Health Care Fraud: Joe David May Charged In Kickbacks Generate Expensive Compounded Drug Prescriptions

<h2>Doctor and Sales Rep Charged in &dollar;12 Million Fraud Scheme Targeting Tricare and Extensive Cover Up<&sol;h2>&NewLine;<p><strong>Kickbacks Generate Expensive Compounded Drug Prescriptions<&sol;strong><&sol;p>&NewLine;<div class&equals;"mh-content-ad"><script async src&equals;"https&colon;&sol;&sol;pagead2&period;googlesyndication&period;com&sol;pagead&sol;js&sol;adsbygoogle&period;js&quest;client&equals;ca-pub-9162800720558968"&NewLine; crossorigin&equals;"anonymous"><&sol;script>&NewLine;<ins class&equals;"adsbygoogle"&NewLine; style&equals;"display&colon;block&semi; text-align&colon;center&semi;"&NewLine; data-ad-layout&equals;"in-article"&NewLine; data-ad-format&equals;"fluid"&NewLine; data-ad-client&equals;"ca-pub-9162800720558968"&NewLine; data-ad-slot&equals;"1081854981"><&sol;ins>&NewLine;<script>&NewLine; &lpar;adsbygoogle &equals; window&period;adsbygoogle &vert;&vert; &lbrack;&rsqb;&rpar;&period;push&lpar;&lbrace;&rcub;&rpar;&semi;&NewLine;<&sol;script><&sol;div>&NewLine;<p>LITTLE ROCK—A doctor and a medical sales representative have been charged in a scheme to pay and receive kickbacks to generate expensive prescriptions for compounded drugs&period; TRICARE&comma; the <strong>military’s health insurer&comma; paid over &dollar;12 million for the prescriptions<&sol;strong>&comma; which the indictment alleges were rubber stamped without examining patients or regard to medical necessity&period; The 43-count indictment alleges the scheme also encompassed widespread efforts to obstruct the ensuing investigation&period;<&sol;p>&NewLine;<p>Cody Hiland&comma; U&period;S&period; Attorney for the Eastern District of Arkansas&comma; Diane Upchurch&comma; Special Agent in Charge of the FBI Little Rock Field Office&comma; and Latisha Cleveland&comma; Acting Special Agent in Charge of the Dallas Regional Office of the U&period;S&period; Department of Health and Human Services&comma; Office of the Inspector General&comma; announced the indictment&comma; which was handed down yesterday by a federal grand jury and included charges for<em> conspiracy&comma; wire fraud&comma; mail fraud&comma; Anti-Kickback violations&comma; aggravated identity theft&comma; money laundering&comma; lying to the FBI&comma; falsifying records&comma; and obstruction of justice<&sol;em>&period;<&sol;p>&NewLine;<p>The indictment alleges that recruiters sought TRICARE beneficiaries to receive the drugs&comma; promising to secure their prescriptions &lpar;without any doctor consult&rpar; and&comma; at times&comma; offering them money to sign up&period; Upon receipt of TRICARE beneficiary information from recruiters&comma; the ringleader of the scheme sent pre-filled prescriptions—with drugs to be dispensed&comma; refills authorized&comma; and patient names already listed—to medical professionals who signed without consulting patients or any regard to medical necessity&period; Prescriptions went to a Mississippi pharmacy&comma; which shipped drugs nationwide and billed TRICARE for reimbursement&period;<&sol;p>&NewLine;<p>According to the indictment&comma; local doctor Joe David May&comma; also known as Jay May&comma; of Alexander&comma; rubber stamped pre-filled prescriptions for over 100 beneficiaries for which TRICARE paid &dollar;4&period;5 million&period; May received pre-filled prescriptions from Derek Clifton&comma; also of Alexander&period; The indictment alleges the ringleader paid Clifton to get May to sign the prescriptions despite knowing Clifton shared his payout with May&period; Clifton also had May sign pre-filled prescriptions for beneficiaries solicited by Clifton himself and his own recruiters&period; Clifton received over &dollar;740&comma;000 tied to May’s prescriptions&comma; which he used to buy a car&comma; fund his retirement account&comma; and purchase a home&period;<&sol;p>&NewLine;<p>The indictment alleges Clifton&comma; who previously coached high school basketball&comma; began by recruiting three former players who joined the <a