CAMDEN — A federal grand jury returned a 33-count indictment last week charging three individuals, including a Somers Point doctor and an advanced practice nurse, with defrauding New Jersey state health benefits programs and other insurers out of more than $6 million.
They allegedly did that by submitting fraudulent claims for medically unnecessary prescriptions, U.S. Attorney Craig Carpenito announced. A fourth individual, a Mt. Laurel doctor, pleaded guilty to signing four false prescriptions for patients he never met.
Dr. Brian Sokalsky, 42, of Margate, a sports medicine physician with an office in Somers Point, and Vincent Tornari, 46, of Linwood, were charged with conspiracy to commit health care fraud and wire fraud. Sokalsky was charged with a second conspiracy to commit health care fraud and wire fraud.
Ashley Lyons-Valenti, 63, of Swedesboro, and Tornari were charged with a third conspiracy to bribe Lyons-Valenti and deprive her patients and employer of her honest services. Sokalsky and Tornari also were each charged with individual acts of health care fraud and wire fraud, and Lyons-Valenti was charged with individual acts of wire fraud and five false statement counts. Lyons-Valenti was also charged with obstruction of justice for tampering with a grand jury witness.
Northfield man guilty in $50 million health fraud
A week earlier, a Northfield man admitted leading the conspiracy that defrauded New Jersey health benefits programs and other insurers out of more than $50 million, U.S. Attorney Craig Carpenito announced.
William Hickman, 44, pleaded guilty by videoconference before U.S. District Judge Robert B. Kugler to one count of conspiracy to commit health care fraud and wire fraud and one count of conspiracy to commit money laundering.
“Properly prescribed medicines can be a vital part of a patient’s treatment, but they can also be costly,” Carpenito said. “This defendant orchestrated an elaborate scheme to submit prescriptions for unnecessary compounded medications on behalf of patients who had never seen a doctor. He did so to steal millions of dollars from medical health benefits systems that were intended to help employees get the treatments they needed and deserved.”
“This defendant made millions of dollars by enlisting patients and exploiting their medical insurance plans at the expense of New Jersey taxpayers,” Acting FBI Special Agent in Charge Douglas Korneski, Newark Division, said. “The FBI is committed to bringing to justice any profiteer who pursues fraud as an occupation with public monies as their paycheck.”
Hickman was charged in March 2019 along with Brian Pugh, Thomas Schallus, John Sher, Thomas Sher and Christopher Broccoli. Charges remain pending against those defendants, and their trial is scheduled to commence Sept. 21, 2020.
The Sokalsky, Tornari and Lyons-Valenti cases are assigned to Kugler. The indicted defendants were to appear by videoconference before U.S. Magistrate Judge Joel Schneider.
According to the indictment :
Compounded medications are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compounded drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredient.
The conspirators recruited individuals in New Jersey to obtain very expensive and medically unnecessary compounded medications from a Louisiana pharmacy, identified in the indictment as “Compounding Pharmacy 1,” and a Pennsylvania pharmacy, identified in the indictment as “Compounding Pharmacy 2.” The conspirators learned that certain compound medication prescriptions — including pain, scar, antifungal and libido creams, as well as vitamin combinations — were reimbursed for thousands of dollars for a one-month supply.
The conspirators also learned that some New Jersey state and local government and education employees, including teachers, firefighters, municipal police officers and State Police troopers, had insurance coverage for these particular compound medications. An entity referred to in the indictment as the “Pharmacy Benefits Administrator” provided pharmacy benefit management services for the State Health Benefits Program, which covers qualified state and local government employees, retirees, and eligible dependents, the School Employees’ Health Benefits Program, which covers qualified local education employees, retirees, and eligible dependents, and other insurance plans. The Pharmacy Benefits Administrator would pay prescription drug claims and then bill the State of New Jersey or the other insurance plans for the amounts paid.
