Central Rexall was a retail pharmacy in Louisiana, and just as its name would suggest, was “central” to something. In this case it was central to a $46 million dollar health care scheme that targeted the health plans for New Jersey state and local government employees, which included teachers, firefighters, municipal police officers, and state troopers – and also the TRICARE health care program for service members and their families.
In 2013, Christopher Johnston and Trent Brockmeier allegedly entered into an agreement with Central Rexall to take over the management of the pharmacy and expand the compounding business in exchange for 90 percent of the profits. And they hired Christopher Casseri to the position of Vice President of Sales to grow the business. Coincidentally, or not coincidentally, Casseri learned that insurance plans would reimburse thousands of dollars for a one-month supply of certain compounded medications – including pain, scar, and antifungal creams. Great way to boost the profits! These fraudsters then began to design compounded medications and manipulate the ingredients in the medications to obtain high insurance reimbursements rather than serve the medical needs of actual patients.
To determine which ingredients and combinations resulted in the highest insurance reimbursements, Casseri and his co-conspirators had Central Rexall employees send the insurance companies Pharmacy Benefits Administrator false prescription claims to test out different combinations of ingredients, even though the prescriptions did not exist. At their direction, Central Rexall employees sent compounded medications to patients without any research or testing showing that the combination of ingredients was effective. It was strictly for financial gain.
On November 13, 2024, Casseri plead guilty to health care fraud. He is to be sentenced March 18, 2025. The charges against Johnston and Brockmeier remain pending, and they are scheduled to proceed to trial in January 2025.
Shout out to the Department of Health and Human Services in this case.
Today’s Fraud of The Day is based on article “Former exec at Central Rexall pleads guilty in compounded meds scam targeting NJ healthcare” published by Cherry Hill Courier-Post on November 14, 2024
A Louisiana man has admitted to playing a key role in a scheme that caused more than $46 million in bogus insurance claims for New Jersey and military health benefits programs, authorities say. Christopher Casseri was a former sales executive with Central Rexall, a Louisiana pharmacy that made compounded medications, according to the U.S. Attorney’s Office for New Jersey.
Participants in the multi-year fraud submitted prescriptions for medically unnecessary medications, including pain, scar and antifungal creams. They then shared in profits from insurers’ payments for the costly drugs, the federal prosecutor’s office said in a statement.