3 East Tennesseans sentenced to prison in multimillion-dollar prescription fraud scheme
The scheme involved altering and forging forms that were later submitted for drug reimbursement.
KNOXVILLE, Tenn. (WVLT) - Three people from East Tennessee will be spending time behind bars for their role in a multimillion-dollar prescription fraud scheme.
The U.S. Department of Justice said on June 11, a judge sentenced Barbara Smith, 75, of Powell, to 37 months in prison and one year of supervised release. Smith was also ordered to pay $4,810,878 in restitution.
The judge also previously sentenced Smith’s co-defendants, Jared Grant Riddle, 47, of Clinton, and Brian Woods, 48, of Dandridge. The DOJ said Both men received 33 months in prison and three years of supervised release. Riddle was ordered to pay $8,687,531.89 in restitution and Woods was ordered to pay $7,365,897.89.
According to court documents, from May 2018 to October 2020, United Apothecary, LLC operated six retail pharmacies, doing business as Riddle Drugs or Riddle Express Pharmacy.
Prosecutors said Grant Riddle, who was a licensed pharmacist, created a formulary, or list, that contained certain medications based on high reimbursement values.
The DOJ said Woods marketed that list to local pain clinics, including a Knoxville-area pain clinic and primary care facility where Smith worked as an office manager. Prosecutors said Woods provided stacks of blank lists to Smith and clinic providers, then paid Smith cash for signed forms.
According to authorities, Woods and Smith later altered the signed lists, adding check marks next to medications that were not prescribed and increasing the number of refills.
They then used blank forms to create fully forged lists, including writing in patient names, adding medications and refills and forging providers’ signatures.
The DOJ said the forged forms were submitted for reimbursement, resulting in drug plans and pharmacy benefits managers paying about $7,365,897.89, including about $4.8 million from Medicare Part D.
As part of plea agreements, the DOJ said Smith, Riddle and Woods each pleaded guilty to conspiracy to commit health care fraud.
“These sentencings underscore the serious consequences faced by individuals who exploit federal health care programs for personal gain,” said Special Agent in Charge Kelly Blackmon of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “The Riddles’ scheme diverted valuable taxpayer funds from programs designed to support beneficiaries in need.”
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