A special conversation on “The Future of Equality and Opportunity” with President Clinton and Founder and CEO of Theranos Elizabeth Holmes and Executive Chairman of the Alibaba Group Jack Ma, during the Closing Plenary Session of the September 2015 Clinton Global Initiative (CGI) Annual Meeting. Video
Elizabeth Holmes—the disgraced and incarcerated founder of the infamous blood-testing startup Theranos—is barred from participating in federal health programs for nine decades, according to an announcement from the health department Friday.
The exclusion means that Holmes is barred from receiving payments from federal health programs for services or products, which significantly restricts her ability to work in the health care sector. It also prevents her from participating in Medicare, Medicaid, and other federal health care programs. With a 90-year term, the exclusion is lifelong for Holmes, who is currently 39.
The exclusion was announced by Inspector General Christi Grimm of the Department of Health and Human Services’ Office of Inspector General.
Holmes is serving an 11-year, three-month sentence for defrauding investors of her blood-testing startup, Theranos, which she founded in 2003. At the time, Holmes claimed to have developed proprietary technology that could perform hundreds of medical tests using just a small drop of blood from a finger prick. The remarkable claim helped her drive the company’s valuation to a stunning $9 billion in 2014, and set up lucrative partnerships. But, in reality, the technology never worked. The company collapsed in 2018, and she was convicted of fraud in 2022.
In today’s announcement, the health department noted that the statutory minimum on exclusions for convictions like Holmes’ is just five years. But other factors are considered when determining the term, including how long the fraud took place, the length of the prison sentence, and the amount of restitution ordered. In addition to her 11-year prison sentence, Holmes was ordered to pay approximately $452,047,200 in restitution, the HHS-OIG noted.
“Accurate and dependable diagnostic testing technology is imperative to our public health infrastructure. False statements related to the reliability of these medical products can endanger the health of patients and sow distrust in our health care system,” Grimm said. “As technology evolves, so do our efforts to safeguard the health and safety of patients, and HHS-OIG will continue to use its exclusion authority to protect the public from bad actors.”
HHS-OIG also excluded former Theranos President Ramesh Balwani from federal health programs for 90 years. Balwani was also convicted of fraud and is serving a nearly 13-year sentence.