FBI Raid Leads to Several Medicare and Medicaid Prescription Fraud Charges

As part of an ongoing investigation by the Federal Bureau of Investigations, several of Michigan’s pharmacists have been charged with Medicare and Medicaid Prescription Fraud.  The allegations include claims that at least one scheme lead to the defrauding of the Federal Government of more than five million dollars. Further, that fraudulent claims were submitted to Medicare, Medicaid and Blue Cross via the service dialdrugspharmacy.com. Medications fraudulently prescribed included Clozapine and Alprazolam. According to the complaint, some of these prescriptions were written for dead people.

According to Title 18 of the United States Code, health care fraud consists of the knowing implementation (or attempted implementation) of a scheme intended to defraud a health care program using false pretenses. A pharmacist can violate this law even if they are ignorant of the law itself, or if they only have the “general intent” to violate the law. This is because health care fraud under this section is not a specific intent crime. The law defines “fraud” as being the intentional deception or misrepresentation of facts which lead to the receiving of an unauthorized benefit. But here again the intent need only be general and not specific. According to the Michigan prescription fraud lawyers at the Barone Defense Firm, this can lead to unfair prosecution of pharmacists who never specifically intended to violate the law.

There are many kinds of prescription fraud.  Once type of prescription fraud involves a scheme whereby a prescription is set on “auto-refill” and then billed as scheduled when the patient never actually ordered or wanted the medication. These prescriptions are never picked up but the pharmacy non-the-less bills Medicare. This same medication can be “re-sold” many times over, thereby increasing the size of the auto-refill fraud. Another version of this kind of fraud involves giving the undelivered pills to patients, staff or medical sales reps for redistribution. This is most common with Opioid drugs that have significant street value.

Similarly, there is a type of prescription fraud which involves billing for an expensive medication but providing the patient with a different, less expensive drug. Medicare or Medicaid pays the pharmacists for the more expensive drug, thereby creating criminal liability.

A type of prescription fraud that might be less obvious is when a pharmacist gives incentives to a patient to switch their Medicare or Medicaid prescriptions to them. This is the kind of fraud that can be committed without the pharmacists necessarily knowing they’ve committed fraud. This is why the general intent provision mentioned above is so important.  Another such kickback scheme, albeit on a larger scale, is when drug companies “bribe” (give anything of value) to pharmacies and pharmacists for transferring their patients to a drug manufactured by the pharmaceutical company.

There is also fraud that can arise out of a failure to properly keep prescription records. Smaller pharmacies and pharmacists are particularly prone to this kind of prescription fraud because they often don’t keep records with the same integrity as the larger pharmacies. Fraud Examiners sometimes call this “no supporting documentation fraud.”

The FBI’s investigation in Michigan includes allegations of many of the types of Medicare/Medicaid prescription fraud described above. If you have been charged with prescription fraud in Michigan, have one of the skilled prescription fraud lawyers at the Barone Defense review your case, develop a defense strategy, and help you protect your livelihood, your reputation and your family.

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