Politics & Government

Bloomfield Man Charged in Massive Medicaid Fraud Scheme

Manhattan U.S. Attorney said the fraud involved the entire US health care system.

 

A Bloomfield man was one 48 people charged with the unlawful diversion and trafficking of hundreds of millions of dollars’ worth of prescription drugs, the FBI announced this week.

Lazaro Ospina of Bloomfield was sentenced to five years in prison for a list of charges that included Conspiracy to commit wire fraud, mail fraud, and healthcare fraud, as well as Conspiracy to commit adulteration and misbranding offenses and the unlawful wholesale distribution of prescription drugs.   

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The massive fraud scheme involved selling “second-hand” drugs -- prescription drugs that had previously been dispensed to Medicaid recipients – to unwitting buyers in a national underground market.

Manhattan U.S. Attorney Preet Bharara said, “As alleged, these defendants ran a black market in prescription pills involving a double-dip fraud of gigantic proportions. It worked a fraud on Medicaid—in some cases, two times over—a fraud on pharmaceutical companies, a fraud on legitimate pharmacies, a fraud on patients who unwittingly bought second-hand drugs, and ultimately, a fraud on the entire health care system. With the dozens of arrests we made today, we have taken a significant step toward exposing and shutting down the black market for second-hand drugs, and our investigation is very much ongoing.”

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A press release from the Manhattan U.S. Attorney’s office stated that the prescription drugs involved in the fraud scheme included drugs for HIV, schizophrenia, and asthma, -- non-controlled substances that did not lend themselves to abuse.  In some cases, Medicaid would have reimbursed patients for the same drugs twice—the second time for drugs that were misbranded, adulterated, and possibly expired—and would thereby have been defrauded twice.

 


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