TRICARE Scheme Nets 10: $100M Fraud Uncovered

DALLAS – A brazen scheme to bilk TRICARE, the health insurance program for military families, out of a staggering $100 million has landed ten individuals in federal custody. Special agents with the Federal Bureau of Investigation and the Defense Criminal Investigative Service (DCIS) moved this week, arresting nine defendants and accepting the surrender of a tenth. The charges, stemming from a 35-count superseding indictment unsealed today in Dallas, paint a picture of calculated greed preying on those who serve.

U.S. Attorney John Parker of the Northern District of Texas didn’t mince words, stating, “Exhaustive investigative work by FBI and DCIS special agents and investigators not only led to today’s arrests, but to the identification and seizure of millions in assets that these defendants derived from their participation in this massive scheme that caused the TRICARE health insurance program—designed for our military personnel, veterans and their families—to suffer more than $100 million in actual losses.” This wasn’t just about money; it was a direct hit to the resources meant for those in uniform and their loved ones.

The investigation, a joint effort between the FBI’s Dallas field office and DCIS, reveals a conspiracy centered around the fraudulent prescription of compounded pain and scar creams. Acting SAC Michael A. Costanzi of FBI Dallas emphasized the importance of such partnerships: “Today’s arrests helped to alleviate the burden on the American taxpayers from an organized group determined to commit fraud within the healthcare industry, principally, the TRICARE system.” DCIS Special Agent in Charge Janice M. Flores added a stark warning: “Fraud and abuse by pharmacies and medical providers… is a significant threat to the DoD health care system.”

The indictment names the following defendants: Dr. Walter Neil Simmons, 47, of Mesa, Arizona; Dr. William F. Elder-Quintana, 50, of El Paso, Texas; Jeffrey Eugene Fuller, 51, of Dallas, Texas; Andrew Joseph Baumiller, 37, of Dallas, Texas; Jeffry Dobbs Cockerell, 61, of Houston, Texas; Steven Bernard Kuper, 43, of Burleson, Texas; Ravi Morisetty, 42, of Irving, Texas; Joe Larry Straw, 46, of Frisco, Texas; Luis Rafael Rios, 50, of Killeen, Texas; and Michael John Kiselak, 49, of Southlake, Texas. Fuller and Baumiller, the owner and President, respectively, of Trilogy Pharmacy, are currently detained pending pre-trial hearings scheduled for this Thursday, October 20, 2016.

Adding another layer of grime, two previously charged defendants, Richard Robert Cesario, 49, of Plano, Texas, and John Paul Cooper, 47, of Southlake, Texas, remain in federal custody. Judge Horan previously determined that Cooper and Cesario had expressed intent to harm associates and flee to Costa Rica if prosecuted – a chilling detail suggesting a willingness to escalate to protect their ill-gotten gains. The scheme allegedly ran from approximately May 2014 to mid-February 2016, fueled by kickbacks and a callous disregard for the system they were exploiting.

The investigation continues, with authorities working to recover the stolen funds and bring all those involved to justice. This case serves as a grim reminder that even programs designed to protect our military are vulnerable to predatory criminals willing to exploit them for profit. Grimy Times will continue to follow this case and provide updates as they become available.