Pharma Sales Rep Commits Healthcare Fraud and Criminal HIPAA Violations

A sales representative from a pharmaceutical company has admitted to a conspiracy committing healthcare fraud and wrongfully sharing and getting patients’ protected health information (PHI) in a complex healthcare fraud scheme that involves criminal HIPAA violations.

42-year-old Keith Ritson of Bayville, New Jersey is an ex-pharmaceutical sales agent who marketed compound prescription drugs and other medicines from 2014 to 2016. Compound prescription drugs are specialty medicines that a pharmacist mixes to fulfill the requirements of specific patients. Usually, these are prescribed when a patient cannot take standard medicines for a particular medical ailment, because of an allergy for example. Though not FDA-approved, a physician can legally prescribe compound prescription drugs after determining that standard medicines are not suitable for a specific patient.

Ritson found out that selected health insurance programs that have pharmacy benefit management services paid for compound prescription drugs issued by Central Rexall Drugs, Inc, a Louisiana pharmacy. The pharmacy benefits manager pays the prescription drug claims and then bills the state of New Jersey and other insurance companies for the paid amounts. Ritson together with his conspirators found a number of insurance providers would repay thousands of dollars monthly for several compound prescription drugs. So, Ritson would get a share of the money the pharmacy gets from the pharmacy benefits administrator for arranging any prescription medications.

Those who belong to insurance programs that paid for the compound medications would be hired to get the medicines, even though they weren’t medically required, and Ritson himself likewise obtained the medicines. Ritson got the patients from the clinical practice of Dr. Frank Alario. Dr. Alario admitted his part in this healthcare fraud scheme at the beginning of October.

Ritson wasn’t related to Alario’s medical practice, hence, was not authorized to view or get the PHI of the patients of Dr. Alario. However, Dr. Alario gave Ritson access to his clinic and patient files to see which patients got insurance policies that would pay for the medications. Afterward, Ritson would tag patients to let Dr. Alario know the patients that can be prescribed with compound medications. In certain cases, Ritson was there while Dr. Alario examined the patient, so the patients got the feeling that he was an employee or affiliated with the medical practice.

Ritson utilized patient data to complete prescription forms and Dr. Alario would subsequently approve the prescriptions. Ritson gets a commission on those compound prescription medications. On October 19, 2022, Ritson professed to one count of conspiring to wrongfully disclose and acquire the PHI of patients and one count of conspiracy to commit health care fraud. His sentencing will be on Feb. 7, 2023. For the healthcare fraud count, he will face a maximum of 10 years in prison and a $250,000 penalty. For the criminal HIPAA violation, he will face a maximum of one year in prison and a $50,000 penalty. For his role in this healthcare fraud scheme, Dr. Alario faces a maximum of one year in prison and a $50,000 penalty.

Other people involved in this healthcare fraud are three Central Rexall Drugs executives: 60-year-old Trent Brockmeier of Pigeon Forge, Tennessee; 43-year-old Christopher Kyle Johnston of Mandeville, Louisiana; and 54-year-old Christopher Casseri of Baton Rouge, Louisiana They will face charges for their part in the scheme in a 24-count indictment which includes healthcare and wire fraud. 39-year-old Hayley Taff of Hammond, Louisiana, a pharmacy employee, also pleaded guilty to conspiracy to commit healthcare fraud and will face his sentence on March 13, 2023.