The U.S. Government’s commitment to fighting health care fraud has been increasing in intensity in recent years. Although estimates for the amount of fraudulent health care claims are difficult to gauge, the National Health Care Anti-Fraud Association conservatively estimates around 3 percent of all claims are fraudulent. With health care costs rising, the government is incentivized to continue weeding out providers who try to cut corners and defraud government health insurance programs.
Recently investigators uncovered a pharmacy in West Hollywood, California that they claim was generating millions of dollars in revenue from illegal kickbacks on patient referrals and covering the cost of patients’ copays. According to a press release by the Department of Justice (DOJ), Fusion RX, a compounding pharmacy, was able to generate $14 million for claims on compounded drugs in just under two years. Fusion Rx achieved this with help from two marketers who would provide physicians with prescription pads that were pre-printed to maximize the insurance reimbursement. Fusion RX sold compounded drugs which are alternatives to name brand or generic drugs, which in some instances may be better suited or more convenient for a patient. Compounded drugs tend to be more expensive and usually require higher co-payments.
Investigators found that Fusion Rx would not collect patients’ copayments with regularity and would also cover the cost of the copayments through prepaid cards. Navid Vahedi, the owner of the pharmacy, will pay restitution estimated at $4.4 million and has agreed to forfeit an additional $1.3 million per the plea agreement. Vahedi could face up to five years in federal prison and is awaiting a sentencing hearing which is scheduled for June 28, 2021.
With the severe repercussions linked to different forms of health care fraud like violating the False Claims Act, having a seasoned defense attorney may be the difference between continuing as a medical provider and facing prison time. Call the offices of Padula Law at (305) 455-5206 for a confidential consultation.
