Pharmacy Indicted for Medicaid Fraud
Albany, February 3, 1998 – Undercover investigators from the State Health Department assisted the New York County District Attorney's Office in uncovering a forged prescription scam that led to the indictment of seven people, including a Lower East Side pharmacist, on charges of defrauding the New York State Medicaid program.
The Manhattan District Attorney announced today the indictment of Frances Leung, a registered pharmacist, who owns and operates the LP Pharmacy at 263 Elizabeth Street in Manhattan. Six other individuals who participated in the Medicaid scam were also indicted.
The State Health Department also has taken action to exclude Frances Leung and the LP Pharmacy from participation in the State Medicaid program.
"Today's actions underscore Governor Pataki's commitment to improving communication and cooperation among State, federal and local agencies to ensure fraud and abuse in the Medicaid program is rooted out, " said State Health Commissioner Barbara A. DeBuono, M.D. "Medicaid exists to provide medical services for the needy, not as a cash cow for the unscrupulous."
At the request of the District Attorney's Office, Health Department undercover investigators infiltrated the group that was passing forged prescriptions through the LP Pharmacy. The investigation revealed that the defendants obtained Medicaid identification cards from Medicaid recipients in exchange for cash or prescription medications. They then created false prescription slips and presented the Medicaid cards and fake prescriptions to the LP Pharmacy. The prescription drugs were sold on the street in the Seward Park area.
Further adding to Medicaid fraud, the pharmacist billed the Medicaid program for prescription medications in greater quantities than the drugs actually dispensed. The estimated cost to the Medicaid program and to taxpayers of this scheme is $200,000.
Responsibility for the Medicaid Office of Quality Assurance and Audit was transferred from the State Department of Social Services to the Department of Health last Fall.
"Our investigation of prescription drug fraud is continuing, and we expect it to result in additional arrests in the future," the Commissioner said. "We are committed to ensuring taxpayers that the money spent in the State's multi-billion dollar Medicaid program is providing medical care for New York's vulnerable low-income residents."