NBI MEDIC Update on Fraud Trends and SuccessesNBI MEDIC Update on Fraud Trends and Successes

Martina GillyBenefit Integrity ManagerAugust 14, 2013

AgendaAgenda

• Trends• Successes

TRENDSTRENDS

TrendsTrends

• Identity Theft/Telemarketing– Person with foreign accent requests bank account and

personal information– Caller offering free diabetic supplies requests bank account

and personal information– Plan call center redirected calls– 849-935-5808 (originates in Dominican Republic)– Medical Alert System – Members’ addresses changed to 720 NW 2nd Ave., Ft.

Lauderdale, Florida 33311

Trends (cont.)Trends (cont.)

• Part C– Upcoding of Evaluation and Management (E&M) codes– Billing high-dollar J codes (HIV and cancer medications)– Home health

• Beneficiaries are not home bound and do not qualify for home health services• Use of unlicensed personnel as Registered Nurses or Certified Nurse Assistants• No order on file from a physician for home health services• Doctor did not order home health services• Doctor ordering services that are not medically necessary or excessive services• Billing for services not provided• Upcoding of services• Kickbacks to beneficiaries, recruiters, and doctors for referrals• Collusion between home health agencies, doctors, and pharmacists

Trends (cont.)Trends (cont.)

• Part D– Billing high-dollar medications not purchased,

prescribed, or dispensed– Medication shortages– Creation of false medication invoices– Over-prescribing– Drug-seeking beneficiaries– Compound pharmacies

SUCCESSESPart C

SUCCESSESPart C

Gainesboro Ultimate Med Service Corp.Gainesboro, TN

Gainesboro Ultimate Med Service Corp.Gainesboro, TN

• Case referred by WellPoint alleging that Gainesboro was committing infusion therapy fraud and billing for services not rendered.

• Gainesboro incorporated in Tennessee, and Yannier Capote Gonzalez listed as President. Address given as 179 Buck Branch Lane, Gainesboro, Tennessee.

• 179 Buck Branch Lane was a dilapidated red barn in a rural area. Beneficiaries, who resided in Miami, were shown with addresses in Gainesboro. The rendering physician had his identity stolen. Several hundred thousand dollars in claims billed to WellPoint and CIGNA.

OutcomeOutcome

• Expedited investigation by Department of Health and Human Services (HHS)/Office of Inspector General (OIG) led to Gonzalez being arrested in a bank in Miami, Florida, and charged with health care fraud.

• On November 5, 2012, Gonzalez was convicted in a jury trial of five counts of health care fraud, two counts of aggravated identity theft, and one count of money laundering.

• On February 15, 2013, Gonzalez was sentenced in U.S. District Court, Middle District of Tennessee, to 5 years and 7 months incarceration, 4 years supervised release, forfeiture of $19,295 in real or personal property, and a special assessment of $800.

Leon Medical & Therapy ServicesMiami, Florida

Leon Medical & Therapy ServicesMiami, Florida

• Matter initiated from NBI MEDIC proactive analysis in March 2011. The pharmacy appeared to be billing in excess for medications identified as Solaraze and/or Dovonex and may have submitted claims for services not rendered.

• The NBI MEDIC shared the scheme during a Task Force Meeting hosted by Blue Cross and Blue Shield of Florida (BCBSF).

• The NBI MEDIC requested BCBSF conduct a proactive analysis. BCBSF representatives found a scheme involving changing J codes in order to receive higher reimbursement. Onsite visit determined Leon Medical did not have sufficient inventory to support billing.

• No patients or medical staff were found during the onsite. Leon had been paid $628,000; of that $591,731 was for procedure J2353, which they did not have. Medicare Part C exposure was approximately $627,431.

• In July 2011 the NBI MEDIC made a referral to HHS/OIG in Miami.

OutcomeOutcome

• On May 1, 2012, 59 South Florida residents were charged as part of a nationwide coordinated takedown by the Medicare Fraud Strike Force. Included in the takedown/indictment were three members of Leon Medical. Maggie Leon, Yuderkis Pena Garcia, and Eduardo Vilau were charged with conspiracy to commit health care fraud.

