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Arkansas Doctor Found Guilty In $10 Million Kickback Conspiracy

Alexander is a tiny city in the state of Arkansas. As of 2020, the population of Alexander was barely over 3,300. Something pretty big has happened in this small town. As the Eastern District of Arkansas branch of the United States Department of Justice revealed yesterday, Alexander was the location of a multi-million-dollar kickback conspiracy.

According to the DoJ report, 41 year-old Joe David “Jay” May was found guilty in a $10 million scheme involving TRICARE. No less than 22 counts were levied against the Alexander doctor and he was convicted for all of them.

May’s indictment was handed down in January 2020.

The indictment alleged that May signed off on illegitimate prescriptions for pain cream. His objective was to elicit payouts from TRICARE, which is the nation’s health care program for veterans. As part of May’s scheme, a pharmacy promoter paid recruiters to find TRICARE beneficiaries. They were targeted regardless of whether or not they needed the drugs.

The recruiters then paid others to get medical professionals, including May, to approve prescriptions for TRICARE beneficiaries. As a result, TRICARE paid over $12 million for compounded drugs prescribed through the scheme. Evidence at trial showed that May wrote 226 prescriptions over the course of ten months.

TRICARE paid out $4.63 million.

Nearly every prescription was supplied by drug sales representatives, Glenn Hudson and Derek Clifton. They were both charged and have pleaded guilty to their roles in the scheme. Nurse practitioner, Donna Crowder has also pleaded guilty to her participation. According to the DoJ report, May accepted cash bribes that totaled nearly $15,000. He also signed off on the prescriptions without consulting patients and without determining whether or not the prescription was needed.

“One recruiter hosted a meeting at Fisher Armory in North Little Rock,” details the DoJ, “At that meeting, he signed people up for the drugs and offered to pay them $1,000. Thirteen of those patients were routed to Dr. May, who signed each prescription, and this group alone cost TRICARE $370,000. The conspirators learned that reimbursements from TRICARE might fall in May 2015, so April was the last opportunity to profit from the program.”

The report goes on to explain that in the last ten days of April 2015, May signed 59 prescriptions. They resulted in a $1.4 million payout from TRICARE. “During a single 9-week period at the height of the scheme, May deposited $9,925 cash; an FBI forensic accountant testified this was more cash than he deposited in 2014 and 2016 combined,” the DoJ reports.

May faces a hefty prison sentence.

May has been found guilty of wire fraud, mail fraud and falsifying records. He faces up to 20 years imprisonment for these convictions. For being in violation of the anti-kickback statute, May also faces up to 10 years in prison. For conspiracy and making false statements, he faces not more than five years imprisonment.

“In addition to any sentence imposed, May will also serve an added four years for convictions on two counts of aggravated identity theft,” concludes the DoJ, “All offenses of conviction include a potential penalty of not more than a $250,000 fine and not more than three years of supervised release.”

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