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Senior Director of Strategic Alliances
LexisNexis Risk Solutions - Government

Drug compounding is often regarded as the process of combining, mixing, or altering ingredients to create a medication tailored to the needs of an individual patient. Compounded drugs are not FDA-approved. They are special. So special, they don’t fit into Medicare rules. Which, maybe, makes them vulnerable to fraud? Or at least in this $65 million dollar scheme it did. Back in June of 2023, Jimmy and Ashley Collins, a married couple living in Birchwood, Tennessee, were sentenced to prison for orchestrating a health care fraud scheme that bilked millions from the Medicare funded TRICARE program. But this kind of scheme can’t be done alone. Jimmy and Ashley needed to recruit. So, they shanghaied Daniel Castro, Jeremy Syto and Candance Craven to make it happen.

Castro and Syto recruited TRICARE beneficiaries to sign up to receive expensive compounded medications, even though they did not really need the medications. Castro and Syto then sent the beneficiaries information to Choice MD, a Tennessee medical clinic co-owned and operated by Jimmy and Ashley Collins. Here in the clinic, prescriptions for the TRICARE beneficiaries were fulfilled despite never conducting a medical review or examination of the patients in person.

December 2014 and May 9, 2015 – the day TRICARE stopped reimbursing compounded medications – these conspirators wrote thousands of fraudulent prescriptions amounting to $65,679,512 in fraudulent reimbursements. For recruiting bogus patients, Castro and Syto were paid a commission off the total TRICARE reimbursement paid to the pharmacy for the drugs sent to their recruits. Over the course of the conspiracy, the illegal kickbacks amounted to at least $1,013,450.36 for Castro and $264,000 for Syto. A small amount for the bulk of the work.

Great job by the Department of Health and Human Services.

Today’s Fraud of The Day is based on article “Former Miramar Marines sentenced to prison in $65 million prescription fraud case” published by the San Diego Union-Tribune on February 17, 2024

Two former U.S. Marines were sentenced in federal court to more than a year in prison for their role in a fraud scheme that bilked TRICARE, the military’s health care program, out of more than $65 million, federal officials said Friday.

Daniel Castro, from Oak Lawn, Ill., got a 21-month sentence, and Jeremy Syto, of Chula Vista, received 15 months. Both men had been based at Marine Corps Air Station Miramar. A nurse practitioner, Candace Craven, was sentenced as well, to three months home confinement.

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