• On September 28 and October 26, 2012, Vilau and Garcia entered guilty pleas to one count of health care fraud. They are both currently serving prison terms. Garcia was sentenced to 14 months incarceration and 18 months home detention and ordered to perform 1,400 hours of community service. Each was ordered to pay restitution of $339,643.

• On December 5, 2012, Leon, owner of Leon Medical, went to trial and was found guilty and convicted of one count of conspiracy to commit health care fraud and eight counts of health care fraud. On February 14, 2013, Leon was sentenced to 100 months for the 9 counts. Leon was ordered to pay restitution of $2,447,715.

•

Visiting Doctors for America & Compassionate Care Doctors

Detroit, Michigan

Visiting Doctors for America & Compassionate Care Doctors

Detroit, Michigan

• NBI MEDIC received numerous complaints and submitted 11 referrals and/or Immediate Advisements to HHS/OIG.

• Complaints ranged from upcoding E&M codes, billing for services without supporting documents, prescribing high volumes of controlled substances, and beneficiaries being billed for medications not received and prescribed by unknown doctors.

• On March 20, 2013, 44 individuals were indicted that were associated with Visiting Doctors for America, Compassionate Care Doctors, and various pharmacies (Sav-Max, Pickens Medical, and Andy’s Motown).

OutcomeOutcome

• The medical practices created prescriptions to be filled at pharmacies, including cooperating pharmacies. With cooperating pharmacists, patients, doctors, and recruiters, numerous controlled substances were illegally prescribed and distributed. Doctors generated prescriptions on blank prescription pads. It was estimated that the street value of the controlled substances and Medicare billings was $44 million.

• Of those indicted, the NBI MEDIC investigated Dr. Adelfo Pamatmat, Dr. Paul Kelly, Dr. Ravi Iyer, Dr. Muhammad Ahmed, Dr. Malik Dababneh, PA Tim Spencer, Ahab Elmadhoun, Waleed Yaghmour, and Tiffany Walker.

Ahab Elmadhoun, Waleed Yaghmour, Paul Kelly, MD & Ravi Iyer, MD

Detroit, Michigan

Ahab Elmadhoun, Waleed Yaghmour, Paul Kelly, MD & Ravi Iyer, MD

Detroit, Michigan

• Elmadhoun and Yaghmour were associated with the Sav-Max Pharmacy collective, including Sav-Max Pharmacy (as resident agents) and Sav-Max Glory Pharmacy.

• Some of the pharmacists would bill insurers, including Medicare, Medicaid, and private insurers, for dispensing the medications, despite the fact that the medications were medically unnecessary and, in many cases, never provided. Other times, the pharmacists accepted cash from the recruiters for filling and dispensing medications.

Ahab Elmadhoun, Waleed Yaghmour, Paul Kelly, MD & Ravi Iyer, MD

Detroit, Michigan (cont.)

Ahab Elmadhoun, Waleed Yaghmour, Paul Kelly, MD & Ravi Iyer, MD

Detroit, Michigan (cont.)

• Owners of home health agencies would provide kickbacks, bribes, and other illegal benefits to physicians to induce them to write prescriptions for controlled substances for patients with Medicare, Medicaid, or private insurance.

• Prescriptions were presented to Sav-Max Pharmacy and Sav-Mart Pharmacy, among others.

• On March 20, 2013, a federal indictment was unsealed charging 44 defendants, including the above-listed individuals, with the unlawful acquiring and distribution of controlled substances, fraudulent health care billings, money laundering, unlawful bribes and kickbacks, and the illegal possession of firearms.

SUCCESSESPart D

SUCCESSESPart D

Blanca Castro Trump Wholesale Pharmaceutical

Blanca Castro Trump Wholesale Pharmaceutical

• Allegations of the creation of false invoices were brought to the attention of the NBI MEDIC during November 2011 Part D Fraud Work Group meeting by OptumRx and CVS.

• Trump Wholesale Pharmaceutical created and sold false invoices to approximately 45 Miami pharmacies to conceal submission of false and fraudulent claims to various pharmacy benefit managers (PBMs) through those pharmacies.

• On December 20, 2012, Castro was indicted for creating fraudulent prescription drug invoices for the purpose of selling the invoices to two pharmacies (Your Neighbor and Millennium Rx) to conceal the submission of false prescription claims to Medicare Part D.

