3 Bilked Medicaid of Millions Using Fake Billings, U.S. Says
By RICHARD PÉREZ-PEÑA
The New York Times
September 14, 2006
Two brothers, a doctor in Brooklyn and an owner of pharmacies in Brooklyn and Queens, led a conspiracy that defrauded Medicaid of millions of dollars by billing the program for H.I.V. drugs and other medicines that were never given to patients, federal prosecutors say.
The United States attorney’s office announced the arrest yesterday of the brothers, Dr. Muhammad Ejaz Ahmad and Muhammad Nawaz Ahmad, and a third man, Mohammad Tanveer, a pharmacy employee, on charges of conspiracy to defraud the government, punishable by up to five years in prison. The complaint against them points to a larger conspiracy, involving “others known and unknown.”
Two law enforcement officers posing as H.I.V. patients took secret audio and video recordings at the doctor’s office and the pharmacies, according to a statement filed with United States District Court in Manhattan by an F.B.I. agent, Shawn R. Mullen. He said that the undercover officers, like real patients, were given some drugs, but that the conspirators billed Medicaid for many more prescriptions than were ever dispensed.
The defendants paid the patients $40 for each trip to the doctor’s office or pharmacy, the agent said — which prosecutors noted is more than the $30 Medicaid paid the doctor for the visit. They described those payments as illegal kickbacks to the patients, suggesting that at least some patients were aware of the scheme.
The United States Attorney’s Office would not put an overall dollar amount on the cost of the fraud against Medicaid, the joint federal and state health plan for the poor. But the complaint states that for just three antiviral drugs — among many medicines used to treat H.I.V. infection and its side effects — the three pharmacies billed Medicaid for $2.5 million for drugs that they never received from their distributors.
“My guy says he’s absolutely innocent of anything, that he’s a legitimate businessman,” said Patrick Bruno, the lawyer for Mr. Ahmad, the pharmacy owner. The other defendants have not yet hired lawyers, he said.
Dr. Ahmad, 49, practiced internal medicine at an office at 1121 Coney Island Avenue, in central Brooklyn, and lives in Albertson, in Nassau County.
Doctors are supposed to make information about themselves available to the public — things like medical education, malpractice judgments and hospital affiliations — through a State Department of Health Web site. Dr. Ahmad does not appear on that Web site.
The complaint says that Dr. Ahmad’s wife and his brother, who is 38, were co-owners of the three pharmacies involved in the Medicaid scheme. The wife is not named, and is not charged with a crime. Mr. Bruno said the younger Mr. Ahmad, who lives in Floral Park, in Nassau County, also has a medical degree but has never practiced medicine.
Mr. Tanveer, 49, also lives in Floral Park.
All three men are from Pakistan but are longtime United States residents, according to federal officials and Mr. Bruno. They said the Ahmad brothers are citizens, but Mr. Tanveer is not.
At an arraignment late yesterday, bail was set at $300,000 for each of the Ahmad brothers, Mr. Bruno said, and “we hope to make bail within a day.” Both he and a spokeswoman for the prosecutors said they did not know the bail set for Mr. Tanveer.
The allegations in the complaint cover about two and a half years, but federal officials say they are looking at earlier years as well, to determine how far back the fraud goes.
The complaint says that patients with H.I.V. who visited Dr. Ahmad were steered to the pharmacies owned by his brother and wife: Stay Slim Pharmacy, less than a block away from Dr. Ahmad’s office, at 1166 Coney Island Avenue; Script Depot, at 99-06 63rd Road in Rego Park, Queens; and Nash Pharmacy, at 47-07 Francis Lewis Boulevard in Bayside, Queens, where Mr. Tanveer works. In other cases, the doctor got the drugs from the pharmacies, and patients picked them up from him.
One undercover officer got three months’ worth of drugs, but Nash Pharmacy billed Medicaid for eight months’ worth, and tried to bill for more, the complaint says. Though Nash lies in another borough, prescriptions from Dr. Ahmad accounted for three-fourths of the pharmacy’s Medicaid billing last year.
The complaint also says that a real patient of Dr. Ahmad’s received H.I.V. drugs, but Medicaid records for that patient also show that over 22 months, the doctor prescribed $58,000 worth of other medications that the patient says he never took.
One of the stranger elements of the case is the complaint’s description of what it calls kickbacks to the patients. It says that each time an undercover officer met any of the three defendants, the other man would hand him $40, without being asked for money, and without any explanation of what it was for.
