The Law of Compounding Medications And Drugs
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Monday, September 20, 2021
Friday, September 17, 2021
South Hills Pharmacist Pleads to Health Care Fraud Conspiracy, Fraudulently Obtaining Controlled Substances and Misbranding Drugs
Department of Justice
South Hills Pharmacist Pleads to Health Care Fraud Conspiracy, Fraudulently Obtaining Controlled Substances and Misbranding Drugs
PITTSBURGH, PA - A South Hills pharmacist pleaded guilty in federal court to charges of obtaining controlled substances by fraud, misbranding of drugs, and health care fraud conspiracy, Acting United States Attorney Stephen R. Kaufman announced today.
Timothy W. Forester, 46, of Venetia, PA pleaded guilty to three counts before Senior United States District Judge David S. Cercone.
In connection with the guilty plea, the court was advised that Forester was a licensed pharmacist who owned four pharmacies – Century Square Pharmacy in West Mifflin, PA and Prescription Center Plus with locations in South Park, PA, McMurray, PA and Eight Four, PA. From on or about November 14, 2018, to on or about February 14, 2019, Forester admitted he knowingly, intentionally and unlawfully obtained oxycodone and hydrocodone, Schedule II controlled substances, by misrepresentations, fraud, and deception. Forester admitted he did not place the controlled substances into the inventories of the four pharmacies and did not maintain records to show the controlled substances were dispensed. In addition, Forester admitted he relabeled generic drugs as name brand medications and then sold them as if they were the more expensive drugs. Finally, Forester admitted filling prescriptions with generic drugs, but billing Medicare and Medicaid for the more expensive name brand drugs, thereby committing health care fraud and causing a loss to Medicare and Medicaid of approximately $680,000.
“Timothy Forester ordered opioids without adding them to inventory, mislabeled generic drugs as name-brand medications, and billed Medicare and Medicaid for name-brand drugs when he provided generics, all in violation of federal law,” said Acting U.S. Attorney Kaufman, “We will continue to pursue medical professionals who engage in fraud schemes to enrich themselves at the expense of their patients.”
“U.S. consumers rely on health care professionals to follow FDA requirements pertaining to prescription medications. When they take actions to evade these requirements, they put patient health at risk,” said Special Agent in Charge Mark S. McCormack, FDA Office of Criminal Investigations Metro Washington Field Office. “We will continue to investigate and bring to justice those who threaten the safety of the nation’s drug supply and, ultimately, the patients who take those drugs.”
“Pharmacy professionals who mishandle opioids in an effort to enrich themselves only exacerbate the challenges and devastation families and communities experience as a result of our nation's opioid epidemic," said Maureen R. Dixon, Special Agent in Charge for the Inspector General’s Office of the U.S. Department of Health and Human Services in Philadelphia. “We will continue to work with our law enforcement partners to bring unscrupulous health professionals to justice.”
“Pharmacists such as Forester have an obligation to properly dispense and safeguard controlled substances such as oxycodone and hydrocodone,” said Thomas Hodnett, Acting Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Philadelphia Field Division. “Forester used his position of trust and access to obtain these powerful painkillers for his own use through fraud and deception.”
Judge Cercone scheduled sentencing for February 8, 2020 at 11:30 a.m. As to Count 1, the law provides for a maximum sentence of four years in prison, a fine of $250,000 or both. As to Count 11, the law provides for a maximum sentence of three years in prison, a fine of $250,000 or both. As to Count 12, the law provides for a maximum sentence of 10 years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Robert S. Cessar is prosecuting this case on behalf of the government.
The investigation leading to the filing of charges in this case was conducted by the Western Pennsylvania Opioid Fraud and Abuse Detection Unit, which combines personnel and resources from the following agencies to combat the growing prescription opioid epidemic: Federal Bureau of Investigation, U.S. Health and Human Services – Office of Inspector General, Drug Enforcement Administration, Internal Revenue Service-Criminal Investigations, Pennsylvania Office of Attorney General - Medicaid Fraud Control Unit, United States Postal Inspection Service, U.S. Attorney’s Office – Criminal Division, Civil Division and Asset Forfeiture Unit, Department of Veterans Affairs-Office of Inspector General, Food and Drug Administration-Office of Criminal Investigations and the Pennsylvania Bureau of Licensing.
A federal grand jury today returned a five-count indictment charging a Gloucester County, New Jersey, man with defrauding his employer’s health insurance plan out of more than $4 million by submitting fraudulent claims for medically unnecessary compounded medications, Acting U.S. Attorney Rachael A. Honig announced today.
Department of Justice
Gloucester County Man Charged with Fraud for Role in Healthcare Conspiracy
CAMDEN, N.J. – A federal grand jury today returned a five-count indictment charging a Gloucester County, New Jersey, man with defrauding his employer’s health insurance plan out of more than $4 million by submitting fraudulent claims for medically unnecessary compounded medications, Acting U.S. Attorney Rachael A. Honig announced today.