• Castro pled guilty on March 15, 2013.• On May 29, 2013, Castro was sentenced to 48 months of imprisonment

and 3 years of probation.

Your Neighbor PharmacyMiami, Florida

Your Neighbor PharmacyMiami, Florida

• NBI MEDIC case predicated on CVS Caremark referral. • CVS Caremark conducted an investigative audit after

following members from Universal Scripts, a previously terminated pharmacy.

• Audit disclosed the pharmacy was short on 36 of the 50 medications reviewed. The pharmacy attempted to provide invoices from Trump Wholesale Pharmaceutical. However, those invoices were not accepted as the pharmacy was unable to provide pedigrees to validate the purchases.

• All referral information sent to HHS/OIG through Immediate Advisement.

OutcomeOutcome

• On June 14, 2012, Elisabeth Martinez, the Registered Agent and Manager of Your Neighbor Pharmacy, was indicted on conspiracy to commit health care fraud and health care fraud. Martinez remained a fugitive until December 6, 2012, at which time she was arrested at the airport.

• On February 6, 2013, Martinez pled guilty. • On April 22, 2013, Martinez was sentenced to 27 months

imprisonment, followed by 3 years supervised release. She was also ordered to pay $2,400,000 in restitution.

Millennium RXMiami, FloridaMillennium RXMiami, Florida

• Investigation initiated from several complaints. A Medco analysis identified a large volume of high-dollar medication claims. Express Scripts and OptumRx identified inventory shortages. An NBI MEDIC compromised ID report proactive analysis identified Millennium RX as an outlier.

• The NBI MEDIC also had a pending investigation into Universal Scripts. Both pharmacies had been referred to HHS/OIG in Miami.

• Millennium RX was owned and operated by Keilan Fife. The owner for Universal Scripts was listed as Carlos Rodriguez. It was determined that Fife is the wife of Rodriguez.

• Fife, through Millennium, submitted prescriptions to Medicare that were never provided to Medicare patients. The patients were paid kickbacks to use their Medicare numbers. Millennium was paid approximately $1.3 million from Medicare.

• On June 14, 2012, Fife was indicted in the Southern District of Florida and charged with 10 counts of health care fraud.

OutcomeOutcome

• On November 27, 2012, OIG agents arrested Fife and her husband, Carlos Rodriguez, after they arrived at Miami International Airport. Fife was arrested pursuant to the indictment on Millennium Rx. Rodriguez was arrested based on an indictment for health care fraud as the owner and operator of Universal Scripts, Inc.

• On January 22, 2013, Fife entered a guilty plea to 3 counts of the 10-count indictment, all relating to health care fraud violations.

• On April 3, 2013, Fife was sentenced to 30 months to begin incarceration on June 17, 2013.

• Fife was ordered to pay restitution of $845,000.

Ambulatory Professional Medical Equipment, Inc. (APME)

Hialeah, Florida

Ambulatory Professional Medical Equipment, Inc. (APME)

Hialeah, Florida

• Case predicated on a complaint from Express Scripts/Medco.• Medco found the pharmacy had insufficient inventory to

support the medications billed and reportedly dispensed. The pharmacy provided many medication purchase invoices from Trump Wholesale Pharmaceutical.

• The NBI MEDIC conducted a medication invoice reconciliation audit indicating a shortage of $1,008,695.

OutcomeOutcome

• On May 15, 2013, APME President Nelson Rodriguez and Vice-President Enrique Galvez were arrested.

• On May 22, 2013, both were indicted in the Southern District of Florida and charged with conspiracy to commit health care fraud, health care fraud, and payment of kickbacks in connection with a federal health care program.

• The indictment alleged that Rodriguez and Galvez paid a recruiter for beneficiary names and information. The recruiter paid beneficiaries for the use of their names and information. The indictment also alleged that Rodriguez and Galvez submitted false prescription claims representing prescription drugs to be medically necessary, prescribed by a doctor, and dispensed to beneficiaries.

Greenwall PharmacyMiami, Florida

Greenwall PharmacyMiami, Florida

• Multiple complaints received regarding Greenwall Pharmacy.• Investigative audits conducted by OptumRx and CVS Caremark on behalf

of several plan sponsors identified medication shortages when compared to medication manufacturer invoices. The PBMs also noted that Greenwall Pharmacy provided them with suspicious and potentially fraudulent invoices from Trump Wholesale Pharmaceutical.

