A Lower Manhattan pharmacist has been convicted of a multi-million dollar Medicaid fraud scheme involving drugs prescribed to treat HIV and AIDS.
On Friday, State Attorney General Leticia James announced that Hin Wong, who operated the New York Pharmacy (located at 131 Walker Street, in Tribeca) had entered a guilty plea to a single count of grand larceny in the first degree, a class “B” felony.
Ms. Wong’s guilty plea was the result of a negotiated settlement, under which she will pay $3.6 million in restitution, and face between two and six years in prison, when she in sentenced, in March. This is, in some respects, a lenient disposition, insofar as prosecutors initially estimated her fraud against the Medicare system to have exceeded $11 million, when Ms. Wong was first arrested and charged, in 2017.
In court, Ms. Wong admitted to paying (or directing her employees to pay) bribes to undercover agents from the Medicaid Fraud Control Unit of Ms. James’s office, in return for a promise to fill their prescriptions for HIV medications at her pharmacy. Ms. Wong then billed — and was eventually paid for — refills on these prescriptions, which were never dispensed. According to court papers, Ms. Wong expanded the scope of this false claims scheme by paying additional kickbacks to undercover agents, to induce them to recruit and steer others to fill similar prescriptions with Ms. Wong.
Charging documents filed in the case allege that, “once Wong has obtained a prescription, by purchase or otherwise, [she] uses her Pharmacies to bill Medicaid for refills, despite the fact that the customer never requested the refills and in nearly every instance the Defendant Pharmacies did not dispense them, a scheme commonly known as ‘auto-refilling.'”
The same documents contend that, “Wong profited exponentially as a result of this fraudulent scheme because the Pharmacies never had to expend money to purchase the amount of medication inventory that would otherwise be necessary if they were, in fact, legitimately filling and dispensing the refills.”
The Attorney General’s office alleges that the earnings from this swindle fueled lavish spending by Ms. Wong, including more than $40,000 at Prada during a single two-month period in 2017. Prosecutors also believe that she billed Medicaid (along with other insurance providers) a total of more than $15 million for these drugs between 2014 and her arrest in 2017. The investigation was originally triggered when State regulators noticed that actual purchases of these medications by Ms. Wong’s pharmacy from drug wholesalers had been in far smaller quantities than the amounts she was billing the Medicaid program for.
“This defendant exploited some of our State’s most vulnerable patients to steal millions of dollars reserved to provide New Yorkers with essential healthcare,” Ms. James said.
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