Christopher Gualtieri, 48, of Franklinville, New Jersey, is charged with conspiracy to commit health care fraud and mail fraud and individual acts of mail fraud. Gualtieri was also charged with making false statements to federal agents during the investigation, as well as preparing and filling fraudulent oxycodone prescriptions. Gualtieri is scheduled to appear today by videoconference before U.S. Magistrate Judge Sharon A. King. The case is assigned to U.S. District Judge Robert B. Kugler in Camden.
According to the indictment:
Compounded medications are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Compounded drugs can be properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredient.
Gualtieri and others learned that certain compound medication prescriptions – including vitamins, scar creams, pain creams, and sunscreens – were reimbursed by their health insurance plan for up to thousands of dollars for a one-month supply. Gualtieri recruited co-workers who were covered by their employer’s self-funded health insurance plan to agree to receive medically unnecessary compounded medications for themselves and their family members. Gualtieri and others caused the submission of fraudulent prescriptions to compounding pharmacies, which filled the prescriptions and billed the health insurance plan’s pharmacy benefits administrator. The pharmacy benefits administrator paid the compounding pharmacies more than $4 million for compounded medications arranged by Gualtieri and two conspirators for themselves, their dependents, and other family members. Gualtieri received a portion of the amount paid by the pharmacy benefits administrator to the compounding pharmacies. Gualtieri then paid cash and other remuneration to his conspirators for their participation in the scheme. When questioned by special agents of the FBI, Gualtieri falsely denied recruiting others to receive compounded medications and falsely denied paying cash to others for their participation in the scheme.
During the same time period as the conspiracy involving compounded medications, Gualtieri also prepared and filled fraudulent prescriptions for oxycodone for himself and a family member.
Gualtieri faces a maximum penalty on the conspiracy and mail fraud counts of 20 years in prison, a maximum penalty on the false statements count of five years in prison, and a maximum penalty on the obtaining drugs by fraud count of four years in prison. He also faces a fine on each count of up to $250,000 or twice the gross gain or gross loss from the offense, whichever is greatest.
Acting U.S. Attorney Honig credited agents of the FBI, Philadelphia Field Office, Health Care Fraud Task Force, under the direction of Acting Special Agent in Charge Bradley S. Benavides, and task force members from the Pennsylvania Attorney General’s Office, Department of Health and Human Services – Office of Inspector General, and the Philadelphia Police Department, as well as diversion investigators of the Drug Enforcement Administration, New Jersey Division, Camden Resident Office, under the direction of Special Agent in Charge Susan A. Gibson, with the investigation leading to the indictment. Acting U.S. Attorney Honig also thanked U.S. Postal Service – Office of Inspector General, for their assistance in the investigation.
The government is represented by Assistant U.S. Attorney Jeffrey Bender of the U.S. Attorney’s Office in Camden.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Department of Justice
National healthcare fraud enforcement action results in charges involving more than $1.4 billion in alleged losses
Six defendants, more than $50 million in Southern District of Georgia
WASHINGTON: A strategically coordinated, six-week nationwide federal law enforcement action has resulted in criminal charges against 138 defendants, including 42 doctors, nurses, and other licensed medical professionals, in 31 federal districts across the United States for their alleged participation in various healthcare fraud schemes for more than $1.4 billion in alleged losses.
The enforcement action includes criminal charges against six defendants here in the Southern District of Georgia. The charges announced involve some defendants accused of committing a kickback conspiracy involving cancer genomic testing claims, and other defendants accused of illegal distribution of opioids. The Southern District of Georgia’s announced charges account for more than $50 million in collective billings to federal health benefit programs.
Nationwide, the charges target approximately $1.1 billion in fraud committed using telemedicine, more than $29 million in COVID-19 health care fraud, more than $133 million connected to substance abuse treatment facilities, or “sober homes,” and more than $160 million connected to other health care fraud and illegal opioid distribution schemes across the country.
“The vigilance of our law enforcement partners plays a vital role in identifying illegal healthcare activities throughout the nation and the Southern District of Georgia,” said David H. Estes, Acting U.S. Attorney for the Southern District of Georgia. “We will continue to hold accountable those who would seek to gain illicit profit by criminally exploiting our nation’s healthcare safety net.”
“This nationwide enforcement action demonstrates that the Criminal Division is at the forefront of the fight against health care fraud and opioid abuse by prosecuting those who have exploited health care benefit programs and their patients for personal gain,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “The charges announced today send a clear deterrent message and should leave no doubt about the department’s ongoing commitment to ensuring the safety of patients and the integrity of health care benefit programs, even amid a continued pandemic.”