• NBI MEDIC performed an invoice audit, finding a loss of $6,807,562 to Medicare Part D.

• On May 31, 2013, Jose Tiejeireo, owner of Greenwall Pharmacy, pled guilty to conspiracy to commit health care fraud. The information charged Tiejeireo with paying recruiters to refer beneficiaries to his pharmacy, purchasing false invoices from Trump, and submitting fraudulent claims to PBMs to conceal that Greenwall Pharmacy did not purchase or dispense the medications billed to Part D.

Speed Pharmacy, Inc.Pembroke Pines, Florida

Speed Pharmacy, Inc.Pembroke Pines, Florida

• NBI MEDIC case predicated on OptumRx audit, which disclosed invalid claims, and confirmation from two physicians who denied prescribing medications.

• Prescription Solutions, Medco, CVS Caremark, and Humana each conducted a medication inventory audit, which identified an insufficient inventory to support the medications billed and reportedly dispensed by the pharmacy.

• The NBI MEDIC completed an invoice audit review based on pharmacy invoices from OptumRx, CVS Caremark, Medco, and Humana. The audit revealed a shortage on 46 of 50 drugs reviewed for December 1, 2009–December 31, 2010, which equaled a loss of $610,065 to Part D.

Speed Pharmacy, Inc.(Cont.)

Speed Pharmacy, Inc.(Cont.)

• The owner, Guido Halayn De La Torre, opened an account with Trump Wholesale Pharmaceutical, owned by Blanca Castro. Castro sold De La Torre false invoices, which falsely and fraudulently represented that Speed Pharmacy had purchased prescription drugs from Trump. De La Torre then submitted the false invoices to PBMs to conceal that Speed Pharmacy did not purchase or dispense many of the prescription drugs billed under Medicare Part D.

OutcomeOutcome

• On November 8, 2012, an indictment was returned against De La Torre charging him with submitting false claims for commonly abused high-dollar medications such as Lidoderm, Zyprexa, Singulair, and Seroquel. The indictment indicated payments to Speed Pharmacy by plan sponsors through their PBMs totaled $2,411,944.

• On March 15, 2013, a 13-count superseding indictment was returned against De La Torre charging him with conspiracy to commit health care fraud and health care fraud.

• On May 6, 2013, after a six-day trial, a federal jury returned a guilty verdict against De La Torre on all counts. Sentencing is scheduled for October 2, 2013.

Atlantis Pharmacy, Inc.Miami, Florida

Atlantis Pharmacy, Inc.Miami, Florida

• NBI MEDIC case predicated on OptumRx audit, which disclosed a shortage based on an invoice reconciliation performed for all drug purchase invoices against pharmacy billing records.

• According to invoice purchases, there was insufficient inventory to fulfill prescriptions to members. OptumRx’s initial audit findings disclosed $98,999 in discrepant Medicare Part D Prescription Drug Event (PDE) records.

• Through a proactive data analysis, the NBI MEDIC identified that the pharmacy submitted PDE records under the credentials of physicians whose Florida licenses were no longer valid. Physician attestations identified approximately $4,782 in questionable Medicare Part D PDE records.

Atlantis Pharmacy, Inc.(Cont.)

Atlantis Pharmacy, Inc.(Cont.)

• Carlos Diaz recruited Medicare beneficiaries and paid them kickbacks and bribes (typically $100) for allowing Diaz and his co-conspirators to use the beneficiaries’ personal and prescription information to file fraudulent PDE records under Medicare Part D.

• Guido Halayn De La Torre, the sole officer, director, and registered agent of Atlantis Pharmacy, purchased false invoices from Trump Wholesale Pharmaceutical, which falsely and fraudulently represented that Atlantis Pharmacy had purchased prescription drugs from Trump.

Atlantis Pharmacy, Inc.(Cont.)

Atlantis Pharmacy, Inc.(Cont.)

• De La Torre’s father, Guido Juan De La Torre, submitted false and fraudulent invoices to Medicare and Medicare drug plan sponsors to conceal that Atlantis Pharmacy did not purchase or dispense many of the prescription drugs that the pharmacy billed under Medicare Part D. Medicare prescription drug plan sponsors made overpayments (funded by Medicare) to Atlantis Pharmacy’s corporate bank accounts of at least $1,608,231.

