Minnesota Psychologist Charles Jorenby Sentenced to Prison; Defrauded Tribal Health Fund of $819K

October 26, 2023

ST. PAUL, Minn. – A Chanhassen psychologist has been sentenced to 24 months in prison followed by three years of supervised release for fraudulently billing for counseling services never actually rendered, announced U.S. Attorney Andrew M. Luger.

According to court documents, Charles Howard Jorenby, 57, was a licensed psychologist and owner of Life Dynamics, Inc., a counseling center located in Prior Lake. From at least January 2013 through February 2020, Jorenby orchestrated a scheme to defraud the Shakopee Mdewakanton Sioux Community (SMSC), which is responsible for funding its own tribal members’ health care costs. In order to administer its own self-funded costs, SMSC contracted with Blue Cross Blue Shield Minnesota (BCBS) as its health care administrator and processor for provider billing. Jorenby realized that, within the relationship between SMSC and BCBS, billed services were fully covered, and no individuals received any mailings or “explanation of benefits” paperwork, and that he could therefore submit fraudulent bills for counseling services he claimed to have provided to dozens of SMSC members without any notice to the individuals. In reality, Jorenby never provided counseling services to those individuals, and he used their names and dates of birth without their knowledge or permission. As a result of his false billing practices, SMSC suffered a loss of at least $819,020.83.

According to court documents, in 2017, Jorenby also submitted an additional fraudulent insurance claim to State Farm Insurance following a fire at his business office. In that claim, Jorenby knowingly provided false information regarding lost income, inflating his claimed income to include earnings associated with his fraudulent billings. Jorenby received a settlement of $104,930 as a result of his misrepresentation. In sentencing Mr. Jorenby, the District Court ordered him to pay SMSC $819,020.83, and State Farm Insurance $104,930, as restitution.

“When criminals commit health care fraud it can negatively affect the health care system in the form of increased fees and lower wages,” said Special Agent in Charge of Homeland Secretary Investigations (HSI) Saint Paul Jamie Holt. “These crimes are further exacerbated when they are committed by individuals, like Jorenby, who hold positions of trust throughout a community, particularly for those who relied upon him for their, or their family members’ mental well-being.”

On November 29, 2022, Jorenby pleaded guilty to one count of health care fraud. He was sentenced on September 22, 2023, by U.S. District Judge Susan Richard Nelson.

This case is the result of an investigation conducted by Homeland Security Investigations and the Minnesota Commerce Fraud Bureau.

Assistant U.S. Attorney Lindsey E. Middlecamp prosecuted the case.

Source: “Chanhassen Psychologist Sentenced to Prison for Health Care Fraud,” press release of U.S. Attorney’s Office, District of Minnesota, Sept. 29, 2023, URL: https://www.justice.gov/usao-mn/pr/chanhassen-psychologist-sentenced-prison-health-care-fraud