Pharma Sales Rep Pleads Guilty to Healthcare Fraud and Criminal HIPAA Violations
A pharmaceutical sales rep has pleaded guilty to conspiring to commit healthcare fraud and wrongfully disclosing and obtaining patients’ protected health information in an elaborate healthcare fraud scheme involving criminal HIPAA violations.
Keith Ritson, 42, of Bayville, New Jersey, is a former pharmaceutical sales representative who promoted compound prescription medications and other drugs between 2014 and 2016. Compound prescription medications are specialty drugs that are mixed by a pharmacist to meet the needs of individual patients and are typically prescribed when standard medications for a specific medical condition cannot be taken by a patient, due to an allergy for instance. Compound prescription medications are not FDA approved but can be legally prescribed by a physician who determines that standard medications are not appropriate for a particular patient.
Ritson discovered that certain health insurance plans with pharmacy benefit management services covered compound prescription medications from a Louisiana pharmacy – Central Rexall Drugs, Inc. The pharmacy benefits administrator paid prescription drug claims and the state of New Jersey and other insurance plans were billed for the amounts paid. Ritson and his conspirators discovered certain insurance companies would reimburse thousands of dollars a month for some compound prescription medications, and Ritson would receive a percentage of the money paid to the pharmacy by the pharmacy benefits administrator for any prescription medications he arranged.
Individuals who had insurance plans that covered the compound medications would be recruited to receive the medications, even if they were not medically necessary, and Ritson himself also received the medications. Ritson identified the patients through the medical practice of Dr. Frank Alario. Alario pleaded guilty to his role in the healthcare fraud scheme earlier this month.
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Ritson was not associated with Alario’s medical practice and was therefore not permitted to access or obtain the protected health information of Alario’s patients, but Alario provided Ritson with access to his offices and patient information to check which patients had insurance plans that would cover the medications. Ritson would then earmark patients so Alario would then know which patients to prescribe the medications to. In some instances, Ritson was present in patient examination rooms with Alario, and patients were given the impression that he was either employed by the medical practice or was affiliated with it.
Ritson used patient information to fill out prescription forms and Alario would then authorize the prescriptions. Ritson would then be paid a commission on those prescriptions. Ritson pleaded guilty to one count of conspiracy to commit health care fraud and one count of conspiring to wrongfully disclose and obtain patients’ PHI on October 19, 2022. He is due to be sentenced on Feb. 7, 2023, and faces up to 10 years in jail, a $250,000 fine for the healthcare fraud count, and a maximum of one year in jail for the criminal HIPAA violation and a $50,000 fine. Alario faces up to one year in jail and a $50,000 fine for his role in the scheme.
Three former executives of Central Rexall Drugs were charged for their role in the scheme in a 24-count indictment including healthcare and wire fraud. They are Christopher Kyle Johnston, 43, of Mandeville, Louisiana; Trent Brockmeier, 60, of Pigeon Forge, Tennessee; and Christopher Casseri, 54, of Baton Rouge, Louisiana. Hayley Taff, 39, of Hammond, Louisiana, worked at the pharmacy and pleaded guilty to conspiracy to commit healthcare fraud and is due to be sentenced on March 13, 2023.
