HOUSTON — A Houston man behind a massive Medicare fraud scheme is believed to have made more than $200 million by fraudulently billing patients for medication.
Mohamad Mokbel, 59, was found guilty on 15 charges. He's awaiting his sentence and he could also be ordered to pay up to a total of $4 million in fines and possible restitution in excess of $160 million.
The scheme
Between 2014 and 2021, Mokbel was the head of 4M Pharmaceuticals. The company had 14 pharmacies with straw owners, which means the person's name listed on the property wasn't the person who actually owned the pharmacy.
Mokbel illegally purchased thousands of Medicare beneficiaries for $16 to $40. He paid for their identification number, personal health and physician information and targeted diabetic patients who have to have testing supplies to manage their blood sugar levels.
To maximize his profit, Mokbel had his 4M employees use the beneficiaries' information to run insurance claims to see if Medicare or other insurance plans would cover and reimburse at a high rate for topical creams, Omega-3 pills and other medications that Mokbel intended to sell through 4M pharmacies.
Pre-filled prescription requests would be sent to doctors that appeared to be for diabetic testing supplies with topical creams added at the bottom. They would also have requests for 4M Pharmacy to fill the prescriptions.
"In reality, Mokbel had previously purchased the patient’s personal information, the patient had not selected a 4M Pharmacy and the patient was often unaware the request was being made on their behalf," the United States Attorney's Office said in a release.
Many doctors ended up signing and sending back the prefilled prescriptions to 4M.
Mokbel’s pharmacies shipped out numerous topical creams, often on auto-refill, and excessively billed Medicare, Medicaid and private insurance plans. It's estimated that he made over $200 million as a result of the scheme.
Bribery
Between 2015 and 2020, Mokbel paid nearly $200,000 in bribe payments to an employee of pharmacy benefits manager OptumRx in exchange for favorable treatment.
4M Pharmacy was credentialed and re-credentialed with OptumRx, which allowed them to get into retail network agreements, take part in the Medicare Part D program and submit claims for prescriptions for Medicare beneficiaries.
With the payments, Mokbel also got tips on responding to audits.
Punishment
While he had previously been out on bond, Mokbel was taken into custody as he waited to learn his punishment. He faces up to 20 years for conspiracy to commit mail fraud and health care fraud, 10 years for each of five counts of health care fraud, each of six counts of money laundering and one count of bribery concerning programs receiving federal funds as well as five years for conspiracy to violate the Anti-Kickback Statute and conspiracy to commit bribery.
Sentencing is set for Jan. 7.
