Ten Additional Defendants Charged in $100 Million TRICARE Fraud Scheme
"Exhaustive investigative work by
"Today's arrests helped to alleviate the burden on the American taxpayers from an organized group determined to commit fraud within the healthcare industry, principally, the TRICARE system," said Acting SAC Michael A. Costanzi of
"The indictments and arrests in this investigation highlight another step forward by DCIS and its law enforcement partners to protect the integrity of the
The superseding indictment names the following defendants:
Dr.
Dr.
Ravi Morisetty, 42, of
Defendants Fuller and Baumiller, the owner and President, respectively, of
Two additional defendants charged in the conspiracy,
The superseding indictment alleges that from approximately
Cesario and Cooper co-owned and co-operated
Defendants Straw and Kiselak led marketing groups for CMGRX that recruited military members and their families and offered them monetary compensation in exchange for obtaining compounded drugs with their TRICARE prescription benefits as part of CMGRX's study. Defendant Rios, a marketer and patient recruiter in Straw's marketing group, recruited hundreds of beneficiaries on and around
According to the superseding indictment, as part of their scheme to defraud, Cesario, Cooper, Straw, Rios, Kiselak and their coconspirators offered to pay, and did pay, TRICARE beneficiaries for obtaining and filling prescriptions for compounded drugs, principally compounded pain creams, scar creams, migraine creams, and vitamins. They disguised these payments to TRICARE beneficiaries as "grants" for participating in a medical study they referred to as a TRICARE-approved "Patient Safety Initiative" or "PSI Study" to evaluate the safety and efficacy of compounded drugs. In reality, the PSI Study was not approved by TRICARE, was not overseen by a qualified physician or medical professional, had no control group, and was not designed to gather any useful scientific data relating to the safety and efficacy of any drug. Its true purpose was to compile a list of TRICARE beneficiaries who had filled prescriptions so that Cesario, Cooper and their coconspirators could calculate how much to pay the beneficiaries.
To further disguise the source of those kickbacks to TRICARE beneficiaries, according to the superseding indictment, Cesario and Cooper directed the creation of a charity and funneled the payments to the beneficiaries through the charity. Kiselak introduced Cesario and Cooper to an individual who helped them create the "Freedom From
Defendant Simmons served as the Chief Medical Officer for CMGRX and helped Cesario and Cooper create the PSI Study. Defendant Elder-Quintana worked as a contract physician with CMGRX., and Cesario and Cooper paid him to prescribe compounded drugs to TRICARE beneficiaries. Some of the payments were made directly to Elder, while others were made to
Each defendant is charged with one count of conspiracy to commit health care fraud, which, upon conviction, carries a maximum statutory penalty of 10 years in federal prison and a
The superseding indictment also includes a detailed forfeiture allegation that would require the defendants, upon conviction, to forfeit to the
An indictment is an accusation by a federal grand jury, and a defendant is entitled to the presumption of innocence unless proven guilty.
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