Atlantis Pharmacy, Inc.(Cont.)

Atlantis Pharmacy, Inc.(Cont.)

• On April 18, 2013, a grand jury indicted Guido Juan De La Torre, Guido Halayn De La Torre, and Carlos Diaz on Count 1 - Conspiracy to Commit Health Care Fraud (18 U.S.C. § 1349) and Counts 2–6 - Health Care Fraud (18 U.S.C. § 1347). Additionally, Diaz was indicted on Count 11 - Conspiracy to Pay Health Care Kickbacks (18 U.S.C. § 347).

OutcomeOutcome

• On April 23, 2013, the De La Torres and Diaz were arrested by HHS/OIG Special Agents.

• On July 2, 2013, the De La Torres entered guilty pleas to Count 1 of the indictment. Guido Halayn De La Torre (son) was remanded into custody pending the imposition of his sentence, scheduled for September 5, 2013. Guido Juan De La Torre (father) was permitted to remain free until the same sentencing date.

SAR PharmacyMiami, FloridaSAR PharmacyMiami, Florida

• Investigation was initiated in March 2012 based on complaints from OptumRx and CVS regarding inventory shortages during audits.

• An invoice review was completed on SAR Pharmacy that revealed a shortage on 49 of 51 drugs reviewed and an approximate dollar loss of $947,767.

OutcomeOutcome

• Yoeli Salgueiro, SAR Pharmacy’s officer, director, and registered agent, and Eddy Alonso, co-conspirator, were indicted on September 6, 2012.

• On January 10, 2013, Salgueiro was sentenced to probation for one year. Alonso was sentenced to imprisonment for 18 months followed by supervised release for 2 years. Both Salgueiro and Alonso were ordered to pay restitution of $947,966.

Y & Y PharmacyMiami, Florida

Y & Y PharmacyMiami, Florida

• The NBI MEDIC’s investigation disclosed that Y&Y Pharmacy was asking Medicare beneficiaries to sell their prescriptions for cash and then submitting the false claims to the patients’ health insurance plans.

• The drugs that were not provided to patients were recycled to secondary wholesalers outside of Florida.

• Additional allegations included invoice shortages during audits conducted by various PBMs.

OutcomeOutcome

• The owners of Y&Y Pharmacy, Liset Curiel-Fages and Jose Manuel Curiel, were indicted and charged with conspiracy to commit health care fraud, health care fraud, and payment of kickbacks in connection with a federal health program.

• On January 23, 2013, Curiel-Fages pled guilty. She was sentenced to 3 years probation and ordered to pay $6,466 in restitution.

• On January 24, 2013, Curiel pled guilty. He was sentenced to six months of imprisonment followed by three years of supervised release, which includes six months of participation in the Home Electronic Monitoring Program. He was also ordered to pay $110,000 in restitution.

• NBI MEDIC case predicated on several referrals. – CVS Caremark conducted an investigative audit after P & Y

Pharmacy was identified for high trending of commonly abused medications. An invoice review disclosed the pharmacy was short for 16 of 50 medications reviewed.

– Beneficiary received empty bottle.– Anonymous caller alleged P & Y Pharmacy bought

prescriptions from patients, who received cash on the spot. The medications were then sent to Cuba.

P & Y PharmacyMiami, Florida

P & Y PharmacyMiami, Florida

• Immediate Advisement sent to HHS/OIG, which included all referral information.• On October 4, 2012, as part of a nationwide takedown by Medicare Fraud Strike

Force in seven cities, Yanella Falcon and Pedro Guzman, the owners and operators of P & Y Pharmacy, were indicted with conspiracy to commit health care fraud, health care fraud, and payment of kickbacks in connection with a federal health care program. The defendants paid doctors in return for prescriptions, which were used to submit false claims to Medicare. As a result of those claims, Medicare paid P & Y Pharmacy $412,681. In total, the pharmacy was paid $1,907,985 by plan sponsors, the government, beneficiaries, and other parties.

• On December 20, 2012, both owners pled guilty to one count of conspiracy to commit health care fraud. On April 16, 2013, they were each sentenced to 37 months in prison and 3 years probation and ordered to pay restitution of $1,255,045.

