American Justice Notebook

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Pharmacist Guilty of 22 Felonies for Role in $11 Million Scheme to Defraud Military Heath Care

          LOS ANGELES 

brown wooden chairs inside roomA jury found a licensed Orange County pharmacist of nearly two dozen federal criminal charges for her role in a healthcare fraud scheme in which more than 1,000 bogus prescriptions for compounded medications were filled, officials announced Wednesday.

This cost Tricare, the U.S. military’s health care plan, more than $11 million in losses, according to authorities.

          Sandy Mai Trang Nguyen, 42, of Irvine, was found guilty Tuesday afternoon of 21 counts of healthcare fraud, and one count of obstruction of a federal audit.

          Compounded drugs are tailor-made products doctors may prescribe when the Food and Drug Administration-approved alternative does not meet a patient’s health needs.

          white and black printer paperAccording to evidence presented at her five-day trial, Nguyen was the pharmacist-in-charge of the now-defunct Irvine Wellness Pharmacy in Irvine.

From late 2014 to May 2015, Nguyen and others under her supervision filled approximately 1,150 compounded prescriptions for pain, scarring, and migraines that Tricare reimbursed for tens of thousands of dollars per prescription.

Nearly all of the prescriptions were sent to the pharmacy by so-called marketers who were paid kickbacks of upwards of 50% of the Tricare reimbursements. 

The beneficiaries were solicited to provide their Tricare insurance information for medications they did not seek out or need, and a physician never examined most.

The prescriptions were electronically sent from marketers or telemedicine businesses and submitted by the pharmacy for reimbursement even though Tricare rules excluded reimbursements for claims based on telemedicine visits and would not, in any event, have been authorized had Tricare known the prescriptions originated based upon the payment of kickbacks. 

Nguyen was aware that physicians purportedly wrote the prescriptions in states other than where the beneficiaries lived, and multiple members of the same families received the same medications, according to officials.

The same prescriptions were written for members of different patient populations, including a 13-year-old boy in Chicago who got the same prescription as an 86-year-old woman in Orange County who happened to be Nguyen’s grandmother.

The pharmacy invoiced the beneficiaries to pay hundreds of dollars in required co-payments.

Still, according to trial testimony, the beneficiaries stated that they knew nothing about co-payments and understood that the medications were fully covered by Tricare.

The total co-payments due during the scheme exceeded $16,000, but the pharmacy never collected them.

During Nguyen’s tenure as pharmacist-in-charge, Tricare paid $11 million on the fraudulently submitted claims.

Nguyen also obstructed a federal audit by providing bogus, cut-and-pasted prescriptions to cover up Tricare’s effort to validate millions of dollars paid for the same prescriptions.

Nguyen is scheduled for an April 3 sentencing hearing.

At that time, Nguyen will face up to 10 years in federal prison for each healthcare fraud count. She also faces up to five years in federal prison for the audit obstruction count.

The Department of Defense, Office of Inspector General; the Defense Criminal Investigative Service; the FBI; the Amtrak Office of Inspector General; IRS Criminal Investigation; the United States Department of Labor – Employee Benefits Security Administration; the California Department of Insurance; and the Office of Personnel Management, Office of Inspector General investigated this matter.

Assistant U.S. Attorneys Mark Aveis and Ali Moghaddas of the Major Frauds Section are prosecuting this case.

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