class&equals;"wpil&lowbar;keyword&lowbar;link" href&equals;"https&colon;&sol;&sol;www&period;fraudswatch&period;com&sol;category&sol;military-scammer&sol;amp&sol;" title&equals;"military" data-wpil-keyword-link&equals;"linked" data-wpil-monitor-id&equals;"406">military<&sol;a>&period; Each agreed to receive drugs after being offered money&comma; and one later received &dollar;1&comma;200 cash hidden inside a Stetson cowboy hat&period; Together they received nearly &dollar;500&comma;000 in drugs prescribed by May&period;<&sol;p>&NewLine;<p>According to the indictment&comma; May used a cell phone app to electronically sign batch after batch of pre-filled prescriptions&comma; including signing 8 pre-filled prescriptions within just 3 minutes of receipt&comma; 10 within 5 minutes&comma; and 13 within 13 minutes&period; In the final days before TRICARE reimbursements were expected to plummet&comma; May rubber stamped more than 50 pre-filled prescriptions for which TRICARE paid &dollar;1&period;2 million&period; Many of those beneficiaries were recruited during a meeting at a North Little Rock National Guard facility where attendees were each offered &dollar;1&comma;000 for receiving drugs&period;<&sol;p>&NewLine;<p>The indictment alleges the only TRICARE beneficiary May actually treated before prescribing drugs was a 91-year-old widow suffering from dementia whom May noted neither &OpenCurlyDoubleQuote;report&lbrack;ed&rsqb; any pain” nor appeared to be in pain&period; Nevertheless&comma; he prescribed her &dollar;40&comma;000 in pain cream off the books&comma; failing to log the drugs in her official hospital chart&period;<&sol;p>&NewLine;<p>According to the indictment May <em>received cash kickbacks for signing<&sol;em>&comma; which participants openly discussed&period; When the ringleader joked about being hounded for payouts by texting Clifton &OpenCurlyDoubleQuote;Hashtag for the day&&num;8230&semi; &lbrack;Ringleader&rsqb;&comma; is my check ready&quest; &num; Lol” Clifton replied &OpenCurlyDoubleQuote;Haha&excl; Meeeee toooo Jay already called asking this morning too&&num;8230&semi;even the rich man&period;” Later&comma; Clifton lamented falling TRICARE reimbursement rates by texting the ringleader &OpenCurlyDoubleQuote;&dollar;210 minus half for tax&dollar;105 &lbrack;sic&rsqb; then dr’s cut then patients cut&&num;8230&semi;&period;&period; Yikes&lbrack;&period;&rsqb;” According to the indictment May deposited over &dollar;15&comma;000 in cash in 2015 &lpar;compared to under &dollar;500 in 2014&rpar;&comma; including &dollar;10&comma;000 during the same three-month period at the height of the scheme during which time Clifton withdrew over &dollar;15&comma;000 in cash&period;<&sol;p>&NewLine;<p>According the indictment&comma; following a CBS News exposé and complaints of doctors signing prescriptions &OpenCurlyDoubleQuote;on the down low” without seeing patients&comma; recruiters were instructed to relay prescriber names to beneficiaries so beneficiaries could behave as if they &OpenCurlyDoubleQuote;knew and saw there &lbrack;sic&rsqb; doctor” if they came into contact with the pharmacy&period;<&sol;p>&NewLine;<p>The indictment alleges the ruse continued once federal agents began to investigate&comma; with May and another prescriber both falsely claiming to have consulted patients before signing prescriptions and both producing phony medical records to make it appear patients had been consulted&period; Records produced by May related to beneficiaries never examined and cited made-up injuries and surgeries patients never experienced&period; Similarly&comma; Clifton altered records produced to the Grand Jury to conceal the names of TRICARE beneficiaries who received drugs and withheld hundreds of prescriptions&comma; emails&comma; and other records from the Grand Jury that the FBI would later discover when searching his email account&period;<&sol;p>&NewLine;<p>&OpenCurlyDoubleQuote;Our healthcare system relies upon the integrity of those who practice in the field&period; It is our mission to root out those who would prey upon such vulnerability and prosecute them to the fullest extent of the law&comma;” said U&period;S&period; Attorney Cody Hiland&period; &OpenCurlyDoubleQuote;The assembly