$15M Health Care Fraud: Brothers Convicted of Defrauding Medicare & Medicaid
A federal jury convicted a Michigan pharmacy owner and his brother on Friday for conspiring to commit healthcare fraud and wire fraud. The charges stemmed from an extensive investigation into fraudulent billing practices that impacted Medicare, Medicaid, and Blue Cross Blue Shield of Michigan, according to the Department of Justice (DOJ).
Raad Kouza, a pharmacist from Wayne County, and his brother Ramis Kouza, of Oakland County, were found guilty of orchestrating a scheme between 2010 and 2019 in which they submitted false claims for medications that were never dispensed. The brothers operated five pharmacies in Michigan—ER Drugs, Seaway, Food Town, Rockwood, and St. Paul—through which they falsely billed health care programs for medications they did not have in stock, defrauding the programs of more than $15 million.
Court documents revealed that the brothers consistently claimed reimbursements for prescriptions that they were unable to fill, resulting in overpayments of more than $7 million, including over $1.2 million in Medicaid overpayments. The fraudulent activities were initially uncovered in 2016 during a civil investigation by the Michigan Department of Health and Human Services Office of Inspector General, which found suspicious billing and inventory shortages at the pharmacies. Despite receiving multiple warnings about billing discrepancies, the Kouzas continued their fraudulent practices, eventually prompting a federal criminal investigation.
In addition to the conspiracy charges, Raad Kouza was convicted on an additional count of health care fraud. Both defendants now face up to 20 years in prison for conspiracy, with Raad Kouza facing an additional 10 years for the health care fraud conviction.
