Fraud Pharmacy

Medicare enrollment form and glasses

Michael Murphy was the owner of Cure Pharmacy in Jacksonville, Florida, a bona fide neighborhood store for locals to get prescriptions filled and to buy over-the-counter medications and health supplies. However, Cure Pharmacy was apparently not a normal business and Murphy invested in this company with the intent to fraud. While business was normal in the front, behind the store counter Murphy was in the back defrauding the Medicare system.

From 2019 to 2021, Murphy solicited telemarketing companies offering kickbacks and bribes in exchange for recruiting Medicare beneficiaries to accept prescriptions for various medications – mainly topical creams – which the beneficiaries usually did not want or need. Murphy also paid kickbacks and bribes to telemedicine companies that employed or contracted with physicians who signed the prescriptions. The physicians had no physician-patient relationship with the beneficiaries and typically signed the prescriptions with no contact at all with the patient.

After obtaining Medicare beneficiary information and the signed prescriptions, Murphy submitted claims to Medicare for medically unnecessary medications, sometimes through two other pharmacies he owned and controlled in a practice known as “recycling,”. In total, Murphy received $8.3 million from Medicare Part D in total fraudulent funds.

Murphy pleaded guilty on September 27, 2022, to health care fraud and will be sentenced at a later date. Fortunately, Cure Pharmacy is now closed to fraudulent business, but unfortunately closed to those in Jacksonville needing legitimate prescriptions filled.

Shout out to the Health and Human Services office in this investigation.

Today’s Fraud of the Day is based on an article “Florida man pleads guilty in $8.3 million pharmacy fraud scheme” published by Niceville News on September 29, 2022.

According to the Department of Justice (DOJ), Michael Murphy, 37, of Fort Lauderdale, pleaded guilty last week to conspiring to commit health care fraud. The DOJ said the $8.3 million scheme involved pharmacy owners who allegedly paid kickbacks and bribes to telemarketers and telemedicine providers to secure orders for medically unnecessary prescriptions that were billed to Medicare.

According to court documents, Murphy invested in Cure Pharmacy in Jacksonville and two other pharmacies that participated in the Medicare program. From in or around November 2019 through or around March 2021, Murphy and his co-conspirators are said to have paid kickbacks and bribes to telemarketing companies in exchange for recruiting Medicare beneficiaries to accept prescriptions for various medications – mainly topical creams – which the beneficiaries usually did not want or need.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.