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Pharmacist Sentenced to 70 Months in Prison for Prescription Drug Fraud

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Pharmacist Sentenced to 70 Months in Prison for Prescription Drug Fraud

An Orange County-based pharmacist and owner of TC Medical Pharmacy pled guilty to one count of health care fraud and was sentenced to 70 months in federal prison for allegedly submitting false claims for medically unnecessary compound drug prescriptions. The defendant was also ordered to collectively pay $11.75 million in restitution to Tricare, the federal health benefits program that covers members of the uniformed services, dependents, retirees; and Amplan, Amtrak’s employee health care benefit plan.

The government alleged that, from March 2015 to December 2016, TC Medical Pharmacy submitted more than $13 million in claims to Tricare and AmPlan, of which the government paid $10,982,759 and $768,488, respectively. The defendant then allegedly paid illegal kickbacks to “marketers” of up to 50 percent of the reimbursement received from Tricare. These marketers solicited Tricare and Amplan beneficiaries through cold calls promising free compound medications (drugs specially formulated to fit a patient’s unique needs), and then generated fraudulent prescriptions for the drugs. By definition, the prescriptions for compound medications were supposed to be for unique patient needs, but instead they were formulated to maximize reimbursements and prepared on an assembly-line basis. Moreover, some beneficiaries were not contacted at all and simply received prescription drugs that they did not order.

In addition to his prison sentence and restitution order, the defendant agreed to be bound by Tricare and AmPlan program rules, including that medications be medically necessary, that beneficiaries be examined by physicians, and that his pharmacy collect co-payments.

Read the press release here.

Former Army Contractor Sentenced to 151 Months in Prison for Transnational Fraud and Money Laundering Conspiracy 

A former civilian medical records technician and administrator with the U.S. Army was sentenced to 151 months in prison after pleading guilty to one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering.

The charges arose from the defendant’s role in a large-scale fraud and money laundering conspiracy that targeted over 3,300 members of the U.S. military community.

As part of his guilty plea, the defendant admitted that he conspired to steal money belonging to military members, their dependents, and other civilians employed by the U.S. Department of Defense (DOD). Between July 2014 and September 2015, the defendant stole the personal identifying information (PII) of thousands of military members by taking digital photographs of his computer screen while logged into a military health records database.

He then provided the stolen data to a co-defendant who used the PII to access DOD and Veterans Affairs benefits sites.

As a result of the fraud, the defendants’ victims—including at least eight general officers and numerous disabled veterans, who were targeted because they receive greater service-related benefits—lost more than $1.5 million. Separate from his prison sentence, the defendant was also ordered to pay $2,331,639.85 in restitution and be placed on supervised release for three years after completing his prison term. His co-defendant was sentenced to 46 months in federal prison and ordered to pay $103,700 in restitution.

Read the press release here.


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