Physician sentenced in $515M pain cream fraud scheme
Gregory Auzenne, MD, a pain management specialist from Meridian, Mississippi, has been sentenced in connection with a $515 million fraud scheme over pain cream.
Auzenne, who pleaded guilty to a misdemeanor charge of fraudulent failure to disclose information involving federal healthcare programs, was sentenced to five years of probation and ordered to pay a $20,000 fine and $116,623.23 in restitution, Clarion Ledger reported.
Auzenne pleaded guilty for his role in the scheme, which billed TRICARE and other healthcare benefits providers for more than $515 million in Mississippi. The scheme also involved another pharmacist, Marco Moran, who borrowed $40,000 from Auzenne to open Custom Care Pharmacy, which filled hundreds of prescriptions for high-priced pain cream, supplements and other high-priced medications. Auzenne originally denied that he signed any of the 200 prescriptions he wrote for the medications and creams.
While the pain cream scheme began in Mississippi, it was a massive operation that defrauded TRICARE and other health payors out of $1.5 billion nationwide. The scheme hinged on providers prescribing compounded pain creams and other medications with the highest reimbursement amounts, rather than based on patients’ individual needs. Many of the prescriptions were fraudulent, with doctors not even seeing the patients in some cases, and in other cases the creams were not medically necessary.
Auzenne’s guilty plea was for not notifying authorities of the suspicious activity of Moran, who himself pleaded guilty for his involvement and was sentenced to 10 years in prison. While Auzenne is avoiding jail time, U.S. District Senior Judge Keith Starrett said his probation period would be shortened even more if all the restitution and fees were paid prior to the five years, Clarion Ledger reported.
Auzenne was originally on the hook for more charges, including violating anti-kickback statutes, wire fraud, conspiracy and making false statements. Ultimately, a jury only found him guilty for making false statements, and the trial for that sentencing was canceled after Auzenne entered a guilty plea. He was originally accused of stealing more than $18 million in the $1.5 billion scheme, and he was one of more than two dozen people charged in the scheme.
Auzenne said in court he has more control over his business after entering private practice. Previously he served with Rush Health Systems, where he said he had less control over day-to-day operations, Clarion Ledger reported.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."