N.J. U.S. Attorney: Pharmacy Owner and Administrator Admit Roles in Multimillion-Dollar Health Care Fraud and Kickback Scheme

TRENTON, New Jersey, Feb. 8 -- The office of the U.S. Attorney for the District of New Jersey issued the following news release on Feb. 7, 2024:

The co-owner and the administrator of a Union City, New Jersey, pharmacy today admitted their roles in conspiracies to defraud pharmacy benefit managers and health care benefit providers, including Medicare and Medicaid, of more than $65 million and to pay kickbacks and bribes to health care professionals and their staffs in exchange for referrals of prescriptions, U.S. Attorney Philip R. Sellinger announced.

Samuel "Sam" Khaimov, 52, and his wife, Yana Shtindler, 48, both of Glen Head, New York, pleaded guilty before U.S. District Judge Michael A. Shipp in Trenton federal court. Khaimov pleaded guilty to two counts of a superseding indictment charging him with conspiring to commit health care fraud and conspiring to violate the federal anti-kickback statute. Shtindler pleaded guilty to conspiring to commit health care fraud. Khaimov and Shtindler's codefendants, Ruben Sevumyants of Marlboro, New Jersey, and Alex Fleyshmakher of Morganville, New Jersey, have already pleaded guilty to counts in the superseding indictment and are awaiting sentencing.

"These defendants admitted taking part in an elaborate and years-long scheme to use their specialty pharmacy to rip off Medicare, Medicaid and private insurers. They paid bribes, kickbacks, set up phony jobs in doctors' offices. They took reimbursements for medications that never dispensed and falsified records, defrauding insurers via pharmacy benefits managers of more than $65 million. Protecting the integrity of our healthcare system at all levels is a top priority for this office. We will continue to work relentlessly with our enforcement partners to ensure those who commit healthcare fraud or undermine the integrity of medical decision-making through bribes and kickbacks face justice, like the defendants in this case."

U.S. Attorney Philip R. Sellinger

"The impacts of health care fraud are far-reaching," FBI - Newark Special Agent in Charge James E. Dennehy said. "These schemes not only put a tremendous amount of strain on our resources, but also have significant impacts on insurance costs and chip away at the foundation of trust we have in our health care providers. Bottom line, the conspirators in this case put personal greed above quality patient care. While we are happy to see Khaimov, Shtindler and their crew face justice, we will remain at work for the American public and continue seeking out and shutting down these scams."

"The defendants' role in the conspiracies to defraud pharmacy benefit managers, health care benefit providers, and taxpayers via Medicare and Medicaid of more than $65 million is deplorable," Tammy Tomlins, Special Agent in Charge of the IRS - Criminal Investigation Newark Field Office, said. "IRS - Criminal Investigation and our law enforcement partners will continue to pursue those who knowingly violate the law and undermine the integrity of our federal healthcare system."

"The additional pleas in this investigation demonstrate that HHS-OIG will continue to hold accountable individuals who exploit federal health care programs for their own greed," Naomi Gruchacz, Special Agent in Charge with the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), said. "Pharmacy employees who submit fraudulent claims to Medicare and Medicaid and bribe medical providers to induce prescriptions put health care benefits for vulnerable populations at risk."

According to documents filed in this case and statements made in court:

The Prime Aid Pharmacies - now closed - operated as "specialty pharmacies" out of locations in Union City and the Bronx, New York. As specialty pharmacies, they processed expensive medications used to treat various conditions, including Hepatitis C, Crohn's disease, and rheumatoid arthritis. Khaimov was a co-owner of Prime Aid Union City and the lead pharmacist of Prime Aid Bronx. Shtindler was Prime Aid Union City's administrator. Sevumyants was Prime Aid Union City's operations manager. Alex Fleyshmakher worked at Prime Aid Union City and was an on-paper owner of Prime Aid Bronx. His father, Igor Fleyshmakher, a co-owner of Prime Aid Union City, pleaded guilty to separate federal charges.

Initially, the Prime Aid Pharmacies obtained retail network agreements with several pharmacy benefits managers (PBM), which allowed them to receive reimbursement payments for prescription medications, including specialty medications. PBMs acted as intermediaries on behalf of Medicare, Medicaid, and other health benefit providers, so when one of the Prime Aid Pharmacies received a prescription, the pharmacy would typically submit a claim for reimbursement to the PBM that represented the beneficiary's drug plan.

Starting in 2009, to obtain a higher volume of prescriptions, Khaimov, Sevumyants, Alex Fleyshmakher, and other Prime Aid employees paid bribes to doctors and doctors' employees to induce the doctors and their staffs to steer prescriptions to the Prime Aid Pharmacies. The bribes included payments by cash, check, and wire transfers, as well as expensive meals and other things of value. Another method of bribery involved paying an employee to work inside a doctor's office.

Prime Aid Union City - at the direction of Sevumyants, Shtindler, and Khaimov - also engaged in the pervasive and fraudulent practice of billing health benefit providers and PBMs for medications that were never provided to patients. While Prime Aid generally provided medications for initial prescriptions it received, it systematically billed for refills for those same medications without ever dispensing them to patients. According to the superseding indictment, from 2013 through 2017, Prime Aid Union City received at least $65 million in reimbursement payments from Medicare, Medicaid, and private health benefit providers for medications that Prime Aid Union City not only failed to give patients, but that Prime Aid Union City also never even ordered or had in stock at the pharmacy.

Over time, PBMs conducted routine audits of Prime Aid Union City and discovered its practice of billing but not dispensing medications. In response to these audits, Shtindler instructed Prime Aid employees to falsify records submitted to the PMBs. In addition, Sevumyants, with Shtindler's knowledge and approval, forged shipping records of a private commercial shipping company to make it appear as if medications were shipped to the patients when, in fact, they were not.

The conspiracy to commit healthcare fraud count is punishable by a maximum of 10 years in prison. The conspiracy to pay illegal kickbacks is punishable by a maximum of five years in prison. Both counts are also punishable by a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. Sentencing is scheduled for June 13, 2024.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins in Newark; special agents of the Department of Health and Human Services-Office of Inspector General, under the direction of Special Agent in Charge Naomi Gruchacz; the N.J. Office of the Insurance Fraud Prosecutor, Medicaid Fraud Unit, under the direction of Interim Insurance Fraud Prosecutor Al Garcia, and the N.J. Office of the State Comptroller, under the direction of Acting Comptroller Kevin Walsh, with the investigation leading to today's guilty pleas.

The government is represented by Assistant U.S. Attorneys Martha K. Nye of the U.S. Attorney's Office in Trenton and Jordann R. Conaboy and Aaron L. Webman of the Opioid Abuse Prevention and Enforcement Unit of the U.S. Attorney's Office in Newark.

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Original text here: https://www.justice.gov/usao-nj/pr/pharmacy-owner-and-administrator-admit-roles-multimillion-dollar-health-care-fraud-and