AP NEWS

Another man pleads guilty in huge Mississippi pharmacy fraud

March 26, 2019

HATTIESBURG, Miss. (AP) — Another Mississippi man charged in a fraud case that federal prosecutors say reaped more than $200 million from a federal military health insurer and others has pleaded guilty.

Glenn Doyle Beach of Sumrall pleaded guilty Tuesday before U.S. District Judge Keith Starrett in Hattiesburg to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering and tax evasion.

Beach, 46, was an owner and manager of Advantage Pharmacy. Prosecutors say pharmacists there concocted recipes for pain or scar creams that they would make by hand. Such compounded medications are typically tailored to the needs of an individual patient. But in this case, pharmacists tailored them for maximum reimbursement, using expensive ingredients “without regard to the individual needs of the patients,” prosecutors said.

Starrett on Tuesday also sentenced former Advantage Pharmacy marketing representative Jay Schaar of Biloxi to 27 months in prison for his role in the scheme. Starrett ordered Schaar to pay $2.2 million in restitution.

Marketers would get health care providers to prescribe the creams. The marketers would sometimes pay prescribers kickbacks that are illegal under federal law, and the prescribers would sometimes write orders for the patients without examining them, according to prosecutors. Pharmacies would often cover patient co-payments in violation of health insurance rules.

The scheme targeted people insured by TRICARE, which covers military members, their families, retirees and some National Guard members and reservists. Prosecutors have said Advantage Pharmacy took in $192 million in revenue from TRICARE alone over several years.

Beach also admitted to faking a paper trail to mislead insurance auditors and working to launder millions in proceeds to conceal the money and evade taxes. He’s the 13th person to plead guilty in the scheme since 2017. Two people whom prosecutors have previously identified as central members of the scheme — Chad Barrett and Wade Walters — have not yet been charged. Walters appeared in federal court in San Diego earlier this month to plead guilty on behalf of his company, CFK. The company was convicted of one count of conspiracy to commit false claims, was fined $25,000 and ordered to repay almost $622,000.

Beach had been scheduled to go on trial Tuesday on a 16-count indictment. Instead, he waived indictment and pleaded guilty to two new charges, with prosecutors dropping the old charges. Beach is agreeing to forfeit cash and property worth $9 million.

He’s scheduled for sentencing on July 2.