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News | May 18, 2021

Six Individuals Sentenced for Roles in Healthcare Fraud Involving Northern Virginia Pharmacies

By DCAA Staff Writer

DCAA auditor Andy Hale and Supervisory Auditor Sandy Porter assisted in an investigation that resulted in sentencing of six individuals for healthcare fraud. On April 16, 2021, the last of six defendants were sentenced for participating in multiple health care fraud conspiracies involving fraudulent billings that resulted in nearly $8 million in losses to federal, state and private health care benefit programs.

Mohamed Abdalla, of Allendale, New Jersey, as owner of multiple pharmacies in Northern Virginia oversaw and executed schemes to defraud federal health care benefit programs, including Medicare and Tricare. From at least January 2014 through 2018, Abdalla participated in kickback schemes, obtaining over $2 million, for the referral of compound medication prescriptions and expensive medical devices which were then billed to federal health care benefit programs. He and employees at his pharmacies also conspired to defraud the health care benefit programs by billing approximately $6.2 million for prescriptions in the names of themselves, family members, and other pharmacy employees that were not medically necessary and/or not prescribed by a licensed physician, and billing for prescriptions that were never filled. Abdalla was sentenced to four years in prison. Five other defendants were also sentenced for a range of one to three years in prison for their various roles in the schemes including circumventing audits and investigations and accepting and paying kickbacks.

DCAA’s auditors reviewed TRICARE reports showing the line item prescriptions that were billed and paid, then merged the internal compounding reports and TRICARE data to determine an equitable estimate of prescription expenses for prescriptions across each of the pharmacies that were the subject of the investigation over the period of two years. The auditors then calculated the net profits for prescriptions across each of the same pharmacies over the same two-year period and prepared a damage calculation by applying kickback agreement percentages to net profits by pharmacy to determine the estimated total amount of kickbacks.

Read the Department of Justice press release here.