2021 Pharmacy Enforcement Actions in Full Swing

By: Michael Silverman

The new year has brought with it no lull in pharmacy fraud crackdowns and enforcement actions, with allegations related to over one billion dollars in false claims.

Here’s a breakdown of the latest:

Mississippi Man Sentenced to 18 Years in Prison and $287,659,569 in Restitution

This individual spearheaded a scheme involving kickbacks to marketers and prescribers to defraud TRICARE and other healthcare programs by submitting claims for unnecessary compounded medications, which also involved routine waiver of patient financial responsibility. Continue reading

Healthcare Marketing Lesson: Compound Pharmacy Kickback Scheme

healthcare marketingBy: Jacqueline Bain

Monty Ray Grow was a defensive back on the Florida Gators’ football team from 1990 until 1993. He contracted to play for the Kansas City Chiefs in 1994 and then for the Jacksonville Jaguars in 1995 and 1996. On February 5, 2018, he was convicted by a federal jury in Miami for his chief role in a massive healthcare marketing scheme designed to defraud Tricare.

Tricare is a health benefit program that provides civilian benefits for U.S Armed Forces military personnel, retirees, their dependents, and some military reservists. Tricare is a Department of Defense Program.

In September 2014, Grow entered into an agreement with a compounding pharmacy in Pompano Beach, Florida, wherein the pharmacy would pay Grow’s marketing company a commission equal to fifty percent (50%) of what the pharmacy netted in Tricare reimbursement from Grow’s referral of Tricare beneficiaries to the pharmacy. (Later on, Grow became an employee of the pharmacy.) Grow then used his commission to offer and pay recruiters to convince Tricare beneficiaries to use this pharmacy. Additionally, Grow offered and paid Tricare beneficiaries themselves to use this pharmacy.Continue reading

Compounding Pharmacies and Alleged Tricare Abuses Back in the Spotlight

compounding pharmacyBy: Jacqueline Bain

On Thursday, February 11, 2016, the United States Attorneys’ Office from the Middle District of Florida announced a $10 million settlement with 4 physicians and 2 pharmacies regarding alleged abuses of Tricare program.  The case against these physicians and pharmacies was prosecuted as part of the United States government’s large-scale effort to combat questionable compounding practices.  Investigations revealed that patients were often prescribed compounded drugs that they never used, and that Tricare paid a mark-up cost of nearly 90% for compounded drugs over and above the pharmacy’s actual costs of making the drug.  Roughly 40% of the claims submitted by the pharmacies in question were written by 4 physicians with an ownership or financial interest in the pharmacies.

Tricare is a federal health care program designed to insure active duty military service members, reservists, members of the National Guard, retirees, survivors and their families.  Tricare outpatient costs have almost doubled in the last 5 years, and compound drugs have accounted for a large portion of that increase. Continue reading

Compounding Pharmacy Shells Out $3.775 Mil to Settle False Claims Suit

bonus calculationA Jacksonville compounding pharmacy has agreed to pay $3.775 million to settle false claims allegations that it defrauded TRICARE. MediMix Specialty Pharmacy billed TRICARE for compounding pain prescriptions that came from an improper referral source. MediMix’s top-prescriber over a period of five years was also married to one of MediMix’s senior vice presidents. MediMix itself was one of TRICARE’s top billers for compounded pain medications.

Since the federal law limiting physician self-referrals, 42 U.S.C. 1395nn (more commonly called the “Stark law”) does not apply to TRICARE, the government proceeded under a law entitled Administrative Remedies for Fraud, Abuse, and Conflict of Interest, 32 C.F.R. 199.9, which is applicable for claims submitted to CHAMPUS and TRICARE. This law is much more broad than the Stark law. While the Stark law contains specific exceptions, this law does not.Continue reading