OutcomeOutcome

24 Hour and Universal Scripts PharmacyMiami, Florida

24 Hour and Universal Scripts PharmacyMiami, Florida

• In November 2010, NBI MEDIC initiated an investigation based on a complaint from Express Scripts in St. Louis, MO. The allegation advised that 24 Hour Community Pharmacy submitted claims for payment for drugs that were not purchased from a valid supplier.

• From September 2010 to June 2012, NBI MEDIC received five separate complaints regarding Universal Scripts Pharmacy. Information from a CVS Caremark audit found invoice shortages for 32 of 40 medications.

• In June 2011, NBI MEDIC sent a referral for 24 Hour Pharmacy to HHS/OIG. Invoice audit showed a shortage of $915,000 from April 2009 to July 2010.

• Investigation on Universal Scripts disclosed from January 2006 to August 2011, the pharmacy had billed $8,449,805 to Medicare Part D and plans.

• In May 2011 a referral for Universal Scripts was sent to HHS/OIG in Miami, along with four subsequent Immediate Advisements.

• Representatives of 24 Hour Pharmacy were ultimately indicted in Miami. In preparing the indictment it was determined the same principals in 24 Hour Pharmacy were also involved in Universal Scripts Pharmacy.

OutcomeOutcome

• Subsequent to the 24 Hour Pharmacy indictment, a superseding indictment was returned in June 2012 to include Universal Scripts, charging the same four defendants who were operating both pharmacies with various health care fraud violations.

• The indictment alleged Medicare Part D paid Universal Scripts approximately $7,039,106 in fraudulent claims. The four defendants charged were Ramon Llanes, Elitam Cristina Llanes, Carlos Rodriguez, and Lazaro Raul Betancourt.

• All defendants have been convicted and are currently serving prison sentences ranging from 12 to 57 months. Restitution of $5.3 million has been ordered by the court.

Jose Morales/Pharmovisa d/b/a Morales Pharmacy

Miami, Florida

Jose Morales/Pharmovisa d/b/a Morales Pharmacy

Miami, Florida

• Case predicated upon a data proactive analysis of anti-psychotic medications of which the pharmacy was an outlier and referred to HHS/OIG.

• Morales was indicted on September 4, 2012, and charged with paying kickbacks to assisted living facility owners for referring beneficiaries so that their Medicare numbers could be used on Part D claims; concealing submission of false and fraudulent claims to Medicare; re-using and re-selling prescription medications filled at the Morales Pharmacies without reversing the claims submitted to Part D; and paying kickbacks to medical doctors for providing prescriptions to be filled at Morales Pharmacies.

OutcomeOutcome

• Morales pled guilty on December 7, 2012, to a superseding indictment for his role in the fraud scheme exceeding $20 million.

• On February 26, 2013, he was sentenced to 14 years in prison and 3 years probation and fined $100,000.

• On April 24, 2013, Morales was ordered to pay restitution in the amount of $15,026,810.

Sterling PharmacyMiami, Florida

Sterling PharmacyMiami, Florida

• Case predicated upon two complaints from WellPoint alleging a possible compromised beneficiary and medication shortages based on an audit of the pharmacy.

• The NBI MEDIC performed a medication invoice review based on invoices provided by CVS Caremark. The audit indicated a shortage on 49 of 50 medications reviewed. The total dollar amount of the shortage was $1,561,034.

• On September 18, 2012, the Vice-President, Alina Alvarez, was indicted and charged with submitting false prescription claims and paying kickbacks to a doctor totaling $1,800 for prescriptions in order to submit fraudulent claims.

OutcomeOutcome

• On November 2, 2012, Alvarez pled guilty to committing health care fraud.

• On January 11, 2013, Alvarez was sentenced to 30 months incarceration and ordered to pay restitution of $1,561,034.

Delmer Parrish (Pharmacist) and Patricia ParrishNaples, Florida

Delmer Parrish (Pharmacist) and Patricia ParrishNaples, Florida

• Investigation initiated by NBI MEDIC in June 2011 after former employees reported that Delmer Parrish, owner of several pharmacies in Naples, Florida, was involved in Medicare Part D fraud by fraudulently submitting claims for payment for benefits, items, and services that were not authorized and not rendered, mainly drug prescriptions. Investigation referred to HHS/OIG in Tampa, Florida.

