Federal authorities on Oct. 12 unsealed a 32-count indictment that charged four individuals and seven companies in a $1 billion health care fraud scheme, the Department of Justice announced.
Between June 1, 2015, and April 1, 2018, the defendants conspired to deceive tens of thousands of patrons, including over 100 doctors, to defraud private health care benefit programs, the indictment alleges. The crimes took place in the Eastern District of Tennessee and across other parts of the country.
At least $931 million in fraudulent health care claims for payment were submitted. In one case, they defrauded Blue Cross Blue Shield of Tennessee out of $2 million, according to Mary Danielson, director of corporate communications at Blue Cross Blue Shield of Tennessee.
Andrew Assad, Peter Bolos, Michael Palso, and Larry Everett Smith, along with their compounding pharmacies located in Florida and Texas, were charged with conspiracy to commit health care fraud, mail fraud, and introducing misbranded drugs into interstate commerce. The four individuals have been released on bond and are scheduled for a court appearance on Oct. 25.
In addition to the four individuals, HealthRight LLC, a telemedicine company with locations in Pennsylvania and Florida, and its CEO, Scott Roix, pleaded guilty in September to felony conspiracy for roles in the fraud. Both Roix and the company also pleaded guilty to conspiring to commit wire fraud in a separate scheme.
The defendants allegedly set up “an elaborate telemedicine scheme,” in which HealthRight fraudulently solicited insurance coverage information and prescriptions from consumers across the country for prescription pain creams and other similar products. Doctors had approved the prescriptions, without knowing that the products were massively marked up, which the defendants then billed to private insurance carriers.
If convicted, each of the individuals faces up to 20 years behind bars. Additionally, they face fines of up to $250,000 and up to three years of supervised release on each count. The indictment also seeks forfeiture of approximately $154 million.
Roix faces a maximum sentence of five years in prison for each conspiracy charge.
Correction: A previous version of this article misstated the amount Blue Cross Blue Shield of Tennessee was defrauded of. Blue Cross Blue Shield of Tennessee was defrauded of 2 million. The Epoch Times regrets the error.