Today’s enforcement actions were led and coordinated by the Health Care Fraud Unit of the Criminal Division’s Fraud Section, in conjunction with its Health Care Fraud and Appalachian Regional Prescription Opioid (ARPO) Strike Force program, and its core partners, the U.S. Attorneys’ Offices, the Department of Health and Human Services Office of Inspector General (HHS-OIG), FBI, and the Drug Enforcement Administration (DEA), as part of the department’s ongoing efforts to combat the devastating effects of health care fraud and the opioid epidemic. The Southern District of Georgia worked with the Justice Department’s Criminal Division and agents from HHS-OIG, FBI, and DEA in the investigation and prosecution of these cases.
Telemedicine Fraud Cases
The largest amount of alleged fraud loss charged in connection with the cases announced today – more than $1.1 billion in allegedly false and fraudulent claims submitted by 43 criminal defendants in 11 judicial districts nationwide – relates to schemes involving telemedicine: the use of telecommunications technology to provide health care services remotely. In the Southern District of Georgia, two marketers were charged by way of Information relating to their role in a conspiracy that bought and sold cancer genomic (“CGx”) testing for Medicare beneficiaries. Court documents allege that the CGx tests bought in that conspiracy were ultimately billed to Medicare by a series of laboratories for more than $45 million.
The continued focus on prosecuting health care fraud schemes involving telemedicine reflects the success of the nationwide coordinating role of the Fraud Section’s National Rapid Response Strike Force.
“Healthcare crimes hurt every taxpayer and put profits over the care of our nation’s most vulnerable citizens,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “It puts a tremendous strain on our federally-subsidized health care programs. The FBI and our federal partners will hold accountable anyone who usurps healthcare assistance for their personal greed.”
The focus on telemedicine fraud also builds on the telemedicine component of last year’s national takedown and the impact of the 2019 “Operation Brace Yourself” Telemedicine and Durable Medical Equipment Takedown, which resulted in an estimated cost avoidance of more than $1.9 billion in the amount paid by Medicare for orthotic braces in the 20 months following that takedown. The Southern District of Georgia has played a major role in these nationwide schemes, having charged more than 30 defendants responsible for a collective $1.6 billion in billings across Operation Brace Yourself, Operation Double Helix, and Operation Rubber Stamp. The Southern District of Georgia kickback charges announced today are being prosecuted by Assistant U.S. Attorney Jonathan A. Porter.
Cases Involving the Illegal Prescription and/or Distribution of Opioids and Cases Involving Traditional Health Care Fraud Schemes
The cases announced today involving the illegal prescription and/or distribution of opioids include 19 defendants, including several charges against medical professionals and others who prescribed more than 12 million doses of opioids and other prescription narcotics while submitting more than $14 million in false billings. The cases that fall into more traditional categories of healthcare fraud include charges against more than 60 defendants who allegedly participated in schemes to submit more than $145 million in false and fraudulent claims to Medicare, Medicaid, TRICARE, and private insurance companies for treatments that were medically unnecessary and often never provided.
In the Southern District of Georgia, three South Georgia medical professionals were indicted for illegal distribution of opioids and conspiracy to commit health care fraud. The indictment alleges that the charged physician, nurse practitioner, and physician assistant operated a nominal pain clinic that distributed opioids with no legitimate medical purpose. These charges are being prosecuted by Assistant U.S. Attorneys Matthew A. Josephson and Bradford C. Patrick.
“The public relies on medical professionals to be part of the solution to our nation’s prescription drug abuse epidemic – not to worsen the problem by distributing controlled substances without a legitimate medical purpose," said Special Agent in Charge Derrick L. Jackson of HHS-OIG. “Working closely with our law enforcement partners, we will continue to investigate unscrupulous providers who prey on vulnerable members of the public.”
“Medical practitioners who unlawfully dispense dangerous, addictive and potentially deadly substances do so under the guise of a stethoscope and white coat to hide behind a veil of legitimacy. They commit fraudulent acts and prey on patients who are addicted to prescription opioids and are unfit to administer care to anyone,” said Robert J. Murphy, Special Agent in Charge of the DEA Atlanta Field Division. “DEA and its law enforcement partners stand united and are committed to bringing those to justice who engage in these unlawful acts.”
Prior to the charges announced as part of today’s nationwide enforcement action and since its inception in March 2007, the Health Care Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,600 defendants who have collectively billed the Medicare program for approximately $23 billion. In addition to the criminal actions announced today, CMS, working in conjunction with HHS-OIG, announced 28 administrative actions to decrease the presence of fraudulent providers.
The National Rapid Response Strike Force also announced prosecutions across the country today regarding $128 million in COVID-19 fraud, cases and nearly $1 billion in fraud cases involving sober homes.
A complaint, information or indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
To view Assistant Attorney General Polite’s remarks, go to: https://www.justice.gov/opa/video/assistant-attorney-general-kenneth-polite-jr-delivers-remarks-health-care-enforcement.
Department of Justice
National Health Care Fraud Enforcement Action Results in Charges of Over $308 Million in Intended Loss Against 52 Defendants in the Southern District of Florida
Miami, Florida – Over 50 defendants were charged in the Southern District of Florida in the last six weeks, as part of a nationwide federal law enforcement action to combat health care fraud.