• On January 18, 2013, HHS/OIG executed a search warrant at two pharmacies owned by Delmer Parrish, Sunshine Solutions Pharmacy and Sunshine Pharmacy in Naples.

• The NBI MEDIC performed a medication invoice reconciliation audit for February 2009 through July 2012 for HHS/OIG. The audit found that $347,468 had been paid by Medicare Part D for medications that were never purchased, prescribed, or dispensed.

OutcomeOutcome

• On May 15, 2013, Delmer Parrish and his mother, Patricia Parrish, were indicted in the Middle District of Florida at Ft. Myers and charged with one count of conspiracy to commit health care fraud.

• The indictment alleged that the pharmacies had lost contracts with hospices and assisted living facilities, resulting in loss of cash flow. Sunshine Pharmacy submitted the false prescription claims in order to obtain funds to keep the pharmacy in operation. As a result, there were insufficient medications purchased when compared to the Medicare billed amounts.

Dr. Norman WertherWillow Grove, PA

Dr. Norman WertherWillow Grove, PA

• Case predicated upon information from Medco alleging Dr. Werther was dispensing a high volume of controlled substances.

• Drug traffickers recruited pseudo-patients and transported them to Dr. Werther’s office for fake medical exams. Each patient paid $150 cash for the office visit. Patients were driven to Northeast Pharmacy to fill the prescriptions. The drugs were then turned over to the recruiters for sale to numerous drug dealers.

• Dr. Werther knowingly dispensed approximately 150 pills containing 30 mg of oxycodone and 30 pills containing 15 mg of oxycodone to a person for no legitimate medical purpose, resulting in that person’s death.

OutcomeOutcome

• Dr. Werther and over 60 other defendants were indicted in a 498-count indictment and charged with illegal distribution of controlled substances, possession with intent to distribute, conspiracy, money laundering, and health care fraud.

• For the period of February 2009 through August 2011, 700,000 pills containing oxycodone were distributed by the drug ring.

• Following a trial, on June 11, 2013, Dr. Werther was found guilty on 300 counts.

Babubhai Patel/Caring Pharmacy, et al.Detroit, Michigan

Babubhai Patel/Caring Pharmacy, et al.Detroit, Michigan

• On August 2, 2011, an indictment returned by a federal grand jury in Detroit charged 26 individuals for their participation in a multi-million-dollar health care fraud and drug distribution scheme to facilitate the submission of false claims to Medicare, Medicaid, and private insurers.

• The 34-count indictment alleged that pharmacist Babubhai Patel was the owner and controller of 26 pharmacies and concealed his ownership and control over many of the Patel pharmacies through the use of straw owners.

OutcomeOutcome

• On February 1, 2013, Patel was sentenced to 17 years in prison following his conviction in late summer 2012. Patel was ordered to pay nearly $20 million in restitution.

• On March 20, 2013, a second round of indictments charged 13 additional people with health care fraud, including Richard Utarnachitt, MD, and Carl Fowler, MD.

• Patel pharmacies billed the Medicare/Medicaid programs approximately $57 million for medications purportedly provided to beneficiaries since January 2006.

• NBI MEDIC provided assistance in identifying and linking pharmacies and pharmacists and obtaining remittance claim information to aid the investigation.

Dr. Baljinder PannuDetroit, Michigan

Dr. Baljinder PannuDetroit, Michigan

• NBI MEDIC received four complaints (Medco, CVS Caremark, anonymous, and Medicare beneficiary) alleging kickbacks to a patient and beneficiary doctor shopping in which Dr. Pannu allegedly provided the controlled substances.

• Dr. Pannu was a pain management physician operating the Pain Management Clinic in Detroit.

• On January 23, 2013, Dr. Pannu was sentenced for making payments to recruiters to induce them to refer Medicare beneficiaries to his clinic for medical services.

• He received 18 months incarceration, 24 months supervised probation, $560,000 in restitution to Medicare, and a $25,000 fine payable to the court.

Contact InformationContact Information

• NBI MEDIC Hotline – (800) 7SafeRx

• Martina Gilly – gillym@healthintegrity.org

QuestionsQuestions