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Thursday, October 18, 2018
Department of Justice U.S. Attorney’s Office Eastern District of Arkansas FOR IMMEDIATE RELEASE Thursday, October 18, 2018 Four Plead Guilty in Multi-Million Dollar TRICARE Scheme
Department of Justice
U.S. Attorney’s Office
Eastern District of Arkansas
Four Plead Guilty in Multi-Million Dollar TRICARE Scheme
LITTLE ROCK—Cody Hiland, United States Attorney for the Eastern District of Arkansas, Diane Upchurch, Special Agent in Charge of the Little Rock Field Office of the FBI, and Artie DeLaneuville, Acting Special Agent in Charge of the Dallas Regional Office of the U.S. Department of Health and Human Services, Office of the Inspector General (HHS-OIG), announced today the guilty pleas of Brad Duke, 43, of Little Rock, Charlotte Leija, 38, of Conway, Michael "Chance" Beeman, 48, of Maumelle, and Michael Sean Brady, 50, of Little Rock, to conspiring to violate the Anti-Kickback Statute. Duke pleaded guilty on October 3, while Leija, Beeman, and Brady all pleaded guilty on Wednesday before Chief United States District Judge Brian S. Miller, who will sentence the group at a later date.
As has been widely reported, TRICARE (our military’s health insurer) paid nearly $2 billion for compound prescription drugs in 2015—an eighteen-fold increase over previous years—prompting investigations around the country.
Duke, who worked as a medical sales representative in Little Rock, promoted prescription pain cream, scar cream, and supplements for a Mississippi-based compounding pharmacy, earning a share of whatever the pharmacy was paid on prescriptions issued by affiliated doctors. After learning TRICARE would pay tens of thousands of dollars per month per patient for compounded drugs, Duke focused upon generating prescriptions for those with TRICARE insurance.
Duke paid patient recruiters, including Beeman and Brady, to find TRICARE beneficiaries to receive prescriptions, telling them a doctor would sign the prescriptions without consulting patients. Patient recruiters forwarded beneficiary insurance information to Duke, which he then routed to local medical assistant Charlotte Leija, whom Duke paid to file the prescriptions under the name of the doctor for whom she worked.
In less than one year, the scheme generated over $10 million in compound prescriptions for over 100 TRICARE beneficiaries hailing from as far west as Chula Vista, Calif., to as far east as Foxborough, Mass. Duke paid patient recruiters more than $2 million to find the beneficiaries and over $250,000 to Leija to issue the prescriptions.
“Duke’s scheme resulted in millions of dollars of fraud and waste to our taxpaying citizens,” U.S. Attorney Hiland said. “This office is determined to root out the criminal fraud in our nation’s health care programs.”
Under the terms of their plea agreements, Duke, Leija, Beeman, and Brady each face up to five years in federal prison and together will forfeit nearly $1.9 million in illicit proceeds. More charges involving additional defendants are expected.
“These pleas are a reflection of Duke’s greed to promote prescriptions for compounded drugs in a kickback scheme for his own profit,” stated SAC Upchurch. “The United States Attorney’s Office, HHS-OIG, and the FBI will aggressively pursue providers who violate the law for personal gain.”
“Any time fraudulent claims are submitted for payment, the nation’s health insurance programs suffer,” said Acting SAC DeLaneuville. “Along with our law enforcement partners, this office will continue the important mission of protecting the financial integrity of our nation’s health care systems, and bringing to justice those individuals who deliberately manipulate those systems to obtain federal dollars to which they are not entitled, especially funds designated for providing vital health care services to our military veterans.”
If you or someone you know was approached about getting compounded prescription drugs, please contact usaare.TRICAREtips@usdoj.gov.(link sends e-mail)
The crime of conspiring to violate the Anti-Kickback Statute, 42 U.S.C. § 1320a- 7b(b), is punishable by up to five years in prison, a fine of not more than $250,000, and up to three years of supervised release. This case was investigated by the FBI and HHS- OIG, and prosecuted by Assistant United States Attorney Alexander D. Morgan.
This news release, as well as additional information about the office of the United States Attorney for the Eastern District of Arkansas, is available on-line at
Twitter: @EDARNEWS(link is external)
Topic(s):
Health Care Fraud
Component(s):
4 hours ago · PCCA Compounding
PCCA Formula #7836 – Nasal Spray (PCCA members can access the formula here.)
This formula has been fantastic for numerous patients with pain or depression. It is a simple, effective way to deliver medications, too.
This formula has been fantastic for numerous patients with pain or depression. It is a simple, effective way to deliver medications, too.
...
In another case, we worked with a physician who prescribed ketamine nasal spray for a 28-year-old man who has suffered from severe depression for a long time. He lives with his parents, who are still his caregivers. He started the ketamine nasal spray, and his life has changed! His father initially picked up his prescriptions, but now he comes in and picks them up.
9 minutes ago · Authorities say Duke, a medical sales representative working for a Mississippi pharmacy, paid recruiters like Brady and Beeman to find beneficiaries of Tricare, the military's insurance program. Tricare pays pharmacies thousands of dollars per patient for compounded drugs.
21 minutes ago · Authorities say Duke, a medical sales representative working for a Mississippi pharmacy, paid recruiters like Brady and Beeman to find beneficiaries of Tricare, the military's insurance program. Tricare pays pharmacies thousands of dollars per patient for compounded drugs
Wednesday, October 17, 2018
The Law of Compounding Medications And Drugs: FDA Warns Two Firms about Monensin Contamination i...
The Law of Compounding Medications And Drugs: FDA Warns Two Firms about Monensin Contamination i...: The U.S. Food and Drug Administration has issued warning letters to two feed mills, Gilman Co-Op Creamery in Gilman, Minnesota, and Fa...
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