The federal charges filed in South Florida cover a wide range of schemes, from novel crimes like theft of Covid-19 personal protection equipment and fraud connected to substance abuse treatment facilities (sober homes), to more familiar violations like health care fraud involving durable medical equipment suppliers, home health, pharmacies, payment of kickbacks, money laundering, and more. It is alleged that $308 million in fraudulent claims was billed by the defendants charged in the Southern District of Florida during the six-week enforcement period. Over $106 million of that billed amount was paid.
Nationwide, 138 defendants, including 42 doctors, nurses, and other licensed medical professionals, in 31 federal districts across the United States, were charged during the enforcement period for their alleged participation in various healthcare fraud schemes that resulted in approximately $1.4 billion in alleged losses. Nationally, the charges target approximately $1.1 billion in fraud committed using telemedicine (the use of telecommunications technology to provide health care services remotely), $29 million in COVID-19 health care fraud, $133 million connected to substance abuse treatment facilities, or “sober homes,” and $160 million connected to other health care fraud and illegal opioid distribution schemes across the country.
“The results of the coordinated law enforcement effort that we announce today exemplify my Office and its law enforcement partners’ enduring commitment to combatting all forms of health care fraud-related schemes.” said Juan Antonio Gonzalez, Acting U.S. Attorney for the Southern District of Florida. “We will not relent in holding accountable those in South Florida who exploit health care programs and patient trust for personal gain, particularly during the COVID-19 global pandemic.”
“This nationwide enforcement action demonstrates that the Criminal Division is at the forefront of the fight against health care fraud and opioid abuse by prosecuting those who have exploited health care benefit programs and their patients for personal gain,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “The charges announced today send a clear deterrent message and should leave no doubt about the department’s ongoing commitment to ensuring the safety of patients and the integrity of health care benefit programs, even amid a continued pandemic.”
Today’s enforcement actions were led and coordinated by the Health Care Fraud Unit of the Criminal Division’s Fraud Section, in conjunction with its Health Care Fraud and Appalachian Regional Prescription Opioid (ARPO) Strike Force program, and its core partners, the U.S. Attorneys’ Offices, the Department of Health and Human Services Office of Inspector General (HHS-OIG), FBI, and the Drug Enforcement Administration (DEA), as part of the department’s ongoing efforts to combat the devastating effects of health care fraud and the opioid epidemic.
The Southern District of Florida, in particular, worked with the Department’s Criminal Division and the following law enforcement organizations to investigate and prosecute the cases filed during the enforcement period: FBI Miami; U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), Miami Region; Social Security Administration, Office of Inspector General (SSA-OIG), Atlanta Field Division; Homeland Security Investigations (HSI), Miami; United States Postal Inspection Service (USPIS), Miami Region; Florida’s Office of the Attorney General, Medicaid Fraud Control Unit (MFCU); Florida State Attorney’s Office; City of Miami Beach Police Department; Palm Beach County Sober Homes Task Force; Amtrack Office of the Inspector General; and the Department of Insurance Fraud.
“South Florida is ground zero for health care fraud. As such, the FBI and its partners devote vast resources to investigate, catch and prosecute those committing this fraud,” said George L. Piro, Special Agent in Charge, FBI Miami. The victims are U.S. taxpayers, you and me. Our message to those who commit health care fraud and steal from U.S. taxpayers is clear: you will be caught, and you will be punished.”
“Healthcare fraud is hardly a victimless crime. The well-being and trust of patients and taxpayers are at risk when corrupt providers engage in schemes that drain taxpayer-funded health care programs and undermine impartial medical judgement,” said Special Agent in Charge Omar Pérez Aybar of HHS-OIG Miami. “These cases demonstrate our resolve to investigate bad actors and protect the patients served by vital federal health and human services programs.”
“Those who misuse the Social Security numbers of other individuals for personal gain are warned -- we will hold you accountable.” said Rodregas W. Owens, Special Agent-in-Charge, SSA-OIG, Atlanta Field Division. “We will continue to work aggressively to identify such fraud in an effort to protect taxpayers against fraud, waste, and abuse.”
“We as a law enforcement community will not allow individuals to defraud government health-care programs for their own personal gain,” said Anthony Salisbury, Special Agent in Charge, HSI Miami. “HSI and its partners will continue to pursue individuals and companies who are taking advantage of innocent patients seeking medical care.”
“My Medicaid Fraud Control Unit works tirelessly to stop the exploitation of the taxpayer-funded Medicaid program and protect the vulnerable Floridians who rely on its services. I’m proud of our partnership with federal authorities to hold these criminals abusing the system accountable,” said Florida Attorney General Ashley Moody.
