Williams for dinner at a Birmingham restaurant. Williams tells Gilbert he will get the bill assigned to the House Commerce and Small Business Committee, which Williams chairs, and would hold a public hearing on the bill.
March 2016, Lobbyist Connors notifies Trina Health CEO Gilbert about House Bill 86, which concerned insurance coverage of cancer drugs. Connors suggests the bill could be amended to include the artificial pancreas treatment.
March 2016, Trina Health CEO Gilbert sends lobbyist Connors a proposed addition to House Bill 86. Connors forwards it to Davis and Williams. Davis asks the sponsor of House Bill 86, Rep. Ron Johnson, R-Sylacauga, whether he would be willing to add it to his bill. Johnson says proponents of House Bill 86 would not support that. Johnson offers to sponsor a stand-alone bill backed by Trina Health. (Johnson is not charged or named in the indictment but is identified as State Representative B.)
March 2016, Trina Health CEO Gilbert sends lobbyist Connors a proposed bill to require insurers to cover artificial pancreas treatment. Connors sends it to the Legislative Reference Service, the agency that drafts bills, and requests that it draft the bill on behalf of Williams and Johnson. Johnson later introduces it as House Bill 415. At Williams’ request, it is assigned to the Commerce and Small Business Committee.
April 2016, lobbyists opposed to House Bill 415 request a public hearing. Williams presides over the public hearing on April 13. Trina Health CEO Gilbert, Rep. Davis and Faust testify in support of the bill. A Blue Cross Blue Shield physician testifies against it.
April 19, 2016, the Commerce and Small Business Committee is scheduled to vote on House Bill 415. But shortly before the meeting, Williams pulls it from the agenda. The bill dies.
February 2017,Â Hammon resigns from his position as majority leader in the House of Representatives, a position he had held since 2010.
July 2017, Hammon announces he will not seek reelection.
September 2017,Â Hammon pleads guilty to one count of mail fraud in federal court. Prosecutors said he converted campaign funds for personal use. Prosecutors said they uncovered the crime during an unrelated investigation. The conviction removes Hammon from office.
February 2018, Hammon isÂ sentenced to three months in prison and ordered to pay $50,657 restitution for the mail fraud conviction.
April 2018, Rep. Jack Williams, R-Vestavia Hills; lobbyist and former state Republican Party chairman Marty Connors; Trina Health CEO G. Ford GilbertÂ are indicted by a federal grand jury in an alleged bribery conspiracy. They plead not guilty.
July 2018,Â a federal grand jury indicts Connors, Gilbert and Rep. Randy Davis in a superseding indictment in the alleged Trina Health bribery scheme. Arraignment is scheduled for August 8.