On Friday, it was announced that a married couple living in Cleveland, Tennessee had been arraigned in federal court on charges that they had operated a scheme to bilk Tricare out of more than $65 million in pharmacy reimbursement funds. The indictment shows that Jimmy and Ashley Collins conspired with CFK Inc, which is the owner of The Medicine Shoppe, to submit fraudulent claims for compounded medications mailed primarily to active duty Sailors and Marines based in California.
The Medicine Shoppe is a pharmacy based out of Utah. The indictment alleges that between October 2014 and July 2015, the Collins couple operated a network of recruiters to help TRICARE beneficiaries acquire compounded medications. On average, these medications costed more than $14,500 per medication each month. The recruiters told the potential beneficiaries that they would be paid to evaluate the medication as a part of an ongoing study.
The indictment alleges that there was no study. After a beneficiary had agreed to take part, the straw beneficiary’s information was sent to Choice MD, a medical clinic in Tennessee co-owned and operated by the Collins couple. Doctors at Choice MD and employed by the Collins couple wrote prescriptions for the TRICARE beneficiaries. The prescriptions were not given to the straw beneficiaries. Instead, they were sent to The Medicine Shoppe and other related pharmacies.
These pharmacies filled the prescriptions and billed TRICARE at exorbitant prices. Between December 2014 and May 9, 2015, doctors working for the Collins couple authorized 4,442 prescriptions, which were ultimately filled at The Medicine Shoppe. As a result, The Medicine Shoppe billed TRICARE more than $65 million for those prescriptions. The owners of The Medicine Shoppe paid kickbacks to the Collins couple based on the number of prescriptions referred.
From February to July 2015, the kickback payments totaled at least $45.7 million dollars. Then, the Collins couple paid kickbacks to recruiters working in their network. Jimmy and Ashley Collins will appear in court again on February 2, 2018. At this point in time, the defendants remain innocent until proven guilty beyond a reasonable doubt in a court of law.
Additional details regarding the indictment can be found here.