Feds announces drug, health card fraud busts in Metro Detroit
44 arrested after prescription drug scheme investigation in Michigan
Wednesday, U.S. Attorney Barbara L. McQuade announced the arrests of 44 people across Metro Detroit after a large scale drug and health care fraud bust.
The 13-count indictment charges the defendants with a drug conspiracy involving prescription drugs, controlled substances and other drugs.
McQuade said today's arrest included: seven doctors, four pharmacists, three home health agency owners and one physician's assistant amongst many others.
They are all accused of defrauding insurance companies out of more than $40 million through an elaborate prescription drug scheme.
"The merger of health care fraud and drug trafficking is a disturbing trend that is not only robbing taxpayers, but also fueling addictions to prescription drugs," said McQuade. "Prescription drug abuse has become a national epidemic, with more Americans dying from overdoses than from gunshot wounds."
The government says the scheme was rooted in southeastern Michigan but stretched 250 miles southeast to Youngstown, Ohio, where many addictive painkillers were sold on the street.
The arrests came one day after 13 defendants were added to an indictment against Canton Township pharmacist Babubhai "Bob" Patel.
Patel is charged with overseeing a health care fraud and drug distribution ring at the 21-plus pharmacies he owned and controlled in and around Detroit.
McQuade says Wednesday's arrests are separate from the Patel case but highlight the wide spread problems of drug and health care fraud in Michigan.
She says drug rings are using recruiters to look for low-income individuals on either Medicare, Medicaid, or who have private insurance.
The recruiters lure participants with the promise of making extra cash for their part in the scheme.
These people are then taken to fraudulent doctors who write prescriptions for drugs like, oxycodone, Vicodin, Lortab, Xanax, and cough syrups with codeine.
The medical professionals and health care agency owners would then bill the insurers for services supposedly provided to the patients.
In some cases, home health care owners paid physicians associated with the scheme kickbacks in exchange for prescriptions for patients.
The prescriptions are taken to a pharmacist who would also bill for dispensing the medications, despite the fact that the medications were medically unnecessary and, in many cases, never provided. Other times, the pharmacists accepted cash from the recruiters for filling and dispensing medications.
The drugs ultimately are sold on the street level across Metro Detroit and other states.
In some cases, McQuade said the pain killers can sell up to $60 a pill.
Prescription drug fraud puts a stain on the health care system and puts opiate drugs like Vicodin in the hands of children, she said.
"These arrests are the result of countless hours of hard work by the FBI and its law enforcement partners. We remain dedicated to pursuing and prosecuting any individuals who illegally exploit the health care system for their own personal gains," said FBI Special Agent in Charge Foley.