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Miss. pharmacist sentenced for $180 million health care fraud scheme

The long-running fraud, which at least one judge called the largest scam in Mississippi...
The long-running fraud, which at least one judge called the largest scam in Mississippi history, took place between 2011 and 2016.(Storyblocks)
Published: Jan. 26, 2022 at 12:19 PM CST
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HATTIESBURG, Miss. (WDAM) - A Mississippi pharmacist was sentenced Wednesday to serve five years in prison for his part in a multimillion-dollar healthcare fraud scheme.

The conduct resulted in more than $180 million in fraudulent billings, including more than $50 million paid by federal health care programs.

According to court documents, David “Jason” Rutland, 42, of Bolton, a pharmacist and co-owner of various compounding pharmacies, schemed to defraud TRICARE and other healthcare benefit programs by distributing medically unnecessary compounded medications.

Rutland was accused of adjusting prescription formulas to ensure the highest reimbursement without regard for efficacy.

Rutland also was accused of soliciting recruiters to procure prescriptions for high-margin compounded medications and paid those recruiters commissions based on the percentage of reimbursements paid by pharmacy benefit managers and health care benefit programs, including commissions on claims reimbursed by TRICARE.

Those taking part in the scheme, such as pharmacists, doctors, nurses and drug store owners, collected insurance reimbursements and other health plan payments

He also routinely waived and/or reduced copayments to be paid by beneficiaries and members, which included utilizing a purported copayment assistance program to falsely make it appear as if his pharmacy and its affiliate compounding pharmacies had been collecting copayments among other things.

The long-running fraud, which at least one judge called the largest scam in Mississippi history, took place between 2011 and 2016.

Anchored in the Pine Belt, the scheme spread nationwide into California, Utah, Florida and Tennessee.

At the heart of the swindle were expensive, compounded pain creams that were often medically unnecessary.

Rutland pleaded guilty on July 20, 2021, to conspiracy to defraud the United States and solicit, receive, offer and pay illegal kickbacks. In addition, Rutland was ordered to pay restitution and forfeit all assets gained from this scheme.

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