In the first charged conspiracy, Matthew Tedesco, of Linwood, who previously pleaded guilty to conspiracy to commit health care fraud, had an arrangement with Sokalsky — if Tedesco sent new patients to Sokalsky’s medical practice, Sokalsky would prescribe Compounding Pharmacy 1 medications for the patients. Tedesco, of Linwood, received a percentage of the amount that Compounding Pharmacy 1 received for prescriptions obtained by Tedesco and his associates. Tedesco and his conspirators recruited public employees and others covered by the Pharmacy Benefits Administrator to agree, in exchange for money, to obtain compounded medications from Compounding Pharmacy 1. Tedesco sent the recruited individuals to Sokalsky and often tipped him off that they were coming. Sokalsky prescribed Compounding Pharmacy 1 medications for the patients, including medications that patients did not need or discuss with him. Sokalsky profited by billing insurance for over 30 new patients.
The completed prescriptions were faxed to Compounding Pharmacy 1, which filled the prescriptions and billed the Pharmacy Benefits Administrator. The Pharmacy Benefits Administrator paid Compounding Pharmacy 1 more than $5 million for compounded medications prescribed by Sokalsky.
The indictment charges Sokalsky and Tornari with a similar scheme to write fraudulent prescriptions for Compounding Pharmacy 2. Tornari’s company had an agreement with Compounding Pharmacy 2 to receive 50 percent of the insurance payment for prescriptions they arranged. Tornari then hired Northfield resident Mark Bruno to find patients who would agree to receive Compounding Pharmacy 2 medications in exchange for cash payments. Bruno pleaded guilty in 2019 to conspiracy to commit health care fraud for his participation in the scheme. Tornari had Sokalsky agree to write Compounding Pharmacy 2 prescriptions for new patients sent to him. Bruno found patients and sent them to Sokalsky, often after letting Sokalsky know that they were coming. Sokalsky wrote Compounding Pharmacy 2 prescriptions that the patients did not need or discuss with Sokalsky, sometimes without even seeing the patients. These prescriptions cost insurers over $500,000.
In a third charged scheme, Tornari hired Lyons-Valenti’s boyfriend and agreed to pay him commissions on each Compounding Pharmacy 2 prescription that Lyons-Valenti wrote. Lyons-Valenti then started writing Compounding Pharmacy 2 prescriptions and Tornari paid commissions to the boyfriend, who gave Lyons-Valenti half of the commission payments. Lyons-Valenti persuaded her workers and subordinates at her medical office to receive Compounding Pharmacy 2 prescription medications that they did not need, often without giving them a medical examination or recording the prescriptions in their medical records. Lyons-Valenti wrote Compounding Pharmacy 2 prescriptions for which insurance paid over $1.25 million and received over $90,000 in kickbacks in return.
In a fourth scheme, Lyons-Valenti signed five Compounding Pharmacy 1 prescriptions for Judd Holt, who previously pleaded guilty to conspiracy to commit health care fraud for his role in the scheme. On each of the five prescriptions, Lyons-Valenti falsely stated that she had examined the patient’s medical records, conducted a face-to-face examination of the patient, and determined that the prescribed medications were medically necessary, when in fact she had never met or examined any of the five patients.
Lyons-Valenti also was charged with witness tampering for making false and misleading statements to a co-worker who was a federal grand jury witness. Lyons-Valenti called and texted the witness before and after the witness talked to the FBI and before the witness was scheduled to testify in the grand jury. Lyons-Valenti told the witness to tell the FBI that Lyons-Valenti had examined the witness before prescribing medications for the witness, which was false. Lyons-Valenti also falsely told the witness that Lyons-Valenti had never received any money for writing the prescriptions.
The health care fraud and wire fraud conspiracy count with which defendants Sokalsky and Tornari are charged carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense. Each wire fraud count carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense. Each health care fraud count carries a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. The honest services conspiracy count and the false statement counts each carry a maximum penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. The witness tampering charge carries a maximum penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense
The same day as the indictment was announced, Michael Goldis, D.O., 64, who had a medical practice in Stratford, pleaded guilty by videoconference before Judge Kugler to four counts of making false statements relating to health care matters. Goldis faces a maximum penalty on each count of five years in prison and a $250,000 fine.