NEW YORK—The ease of obtaining forged prescriptions for drugs like OxyContin has made Medicaid fraud a very lucrative business at the expense of taxpayers. Kings Country District Attorney Charles Hynes announced the indictment of 35 people charged with stealing more than $100,000 from the Human Resources Administration (HRA) on Thursday.
“Medicaid is an important program for the low-income people it is intended to support. It is not a cash cow for profit-hungry drug dealers,” Hynes said.
Hynes says that one of the cases, involving 12 defendants, was essentially a conspiracy where three people took over a doctor’s office to write fake prescriptions to sell on the streets.
Of the three, Jennifer Garrastegui and Lindsay Ortiz worked in a doctor’s office on Grand Street in Bushwick, where they would forge OxyContin prescriptions. Their other nine conspirators would fill the prescriptions from pharmacies across Brooklyn, and Sandra Quinones, who worked in a pharmacy, would sell pills for $20 each on the street. All 12 are being charged with Grand Larceny In the Second Degree, which has a maximum prison sentence of 15 years.
The three heading the scheme face additional charges of Conspiracy in the Fourth Degree, Forgery in the Second Degree, and Criminal Use of a Public Benefit Card.
They made about $200,000 from the “conspiracy,” which cost Medicaid $96,000.
In a separate case, Jonathan James was selling HIV medication, Atripla, to a “recruiter” for about $1,200 total, over the course of his fraud. A bottle of Atripla costs Medicaid $1,500, but sells on the street for only about $150 per bottle.
Hynes says that the worst part of this welfare fraud is not that the criminals are stealing from the government, but these pills are put on the streets, and people are getting addicted.
“Prescription pill abuse [is also at] the heart of several recent violent crimes,” Hynes said. “The crimes put these pills on the street, making them readily available to vulnerable victims. First-time users will often become addicted. Demand rises and the availability of the product is as close as your neighborhood pharmacy.”
Phil Schaffroth, of the Bureau of Fraud Investigation’s Prescription Drug Division, says that across the country, Medicaid recipients are being approached by people who see this as a way to profit. The black market for prescription drugs has been thriving to the point where people who actually need their medication often sell it for quick cash instead.
“These prescriptions are stolen because people are able to dress up as doctors; they wear lab coats and go into offices and swipe the pads,” Schaffroth said. They also dress up or approach cleaning crews to obtain prescription pads, and often get people in clinics and offices to write these prescriptions for them.
These prescriptions range on average from $300 to $1,300, and are then sold to “non-control men,” who deal non-controlled medication, which is almost “anything but painkillers.”
“These medications are then sold to stash houses, where they’re repackaged and eventually sold back to pharmacies. [Taxpayers] are footing the bill. It just goes around in a circle again,” Schaffer said. “When me or you goes up to pick up our legitimate medication, sometimes we’re picking up medication that’s been picked up from the black market, that’s sometimes expired, remodeled, tampered—that means worse for us. So there’s a whole health risk burden besides the financial burden it’s causing the city.”
Hynes says that since the creation of the Public Assistant Crimes Unit with the help of the HRA in 2000, they’ve investigated and prosecuted nearly $12 million in fraud.