line alleged in this case of fraudulent prescriptions fueled by kickbacks was especially concerning because it attacked TRICARE&comma; our military’s health insurer&period; Equally troubling are the allegations of a widespread campaign to throw investigators off the trail by lying to the authorities&comma; falsifying medical records&comma; tampering with evidence&comma; and attempting to hide material from the Grand Jury&period; While such tactics may prolong an investigation&comma; today’s indictment shows that they ultimately succeed only in bringing ever more serious charges upon the accused&period;”<&sol;p>&NewLine;<p>&OpenCurlyDoubleQuote;Unscrupulous medical professionals and fraudsters allegedly stole millions of dollars from the TRICARE program which serves our veterans&comma; military members and their families&comma;” said FBI Special Agent in Charge Diane Upchurch&period; &OpenCurlyDoubleQuote;In an effort to further pervert the course of justice&comma; the defendants allegedly lied&comma; obstructed justice&comma; and falsified records in order to conceal their crimes&period; The deliberate targeting of a healthcare program which solely aids our military troops and their families is appalling&comma; and the additional alleged attempts to cover up their criminal actions show the true nature of those indicted today&period; Alongside our partners at HHS-OIG&comma; we will continue to aggressively investigate fraud within the healthcare industry and we urge anyone with information about suspected healthcare fraud to contact their local FBI Field Office&period;”<&sol;p>&NewLine;<p>&OpenCurlyDoubleQuote;Fraudulently submitting claims to any federally funded health care benefit program equates to robbing all American taxpayers” said HHS-OIG Acting Special Agent in Charge Latisha Cleveland&period; &OpenCurlyDoubleQuote;Working closely with our law enforcement partners&comma; our agents are determined to protect our nation’s health care systems&period; We are committed to ensuring that fraudsters pay for their crimes&comma; especially those that target our military service members and veterans&period;”<&sol;p>&NewLine;<p>A vigilant public is indispensable to rooting out fraud&comma; waste&comma; and abuse within the healthcare industry&period; Please email usaare&period;TRICAREtips&commat;usdoj&period;gov if you or someone you know may have information about the compounded drug scheme targeting TRICARE&period; Please call 1-800-HHS-TIPS &lpar;1-800-447-8477&rpar; or the FBI with any other tips on suspected fraud&comma; waste&comma; or abuse within the healthcare industry&period;<&sol;p>&NewLine;<p>This case is being investigated by the FBI and HHS-OIG&comma; and prosecuted by Assistant United States Attorneys Alexander D&period; Morgan and Stephanie G&period; Mazzanti&period;<&sol;p>&NewLine;<p>An indictment contains only allegations&period; A defendant is presumed innocent unless and until proven guilty&period;<&sol;p>&NewLine;<p>CHARGES AND STATUTORY SENTENCES<&sol;p>&NewLine;<p>Conspiracy is punishable by up to five years’ imprisonment&period; Wire fraud and mail fraud are punishable by up to twenty years’ imprisonment&period; Violating the Anti-Kickback statute is punishable by up to ten years’ imprisonment&period; Aggravated identity theft carries a mandatory two-year prison term&comma; consecutive to any other sentence imposed&period; Money laundering is punishable by up to ten years’ imprisonment&period; Lying to the FBI is punishable by up to five years’ imprisonment&period; Falsification or alteration of records in a federal investigation is punishable by up to twenty years’ imprisonment&period; Obstruction of justice in violation of 18 U&period;S&period;C&period; § 1503&lpar;a&rpar; is punishable by up to ten years’ imprisonment&period; Obstruction of justice in violation of 18 U&period;S&period;C&period; § 1512 &lpar;c&rpar;&lpar;2&rpar; is punishable by up to twenty years’ imprisonment&period;<&sol;p>&NewLine;<p>Each of the proceeding offenses carries a potential fine of up to &dollar;250&comma;000 and up to three years’ supervised release&period;<&sol;p>&NewLine;

Health Care FraudInsurance Fraud