COVID-19 Fraud Cases
Across the nation, nine defendants are charged with engaging in various health care fraud schemes designed to exploit the COVID-19 pandemic, which resulted in the submission of over $29 million in false billings.
In the Southern District of Florida, for example, a defendant is charged with stealing personal protective equipment from a hospital and reselling it at inflated prices:
In U.S. v. Rickey Delancey, Jr., Case No. 21-20471-Cr-Moore, a 30-year-old Miami resident is charged by indictment with conspiracy to steal medical products, theft of medical products, and transportation of stolen goods. According to the indictment, Delancey worked in the supplies department of Mount Sinai Hospital. From about April to November 2020, Delancey stole N95 masks and other medical supplies from his workplace and sold them to various purchasers. Among other items, he sold $55,000 worth of stolen masks to a purchaser in California, says the indictment. As a result of the thefts, during the height of the COVID-19 pandemic, Mount Sinai did not have the supplies needed for nurses, doctors, staff, and patients, and at one point was down to only a three-day supply of N95 masks.
FBI Miami and USPIS Miami investigated this case, along with City of Miami Beach Police Department. Southern District of Florida Assistant U.S. Attorney Lindsey Lazopoulos Friedman is prosecuting it.
The law enforcement action today also includes criminal charges against five defendants across the country who allegedly engaged in the misuse of Provider Relief Fund monies. The Provider Relief Fund is part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, a federal law enacted March 2020 designed to provide needed medical care to Americans suffering from COVID-19.
The COVID-19 cases announced today build upon the success of the COVID-19 Health Care Fraud Takedown on May 26, a coordinated law enforcement action against 14 defendants in seven judicial districts for over $128 million in false billings. The law enforcement action and the cases announced today were brought in coordination with the Health Care Fraud Unit’s COVID-19 Interagency Working Group, which is chaired by the National Rapid Response Strike Force and organizes efforts to address illegal activity involving health care programs during the pandemic.
Sober Homes Cases
Today’s announcement of sober homes cases charged across the nation coincides with the one-year anniversary of the first national sober homes initiative in 2020, which included charges against more than a dozen criminal defendants in connection with more than $845 million of allegedly false and fraudulent claims for tests and treatments for vulnerable patients seeking treatment for drug and/or alcohol addiction. The over $133 million in false and fraudulent claims that are additionally alleged in cases announced today reflect the continued effort by the National Rapid Response Strike Force and the Health Care Fraud Unit’s Los Angeles Strike Force, with the participation of the U.S. Attorney’s Offices for the Central District of California and the Southern District of Florida, to prosecute those who participated in illegal kickback and bribery schemes involving the referral of patients to substance abuse treatment facilities; those patients could be subjected to medically unnecessary drug testing – often billing thousands of dollars for a single test – and therapy sessions that frequently were not provided, and which resulted in millions of dollars of false and fraudulent claims being submitted to private insurers.
In the Southern District of Florida, two defendants are charged with sober homes fraud:
In United States v. Mimi Bieda and Levi Bieda a/k/a Larry, Case No. 21-80112-CR-Rosenberg, Mimi Bieda, 62, and Levi Bieda, 36, of West Palm Beach, Florida, are charged by information with conspiracy to commit $128 million of health care fraud. According to the information, the Biedas owned and operated Academy Health Solutions, LLC (“Academy”), a substance abuse treatment center in Palm Beach County, Florida, as well as a sober home and detox facilities. They also had ownership interest in several drug testing laboratories. It is alleged that the Biedas hired a medical director for Academy, Dr. Michael Ligotti, who signed standing orders for medically unnecessary and expensive drug testing in exchange for patient referrals. Dr. Ligotti then billed the patients’ insurance plans for duplicative, excessive, non-rendered, and/or medically unnecessary treatment and testing. The Biedas used the standing orders signed by Dr. Ligotti, and by a subsequent medical director at Academy, to authorize medically unnecessary drug testing at laboratories in which they had an ownership interest, allowing them to receive percentages of all claim reimbursements for those tests, says the information. It is alleged that the Biedas also paid kickbacks and bribes, in the form of free or reduced rent, access to controlled substances provided by Academy’s medical directors, and other benefits, to individuals who agreed to live at their sober home, attend treatment at Academy, and submit to drug testing, so that the Biedas could bill these services to the residents’ insurance plans.
FBI Miami investigated this case, along with Palm Beach County Sober Homes Task Force, Florida State Attorney’s Office, Amtrack Office of the Inspector General, and Department of Insurance Fraud. Southern District of Florida Assistant United States Attorneys Alexandra Chase and Danielle Croke, as well as National Rapid Response Strike Force Senior Litigation Counsel James V. Hayes and Trial Attorney Ligia Markman are prosecuting it.
