TRICARE Settles Large Case with Florida Pharmacies and Doctors for $10 Million

Monday, February 15, 2016
By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

On February 10, 2016, the U.S. Department of Justice (DOJ) announced it had reached a settlement agreement with two compounding pharmacies and four physicians in Florida for $10 million. The physicians, Manish Bansal, Mehul Parekh, Marisol Arcila, and Syed Asad allegedly profited from the military’s health care program called TRICARE. The settlement is to resolve allegations that they took advantage of military members by prescribing costly and unused prescriptions that were filled by the compounding pharmacies. The allegations state that they also created two compounding pharmacies in which they steered prescriptions to, Topical Specialists and WELLHealth Pharmacy.

To read the DOJ’s press release on this case, click here.

Inflated Reimbursements.

According to the DOJ, the physicians allegedly wrote hundreds of prescriptions for pain and scar creams that were never used by patients. The four physicians accounted for roughly 40 percent of the prescriptions submitted by WELLCare and Topical Specialists. They received hundreds of thousands of dollars in return from the pharmacies when the federal government reimbursed them at highly inflated rates for the cost of compounding the creams.

“While the pharmacies billed the federal government tens of thousands of dollars for these creams, the cost to actually compound them was often 4-5 percent of the submitted cost. Records reviewed by the government showed that the pharmacy was making up to 90 percent profit for each cream submitted to the TRICARE program. This profit was then disbursed to the doctors who wrote the prescriptions,” reported the DOJ.

To read one of my prior blogs on another case of fraud involving TRICARE, click here.

Getting Other Physicians Involved in the Scam.

The government alleges that the four physicians also recruited other doctors to write prescriptions by offering to share the profit with them. In some cases, a doctor who wrote prescriptions to the two compounding pharmacies, Topical Specialists and WELLHealth, received up to 40 percent of the reimbursement.

Identifying Health Care Fraud.

This settlement involved false claims submitted to the TRICARE program and was developed as part of a broader effort to identify and target corrupt compounding pharmacies. After authorities spoke to several of the physician’s former patients, the government contends that these prescriptions were often not used by patients, despite the tremendous cost to the government. According to the DOJ, certain defendants suggested that payments to physicians for these prescriptions were legitimate because these physicians were engaged in a “research study” to monitor the clinical effectiveness of these creams. No patient contacted by the government knew that they were enrolled in a research study, and no research findings were ever published.

Don’t Wait Until It’s Too Late, Report All Illegal Activity Immediately.

Individuals working in the health care industry, whether for hospitals, nursing homes, medical groups, home health agencies or others, often become aware of questionable activities. Often they are even asked to participate in it. In many cases the activity may amount to fraud on the government. The federal government wants you to report these fraudulent activities and therefore, has a whistleblower's reward law, called the False Claims Act. Most states now have similar laws that apply to filing any false claims against the state's Medicaid program or any other false claims for payment by the state. Sometimes these laws provide a minimum reward for the person making the claim, regardless of how much is actually recovered.

To read a prior blog I wrote about whistleblower’s in False Claims Act cases, click here.

Contact an Experienced Health Law Attorney to Assist in Whistleblower/Qui Tam Cases.

If you have knowledge of false claims being filed against Medicare, Medicaid, TRICARE/CHAMPUS or any other type of government program, please contact us, and we will be happy to assist you. Our law firm represents health professionals and health care organizations almost exclusively. In addition to our other experience in Medicare and Medicaid cases, we also represent health care professionals in qui tam/whistleblower cases.

We have been involved in a number of whistleblower/qui tam cases, in which we represent the person who files the claim. We have developed relationships with recognized experts in health care accounting, health care financing, utilization review, medical review, and other experts that assist us in such matters.

The Health Law Firm and its legal professionals represent health care providers in health care fraud cases including False Claims Acts, Medicare and Medicaid fraud and qui tam or whistleblower cases. These include physicians, medical groups, mental health professionals, pharmacies, nursing homes, home health agencies, hospitals and other health facilities.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at


Wolf, Alex. “Fla. Pharmacies, Docs Settle Tricare Billing Row For $10M.” Law360. (February 11, 2016). Web.

Department of Justice. “United States Announces Approximately $10 Million Settlement With Four Physicians And Two Compounding Pharmacies.” U.S. Attorney’s Office
Middle District of Florida. (February 11, 2016). Web.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida, area.  The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

KeyWords: Compounding pharmacy, TRICARE, False Claims Act (FCA), U.S. Department of Justice (DOJ), submitting false claims, health care fraud, whistleblower, false billing, whistleblower defense attorney, False Claims Act defense lawyer, DOJ settlement lawyer, federal health care programs, qui tam lawyer, FCA settlement, health care law attorney, health care fraud scheme, health care professional legal representation, health care fraud defense attorney, health law, Florida health law attorney, The Health Law Firm

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
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