March 29, 2023
CAMDEN, N.J. – A doctor was sentenced yesterday to 15 months in prison, three years of supervised release and ordered to pay restitution of $1.9 million and forfeiture of $54,000 for his role in two separate conspiracies to defrauding New Jersey state health benefits programs and accepting kickbacks in exchange for referring laboratory work. Dr. Daniel Oswari, 51, of Bordentown, New Jersey, pleaded on Dec. 16, 2019, in Camden federal court to two counts of an indictment charging him with conspiracy to commit health care fraud and wire fraud and conspiracy to violate the Anti-Kickback Statute and the Travel Act.
Photo by Sora Shimazaki on Pexels.com
Prior press relase from Monday, December 16, 2019:
Doctor and Pharmaceutical Representative Admit Health Care Fraud Conspiracies Targeting State Health Benefits Programs
CAMDEN, N.J. – A Trenton doctor today admitted his role in two separate conspiracies for defrauding New Jersey state health benefits programs and accepting kickbacks in exchange for referring laboratory work, U.S. Attorney Craig Carpenito announced. A pharmaceutical representative admitted his role in a separate health care fraud conspiracy and to obstructing justice by telling witnesses to lie to the grand jury investigating the scheme.
Dr. Daniel Oswari, 48, of Bordentown, New Jersey, pleaded guilty today before U.S. District Judge Robert B. Kugler in Camden federal court to two counts of an indictment charging him with conspiracy to commit health care fraud and wire fraud (Count One) and conspiracy to violate the Anti-Kickback Statute and the Travel Act (Count 23). Mark Bruno, 45, of Northfield, New Jersey, also pleaded guilty before Judge Kugler to an information charging him with conspiracy to commit health care fraud and obstruction of justice.
Oswari was charged in October 2019 along with Steven Monaco, Michael Goldis, and Aaron Jones, and charges remain pending against those three defendants.
According to documents filed in these cases and statements made in court:
Compounded medications are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compounded drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredient.
Between January 2014 and April 2016, Oswari participated in a conspiracy that discovered that certain insurance plans paid for certain prescription compound medications – a including vitamins and pain creams – from a Louisiana pharmacy, identified in the indictment as the “Compounding Pharmacy 1,” and a Pennsylvania pharmacy, identified in the indictment as “Compounding Pharmacy 2.” The conspirators targeted patients with these insurance plans that provided coverage for the compound medications, particularly New Jersey state and local government and education employees. An entity referred to in the indictment as the “Pharmacy Benefits Administrator” provided pharmacy benefit management services for the State Health Benefits Program, which covers qualified state and local government employees, retirees, and eligible dependents, the School Employees’ Health Benefits Program, which covers qualified local education employees, retirees, and eligible dependents, and other insurance plans. The Pharmacy Benefits Administrator paid prescription drug claims and then billed the State of New Jersey or the other insurance plans for the amounts paid.
Oswari and members of his staff tried to persuade patients to receive the prescription compound medications, even if the patients did not have a medical necessity for the medications. Oswari signed printed prescription forms from Compounding Pharmacies 1 and 2 that had pre-selected the highest number of refills to obtain the highest possible insurance reimbursement. Oswari signed some prescriptions without seeing or evaluating the individuals, including for individuals who were not his patients. Oswari signed approximately 285 prescriptions for compounded medications, and the Pharmacy Benefits Administrator paid Compounding Pharmacies 1 and 2 approximately $1.9 million for the prescriptions he signed. In exchange for signing the prescriptions, Oswari received cash kickbacks.
Oswari also pleaded guilty to a separate conspiracy to take kickbacks for referring laboratory work and signing prescriptions. Oswari had a laboratory hire his medical assistant as a phlebotomist. The medical assistant continued to work for Oswari, but laboratory paid her salary for over two years. In return, Oswari referred his blood and urine samples to the laboratory for testing. This lab work was insured by Medicare, New Jersey Medicaid, and other insurance companies.
Bruno worked for a company that marketed compounded medications and received a percentage of the insurance payments. Bruno introduced a doctor to the company and received a percentage of the payments for prescriptions that the doctor wrote. Bruno and others paid the doctor to reward him for signing prescriptions. Bruno recruited individuals covered by New Jersey state insurance plans because he knew that those plans paid thousands of dollars for certain compounded medications. Bruno paid several of these individuals to see his doctor and receive prescriptions for compounded medications. Bruno received $68,872 from the company and caused $524,935 in losses.
Bruno learned in 2018 that the federal grand jury was investigating him. In 2019, two individuals paid by Bruno to receive compounded medications told him that they had received subpoenas to testify in the grand jury, and another two told Bruno that they were contacted by the FBI. Bruno told the first two to lie in the grand jury and deny that he paid them. Bruno told the other two to tell the FBI that he had not paid them.
The health care fraud and wire fraud conspiracy count to which Oswari pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense. The kickbacks conspiracy count to which Oswari also pleaded guilty carries a maximum penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. The heath care fraud conspiracy and obstruction of justice charges to which Bruno pleaded guilty each carry a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gain or loss from the offense.
Sentencing for Oswari is scheduled for March 23, 2020, and sentencing for Bruno is scheduled for March 24, 2020.
U.S. Attorney Carpenito credited agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; IRS – Criminal Investigation, under the direction of Special Agent in Charge John R. Tafur in Newark; and the U.S. Department of Labor, Office of Inspector General, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka, with the investigation leading to the guilty pleas. He also thanked the Division of Pensions and Financial Transactions in the State Attorney General’s Office, under the direction of Attorney General Gurbir S. Grewal and Division Chief Aimee Nason, for its assistance in the investigation.
The government is represented by Assistant U.S. Attorneys R. David Walk Jr. and Christina O. Hud of the U.S. Attorney’s Office in Camden.
The charges and allegations contained in the indictment against Monaco, Goldis, and Jones are merely accusations, and the defendants are presumed innocent unless and until proven guilty.