Cases Involving Traditional Healthcare Fraud Schemes and the Illegal Prescription and/or Distribution of Opioids
The cases announced today that fall into more traditional categories of health care fraud include charges filed across the nation against over 60 defendants who allegedly participated in schemes to submit more than $145 million in false and fraudulent claims to Medicare, Medicaid, TRICARE, and private insurance companies for treatments that were medically unnecessary and often never provided. Cases filed across the nation involving the illegal prescription and/or distribution of opioids involve 19 defendants, including several charges against medical professionals and others who prescribed over 12 million doses of opioids and other prescription narcotics, while submitting over $14 million in false billings.
In the Southern District of Florida, defendants are charged in cases involving a wide range of traditional health care fraud schemes. Some of the cases charged in the Southern District of Florida during the six-week enforcement period include the following:
In United States v. Edward Pizzi, Case No. 21-20467-CR-Altman, a 40-year-old from Miami, Florida is charged by information with conspiracy to pay health care kickbacks. According to the information, Pizzi owned and operated Miami-based Rios Medical Center and Union Medical Clinic. Pizzi directed his employees to pay kickbacks to recruit Medicare beneficiaries and Medicaid recipients to the clinics. The clinics used the identification numbers of these beneficiaries and recipients to submit claims to Medicare Part C and Medicaid for, among other things, purported mental health therapy services. Most of the recruited beneficiaries neither needed nor qualified for such services.
FBI Miami, HHS-OIG Miami, and MFCU investigated this case. Southern District of Florida Assistant U.S. Attorney Michael Homer is prosecuting it.
In United States v. Mayara Gonzalez Chaviano, Case No. 21-20468-CR-King, a 28-year-old Miami, Florida resident is charged by information with conspiracy to pay health care kickbacks. According to the information, Chaviano was the office manager of Rios Medical Center and Union Medical Clinic, in Miami, Florida. Chaviano managed the clinics’ scheme to pay kickbacks to recruit Medicare beneficiaries and Medicaid recipients to the clinics. The clinics used the identification numbers of these beneficiaries and recipients to submit claims to Medicare Part C and Medicaid for, among other things, purported mental health therapy services. Most of the recruited beneficiaries neither needed nor qualified for such services.
FBI Miami, HHS-OIG Miami, and MFCU investigated this case. Southern District of Florida Assistant U.S. Attorney Michael Homer is prosecuting it.
In United States v. Liliana Liseth Duarte, Case No. 21-20469-CR-Bloom, a 47-year-old resident of Miami, Florida, is charged by information with conspiracy to pay health care kickbacks. According to the information, Duarte was an employee of Rios Medical Center and Union Medical Clinic, in Miami, Florida. Duarte paid kickbacks to individuals to recruit Medicare beneficiaries and Medicaid recipients to the clinics. The clinics used the identification numbers of these beneficiaries and recipients to submit claims to Medicare Part C and Medicaid for, among other things, purported mental health therapy services. Most of the recruited beneficiaries neither needed nor qualified for such services.
FBI Miami, HHS-OIG Miami, MFCU investigated this case. Southern District of Florida Assistant U.S. Attorney Michael Homer is prosecuting it.
In United States v. Jason Kashou, Case No. 21-60245-CR-Dimitrouleas, the 35-year-old owner of 1st Choice is charged by information with conspiracy to solicit and receive illegal kickbacks from pharmacies. Kashou bought Medicare and Medicaid beneficiary information from a call center in India. Kashou then agreed to provide the beneficiary information to pharmacies so that the pharmacies could fill prescriptions for expensive diabetic supplies and topical pain creams. In exchange, the pharmacies agreed to pay Kashou a percentage of the profits from the amount Medicare and Medicaid paid on a per patient basis.
On September 14, Kashou pled guilty to the charge. His sentencing hearing is set for November 23, at 1:15 p.m., before U.S. District Judge William P. Dimitrouleas.
HSI Miami, HHS-OIG Miami and MFCU investigated this case. Southern District of Florida Assistant U.S. Attorneys Stephanie Hauser and Michael Gilfarb are prosecuting it.
In United States v. Greisy Rosario Varona Docasal, Case No. 21-20439-CR-Cooke, a 52-year-old Miami, Florida resident is charged by indictment with conspiracy to receive health care kickbacks, and substantive counts of receiving kickbacks in connection with a federal health care program. According t0 the indictment, Varona Docasal, as office manager of a doctor’s office, was involved in a scheme to illegally recruit Medicare beneficiaries and refer them to home health agencies in exchange for receiving illegal kickbacks from the owners and operators of the home health agencies who in turn billed Medicare for home health services for the recruited Medicare beneficiaries.
HHS-OIG Miami investigated this case. Southern District of Florida Assistant U.S. Attorney Aimee C. Jimenez is prosecuting it.
In United States v. Mayra De La Paz, Case No. 21-20474-CR-Bloom, a 69-year-old resident of Hialeah, Florida is charged by information with conspiracy to solicit and receive kickbacks in connection with a federal health care program. According to the information, De La Paz participated in a conspiracy to solicit and receive kickback payments for the referral of Medicare beneficiaries to a home health agency.
