Indictments handed down in $1B telemedicine fraud scheme

The Department of Justice indicted four men and seven companies for their roles in a $1 billion healthcare fraud scheme and announced plea deals and another charge.

Several individuals and their Florida-based pharmacies were charged with conspiracy to commit healthcare fraud, mail fraud and introducing misbranded drugs into interstate commerce.

The scheme spanned several states, with the defendants utilizing HealthRight, LLC, a telemedicine company with locations in Florida and Pennsylvania, to fraudulently solicit insurance coverage information and prescriptions from consumers for prescription pain creams and other similar products.

The individuals and their companies conspired to deceive thousands of patients and more than 100 doctors in Eastern Tennessee and across the country to defraud private healthcare benefit programs, such as Blue Cross Blue Shield of Tennessee, out of roughly $174 million, according to the DOJ. The defendants submitted “not less than [$931 million] in fraudulent claims for payment,” the DOJ stated.

BCBS of Tennessee was just one insurer out of hundreds impacted by the case. BCBS of Tennessee estimated "the potentially fraudulent claims filed with our company total around $2 million," Mary Danielson, director of corporate communications of BCBS of Tennessee, said in a statement.

"We are working with authorities through this process in hopes of recouping these funds," she said. "And we remain committed to partnering with our customers, providers and law enforcement to fight fraud, waste, and abuse in the healthcare system."

HealthRight and its CEO Scott Roix, of Seminole, Florida, pleaded guilty to felony conspiracy for their roles in the scheme on Sept. 26, 2018, including fraudulently telemarketing dietary supplements, skin creams and testosterone.

Andrew Assad of Palm Harbor, Florida; Peter Bolos, Lutz, Florida; and Michael Palso, of Odessa, Florida, were indicted along with their compounding pharmacies, Synergy Pharmacy Services and Precision Pharmacy Management.

Also named as a defendant and pharmacy compounder was Larry Everett Smith, of Pinellas Park, Florida, and his companies Tanith Enterprises, ULD Wholesale Group and Alpha-Omega Pharmacy, all located in Clearwater.

“If convicted, Assad, Bolos, Palso and Smith face a term of up to 20 years in prison as to each mail fraud charge, up to 10 years in prison for the conspiracy, and up to three years in prison for introducing misbranded drugs into interstate commerce,” the DOJ stated.

They also face fines up to $250,000 and up to three years of supervised release for each count. The companies could be on the hook for twice the amount of the gross loss as a result of the conspiracy, and the indictment seeks forfeiture of roughly $154 million.