Two Winston-Salem men were sentenced Monday to federal prison for committing more than $1 million in health care fraud through a company they started in Jacksonville, Fla.

Shawn Thorpe, 31, and Ruben McLain, 47, had pleaded guilty in October in U.S. District Court in the Middle District of Florida to conspiracy to commit health care fraud. Each man had faced a maximum prison sentence of five years and a fine of up to $250,000, according to a news release from the U.S. Attorney’s Office in the Middle District of Florida.

U.S. District Judge Brian Davis sentenced Thorpe to two years in prison. Davis sentenced McLain to four years and nine months in prison. Thorpe was ordered to pay $211,311, and McLain has to pay $1.16 million, according to the news release. The total restitution is $1.37 million.

Chris Beechler, Thorpe’s attorney, said Thorpe did not have a prior felony criminal record and Davis acknowledged that Thorpe was young and inexperienced at the time.

McLain was convicted on health-care fraud in 2011 and was declared an “excluded provider” in 2012, meaning that he was not allowed to bill federal health care programs, such as Medicaid, for any services, federal prosecutors said in court papers.

But he did, using Julian Winchester as an alias, according to court documents.

Thorpe and McLain started Coastal Bay, a company that provided mental health services to Medicaid patients. Thorpe never told anyone in the Medicaid program that he was working with someone who had been excluded from participating. As Julian Winchester, McLain hired and fired people and performed other management duties. He also traveled from his home in Winston-Salem to Jacksonville, Fla., to help with Coastal Bay operations.

Federal prosecutors said McLain used Coastal Bay’s corporate credit card to make rountine purchases at restaurants, furniture stores, gas stations and other places in North Carolina, even though Coastal Bay had no operations in the state. McLain and his family received more than $10,000 in direct payment withdrawals from Coastal Bay business accounts.

Coastal Bay received $1.2 million in reimbursements from Medicaid because of McLain’s alleged fraud. Coastal Bay got $211,311 in reimbursements from Medicaid because of Thorpe’s alleged fraud.

“Shawn Thorpe was a young, uneducated, inexperienced and naive businessman,” Beechler said. “He was attempting to grow what he believed to be a legitimate agency.”

Beechler said it was his personal opinion that Thorpe was less culpable than McLain.

David Freedman, McLain’s attorney, said his client cooperated with the investigation and was supported by his wife and four children.

“He apologized to the court for his actions,” he said.

Freedman said both men will have to report to federal prison on May 29 to start serving their sentences.

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mhewlett@wsjournal.com 336-727-7326 @mhewlettWSJ

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