HHS-OIG Miami and FBI Miami investigated this case. Southern District of Florida Assistant U.S. Attorney Timothy J. Abraham is prosecuting it.
In U.S. v. Michael Marcelus Mogollon, Case No. 21-20432-CR-Moore, a 33-year-old from Miami, Florida is charged by information with conspiracy to commit health care and wire fraud. According to the information, Mogollon paid kickbacks to beneficiaries with Blue Cross Blue Shield health insurance in exchange for the patients allowing Miami clinics Quality Professional, Zion Medical, and Renewal to bill the insurance plans for medical benefits, items, and services, that were not medically necessary, not eligible for reimbursement, and not received by the beneficiaries. As a result of Mogollon’s participation in the conspiracy, the clinics billed Blue Cross Blue Shield approximately $678,800, and Blue Cross Blue Shield paid approximately $220,000 based on the false claims, says the information.
FBI Miami investigated this case. Southern District of Florida Assistant U.S. Attorney Lindsey Lazopoulos Friedman is prosecuting it.
In U.S. v. Jorge Luis Taboada, Case No. 21-20443-CR-Williams, a 52-year-old resident of Miami, Florida is charged by information with conspiracy to commit health care and wire fraud. According to the information, Taboada paid kickbacks to beneficiaries with Blue Cross Blue Shield and Aetna health insurance in exchange for the patients allowing United Medical of South Florida, d/b/a Sleep Study of South Florida, Inc. to bill the insurance plans for medical benefits, items, and services, that were not medically necessary, not eligible for reimbursement, and not received by the beneficiaries. As a result of Taboada’s participation in the conspiracy, the clinics billed Blue Cross Blue Shield and Aetna between $1,500,000 and $3,500,000, says the information.
FBI Miami investigated this case. Southern District of Florida Assistant U.S. Attorney Lindsey Lazopoulos Friedman is prosecuting it.
In United States of America vs. Patricia M. Cleary, a/k/a Patricia M. Cleary Syling, a/k/a Patricia M. Syling, a/k/a Patricia A. Cleary, Case No. 21-60262-CR-Singhal, a 51-year-old from Odessa, Florida is charged by indictment with one count of falsely representing a social security number and one count of aggravated identity theft.
According to the indictment, Cleary knowingly gave a false social security number to a Medicaid Managed Care Organization while applying for a job with the company. The social security number did not belong to Cleary. Instead, it belonged to a victim living in a different state. Cleary did this to hide her real identity from the company, says the indictment.
HHS-OIG Miami, State of Florida Medicaid Fraud Control Unit, SSA-OIG Miami, and FBI Miami investigated this case. Southern District of Florida Special Assistant U.S. Attorney Marc Canzio is prosecuting it.
In United States v. Julio Cesar Betancourt, Case No. 21-20425-CR-Moore, a 31-year-old resident of Hialeah Gardens, Florida is charged by information with conspiracy to commit money laundering. According to the information, Betancourt, as owner of owner of JD Solution USA, Inc., conspired to launder $363,139 in health care fraud proceeds between July 2019 and October 2019. These proceeds were related to a durable medical equipment company located in Miami that was committing health care fraud, says the information.
HHS-OIG Miami and FBI Miami investigated this case. Southern District of Florida Assistant U.S. Attorney Timothy J. Abraham is prosecuting it.
In United States v. Jorge Luis Lopez Pena, Case No. 21-CR-20466-Gayles, a 36-year-old from Miami, Florida is charged by information with conspiracy to commit money laundering. According to the information, Lopez Pena, as owner of Lopez Distributors, Inc., conspired to launder $185,671 in health care fraud proceeds between August 2019 and December 2019. These health care fraud proceeds were related to a durable medical equipment company located in Miami that was committing health care fraud, says the information.
HHS-OIG Miami and FBI Miami investigated this case. Southern District of Florida Assistant U.S. Attorney Timothy J. Abraham is prosecuting it.
In U.S. v. Angel Pimentel, Case No. 21-20420-CR-King, a 72-year-old from Miami, Florida, is charged by indictment with conspiracy to commit health care fraud and substantive counts of health care fraud. According to the indictment, Pimentel owned Maggie Pharmacy Discount, Inc. From about March 2015 to August 2019, Pimentel submitted $988,983 in claims to Medicare, which falsely and fraudulently represented that various health care benefits, primarily prescription drugs, were medically necessary, prescribed by a doctor, and had been provided by Maggie Pharmacy Discount, Inc. to Medicare beneficiaries. As a result of the false claims, Medicare prescription drug plan sponsors, through their pharmacy benefit managers, made payments funded by the Medicare Part D Program to the corporate bank accounts of Maggie Pharmacy Discount, Inc. of at least $988,983, says the indictment.
HHS-OIG Miami and FBI Miami investigated this case. Southern District of Florida Assistant U.S. Attorney Christopher J. Clark is prosecuting it.
