Dimondale man draws prison term for defrauding MSU in health care scheme
GRAND RAPIDS – A Dimondale man has been sentenced to federal prison for participating in a health care fraud scheme that victimized Michigan State University.
Daniel Brown admitted soliciting a local doctor to sign prescriptions for what the government called expensive and medically unnecessary compounded pain creams and patches for MSU employees, the U.S. Attorney's Office said in a news release.
Mississippi pharmacies paid Brown – a pharmaceutical sales representative – for directing prescriptions to them, then charged MSU's health plan $2,000 to $3,000 per prescription, the government said.
Brown cooperated with the prosecution of pharmacy operators held criminally liable for more than $200 million in claims paid for "medically unnecessary compounded medications resulting from illegal kickbacks," the attorney's office said. The kickbacks were paid to sales representatives and doctors across the U.S.
The U.S. Attorney's Office indicated about $1.26 million of those claims were connected to MSU's health plan.
Brown's attorney, Mike Nichols, said Brown helped bring down a fraud ring originating in Mississippi.
"People who should have been charged were not charged, and Dan is stuck with all of that restitution, despite his less-than-supervisory role in this matter," Nichols said. "Yet, he is not bitter. He is looking forward to getting through his time in custody and making the most of the rest of his life."
The Mississippi pain cream scheme began unfolding in 2012 and involved a massive fraud involving high-priced pain creams and other medications.
Marketers solicited pharmacists and medical professionals to prescribe the medications in exchange for bribes or kickbacks. Some even signed up family and friends to receive the medications, even though they had no medical need.
"Health care fraud raises costs on consumers, hurts businesses and can subject persons to unnecessary treatment," U.S. Attorney Mark Totten said in the release.
U.S. District Judge Robert Jonker sentenced Brown last week to one year and one day in prison for health care fraud conspiracy.
Brown also will have to spend three years on supervised release after leaving prison and pay more than $1.26 million in restitution.
The case was investigated by the FBI, the Department of Health and Human Services, Office of Inspector General, Michigan State Police and Blue Cross Blue Shield of Michigan's Corporate and Financial Investigations Unit, officials said.
Contact Ken Palmer at kpalmer@lsj.com. Follow him on Twitter @KBPalm_lsj.
This article originally appeared on Lansing State Journal: Man sent to prison for health care scheme that defrauded Michigan State University
