The DOJ announced that Hua Huang, an employee of NY Elm Pharmacy Inc., and Huiling Wu, owner and employee of 888 Pharmacy Inc., were arrested for their roles in several schemes to defraud Medicare and Medicaid. Huang and Wu are alleged to have paid illegal kickbacks and bribes for unnecessary prescriptions which resulted in Medicare and Medicaid losing over $10.5 million.

Federal agents executed searches of both NY Elm and 888 Pharmacy concurrent with the arrests of Huang and Wu. The Anti-Kickback Statute (AKS) prohibits receiving or soliciting remuneration in exchange for any item or service paid in whole or in part by federal health care programs. Claims submitted to Medicare and Medicaid in violation of the AKS constitute false claims and are actionable under the False Claims Act. 

According to the government, Huang referred an individual to a podiatrist who signed medically unnecessary prescriptions. In turn, Huang provided the individual with supermarket gift certificates for each prescription brought to NY Elm Pharmacy and billed to Medicare and Medicaid. Huang also allegedly provided cash to the individual in exchange for their monthly insurance allowance. Similarly, Wu is alleged to have referred an individual to a podiatrist who signed unnecessary prescriptions, and she provided store credit for each prescription brought to 888 Pharmacy and billed to Medicare and Medicaid. Wu also provided supermarket gift certificates in exchange for the individual’s monthly insurance allowance. 

Acting Special Agent in Charge Susan A. Frisco of the U.S. Department of Health and Human Services Office of Inspector General noted that their agency “[…]remain strong in our resolution to investigate and pursue individuals who allegedly operate counter to laws protecting federal health care programs.” The two New York women face up to 10 years in prison if they are found guilty of submitting claims for medically unnecessary prescriptions to Medicare and Medicaid.

The attorneys at Chilivis Grubman represent clients of all types and sizes in connection to health care fraud and False Claims Act litigation. If you need assistance with such a matter, please contact us today.