Prior to the charges announced as part of today’s nationwide enforcement action and since its inception in March 2007, the Health Care Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,600 defendants who have collectively billed the Medicare program for approximately $23 billion. In addition to the criminal actions announced today, CMS, working in conjunction with HHS-OIG, announced 28 administrative actions to decrease the presence of fraudulent providers.
Telemedicine Fraud Cases
More than 43 criminal defendants in 11 judicial districts nationwide are charged in cases involving telemedicine: the use of telecommunications technology to provide health care services remotely. It is alleged that these telemedicine defendants filed over $1.1 billion in fraudulent claims.
The continued focus on prosecuting health care fraud schemes involving telemedicine reflects the success of the nationwide coordinating role of the Fraud Section’s National Rapid Response Strike Force, the creation of which was announced at the 2020 National Health Care Fraud and Opioid Takedown. The National Rapid Response Strike Force helped coordinate the prosecution of the telemedicine initiative, Sober Homes initiative, and COVID-19 cases that were announced today. The focus on telemedicine fraud also builds on the telemedicine component of last year’s national takedown and the impact of the 2019 “Operation Brace Yourself” Telemedicine and Durable Medical Equipment Takedown, which resulted in an estimated cost avoidance of more than $1.9 billion in the amount paid by Medicare for orthotic braces in the 20 months following that takedown.
Health Care Fraud Prosecutions in the Southern District of Florida for
Fiscal Year 2020-2021
The Southern District of Florida is a national leader in health care fraud prosecutions. So far, during the 2020-2021 Fiscal Year (from October 1, 2020 through today), a total of 196 defendants have been charged in the Southern District of Florida with health care fraud-related offenses. It is alleged that approximately $2.2 billion was billed by these defendants and that approximately $488 million was paid.
A complaint, information or indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
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High Importance! Federal Court Enters Consent Decree Against Florida Compounder, Prohibiting Manufacture and Distribution of Drugs Due to Insanitary Conditions
Federal Court Enters Consent Decree Against Florida Compounder, Prohibiting Manufacture and Distribution of Drugs Due to Insanitary Conditions
The U.S. District Court for the Middle District of Florida has entered a consent decree of permanent injunction that prohibits a Florida-based company from producing or distributing any drugs until the company complies with the Federal Food, Drug, and Cosmetic Act (FD&C Act) and other requirements.
According to the complaint, filed by the U.S. Department of Justice on behalf of the U.S. Food and Drug Administration (FDA), Premier Pharmacy Labs Inc. and the company’s owner, Vern A. Allen, manufactured and distributed drugs made under insanitary conditions at Premier Pharmacy’s facility, despite multiple warnings from the FDA. Premier stopped manufacturing drugs following an FDA inspection in June 2019.
“Premier Pharmacy and its owner placed patients at significant risk. Outsourcing facilities must follow good manufacturing practice to ensure patients are not exposed to poor quality, potentially harmful drugs,” said Donald D. Ashley, J.D., director of the Office of Compliance in the FDA’s Center for Drug Evaluation and Research. “We will continue to take appropriate enforcement actions to ensure that companies follow important safety requirements to avoid putting patients’ health at risk.”
The consent decree requires Premier Pharmacy to not engage in any compounding operations or distribution until it completes corrective actions, to ensure the company and its facility are in compliance with the FD&C Act. Under the consent decree, Premier Pharmacy may not resume compounding operations until it establishes and implements, among other things, a comprehensive quality control system and receives authorization from the FDA.
The complaint alleged that Premier Pharmacy manufactured and distributed drugs, including drugs that were intended to be sterile, that were adulterated because the drugs were made under insanitary conditions and in violation of good manufacturing practice requirements under the FD&C Act. Insanitary conditions can cause a compounded drug to become contaminated or otherwise cause patient harm. According to the complaint, Premier Pharmacy also manufactured and distributed drugs that were neither approved nor exempt from approval because the products did not meet all statutory requirements for outsourcing facilities.
In the spring of 2014, the FDA conducted an inspection of Premier Pharmacy that resulted in a warning letter for insanitary conditions and other violations of the FD&C Act. The FDA conducted a follow-up inspection in June 2016, leading to a regulatory meeting with the company in January 2018. In April 2018, Premier Pharmacy recalled affected sterile injectable products due to potential lack of sterility assurance. The FDA conducted another follow-up inspection which started in April 2019. In June 2019, following the April inspection and the FDA’s recommendation to recall, Premier Pharmacy recalled all unexpired drugs intended to be sterile. Premier Pharmacy had been registered as an outsourcing facility for compounded drugs; however, the company deregistered in 2019 and has since stopped compounding drugs.
Compounded drugs can serve an important role for patients whose medical needs cannot be met by an FDA-approved drug product. Compounded drugs are not approved by the FDA and, therefore, have not been evaluated for safety or efficacy.