HATTIESBURG, MS (WDAM) - The federal pharmacy investigation that alleges more than $400 million was defrauded from health insurance provider's centers around the Hub City and names local doctors and businesses.
The complaint reveals 235 detailed assets seized, which include cash, cars, boats, airplanes and properties from people in the Hub City.
The court filing lists four "key" names involved in the investigation: Wade Walters, Hope Thomley, both of Hattiesburg, Mitchell "Chad" Barrett of Clinton, and Thomas E. "Tommy" Spell, Jr., of Ridgeland.
"Barrett, Walters, Hope Thomley, and Spell were all the central architects of one of the comprehensive health care fraud, kickback, and money laundering scheme that threated the solvency of some health care benefit programs and operated between Jan. 2012 and Dec. 2015," according to the federal documents. "Others also participated in and benefited from the frauds."
The documents go on to list roughly 20 people who allegedly received proceeds from the scheme.
Some of those people listed include Randel L. Smith, who is a cardiologist at the Hattiesburg Clinic and Howard "Randy" Thomley, who is an authorized signer with Thomley's Christmas Tree Farm and Hub City pharmacist Jason May.
Hattiesburg Clinic released a statement Wednesday night regarding Smith.
The other names include, but are not limited to:
Alison Frame; Bonnie Smith; Brooke Braley; Chandler Smith; Dorothy (Dolly) Walters; Garrett Braley; Glenn Doyle Beach; Glenn Doyle Beach, Jr.; Hope Haws; Hope E. Thomley; Jason May; Joele Smith; Jonathan McFadden; Kelsey May; Stephen T. Mellinger, Jr.; Traci Beach; Wade Walters; and William Christopher Pierce.
Individuals associated with the pharmacies had enormous sums of money and purchased items like vacation properties, investment vehicles, luxury cars, boats and airplanes, according to the complaint filed by the U.S. government.
World Health Industries, Inc, Pro Pharmacy, Located in Jackson, Mississippi, is said to have shipped all of its prescriptions to customers via Federal Express, United Parcel Service and the U.S. Mail.
"World Health operated as a 'hub' for multiple other pharmacies, including but not limited to Van Dev Enterprises, in Port Gibson, Vicksburg Specialty Pharmacy (Vicksburg), Service RX (Ridgeland), Opus Pharmacy (Jackson), and Gluckstadt Pharmacy (Gluckstadt)," according to the court filing. "This method of operation allowed World Health to coordinate the submission of the claims to insurance companies through its affiliate locations. These affiliates also allowed World Health to avoid detection by the insurance programs that had barred World Health from submitting claims."
Advantage Medical and Pharmacy (Advantage Pharmacy) is a compounding pharmacy in Hattiesburg, Mississippi. The pharmacy is said to have marketed and sold compounded prescriptions throughout the United States, and shipped the compounded prescriptions via Fed Ex, UPS and the U.S. Mail. They also operated an affiliate location, Advantage Medical Infusion in Hattiesburg.
"As a result, World Health, Advantage Pharmacy, Aspire RX, and Medworx routinely filled compounded prescriptions for customers for whom no physician had determined medical necessity," according to the complaint.
The Advantage Pharmacy Network:
Court documents allege that between June 2012 and February 2016, overall Advantage Pharmacy was paid at least $155,444,668.00 for compound medications by various federal health care plans, pharmacy benefit managements and private insurers.
"Advantage Pharmacy also used marketers to recruit corrupt doctors to write fraudulent prescriptions and pay beneficiaries receiving compound medications," according to the complaint.
One of those marketers is listed as Total Care Marketing, which was formed around September 2012, with members Hope Thomley and Walters.
The complaint's allegations details: "Walters owned an approximately 40 percent interest. Total Care Marketing served as the exclusive marketer for Advantage Pharmacy, receiving kickbacks of approximately 50 percent of all funds paid to Advantage Pharmacy by health insurance providers for compound medications."
The documents alleged that Randy Thomley and C. Smith formed Advantage Marketing, which was a marketer for Advantage Pharmacy, working under Total Care Marketing.
Advantage Pharmacy is alleged to also use marketers to pay the kickbacks to health care plan beneficiaries.
"With regard to the prescriptions for Randy Thomley's relatives, for example, Advantage Pharmacy paid the relatives by routing money through United Business Ventures, a business entity of which Hope and Randy Thomley were members, and Thomley Christmas Tree Farm, LLC, a business that Randy inherited from his father," according to the allegations.
"In total, three different health care providers wrote prescriptions for Randy Thomley's relatives: an oral surgeon, a nurse practitioner, and an OB/GYN," according to the filing.
Detailed Fraud allegations:
- Court documents allege that between June 2012 and February 2016, overall Advantage Pharmacy was paid at least $155,444,668 for compound medications by various federal health care plans, pharmacy benefit managements and private insurers.
- Advantage was allegedly paid at least $39,154,000 by TRICARE for compound medications.
- Advantage allegedly submitted claims to the U.S. Postal Service for over $1.2 million.
- Advantage allegedly billed private insurers and was paid $109,581,673 for compound prescriptions between February 2013 and December 2015.
"Throughout the scheme to defraud, World Health, Advantage Pharmacy, and Medworx used numerous people, business entities, trusts, shell companies, financial institutions, and accounts to transfer fraud proceeds, launder illegal funds, and promote the ongoing fraud," according to the allegations in the complaint.
In January 2016, members of the Federal Bureau of Investigation, Mississippi Bureau of Narcotics, Internal Revenue Service and multiple other state agencies raided three businesses related to pharmacies in the Hub City, which included Advantage Pharmacy.
Those raids kicked-off others in multiple states including Utah, Alabama and Florida as well as other locations across Mississippi.
These are details of the civil complaint filed by the U.S. government. No criminal charges have been filed at this time in federal court.