JERMYN, Pa. — A pharmacy in Lackawanna County played a key role in a health care fraud scheme that soaked insurers for hundreds of thousands of dollars in medically unnecessary foot baths, said Gerard Karam, the U.S. Attorney for the Middle District of Pennsylvania.
A federal grand jury seated in Harrisburg returned indictments earlier this month against seven people, including the owner of the Sterling Pharmacy, in Jermyn, where several of the purportedly fraudulent foot bath orders were routed.
Between 2019 and 2020, the conspirators agreed to bill health insurers for expensive prescriptions that patients did not actually need, prosecutors said. That was achieved by steering orders for prescription foot baths through Sterling Pharmacy, which was, on paper, owned by Melissa Driscoll, 43, of East Stroudsburg. One insurance company paid roughly $685,000 in claims, according to the indictment.
Here's how it worked, according to prosecutors:
Two Florida men — Frank Suess, 78, and Victor Velazco, 35 — had people take ownership of pharmacies across the country that became conduits for fraudulent prescription orders. For instance, Driscoll bought the Sterling Pharmacy in 2018 using funds provided by Seuss.
The nominal ownership of pharmacies concealed their involvement, authorities said. Prosecutors said the men received more than $1 million in kickbacks from Driscoll.
A Brooklyn-based podiatrist, Diana Castro, 53, approved hundreds of unnecessary prescription foot bath orders for patients recruited at health fairs in New York and by a diabetic shoe salesman in Scranton. Castro also allegedly used another physician's national provider identifier without their knowledge.
Meanwhile, Sterling Pharmacy also paid kickbacks to MedX Marketing Solutions, under CEO Luis Salgado, 50, of Florida, for the referral of signed foot-bath order forms, authorities said.
Two other people, Warren Pizik, 68, and David Singh, 37, both of Florida, helped Salgado market Sterling Pharmacy's mail-order business and set up out-of-state pharmacy licenses.
Driscoll, Suess, Velazco, Castro, Salgado, Pizik and Singh are all due in a federal court in Harrisburg next month for arraignment on charges alleging they committed health care fraud.
Prosecutors say Suess, Salgado, Driscoll, Velazco and Pizik also conspired to violate the federal anti-kickback statute. Suess, Driscoll and Velazco also conspired to obstruct a criminal investigation by allegedly creating phony business records to high the scheme, authorities said.
This marks the second health care fraud case filed this year against Suess.
In July, a federal grand jury in Illinois returned an indictment alleging that Suess, who owned several small retail pharmacies, submitted fraudulent submissions to various healthcare entities.
