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AL Pharmacy Owner Gets House Arrest, $2.5M Fine in Medicare Scam
BIRMINGHAM, AL – Rodney Dalton Logan, 63, of Muscle Shoals, Alabama, will spend six months under house arrest and pay a staggering $2.5 million fine after being convicted of obstructing a federal Medicare audit. The owner of Leighton Pharmacy Inc., doing business as Sheffield Pharmacy and Homecare in Sheffield, and Russellville Pharmacy in Russellville, pleaded guilty in August to a single count related to the scheme.
U.S. District Court Judge Virginia Emerson Hopkins handed down the sentence today, also ordering Logan to serve one year of probation, during which he is explicitly prohibited from working as a pharmacist. The case was a joint effort by the FBI, the Department of Health and Human Services Office of Inspector General (HHS-OIG), and the Food and Drug Administration Office of Criminal Investigation (FDA-OCI).
According to court documents, Logan knowingly falsified records to conceal the fact that his pharmacies were billing Medicare for compounded medications made with banned bulk pharmaceutical powders. Medicare’s Part D program specifically prohibits reimbursement for such practices. Logan’s pharmacies, operating as both compounding and retail locations, were selling these prescriptions to patients across Alabama and other states, raking in illicit profits.
The scam involved a clever, but ultimately unsuccessful, attempt to deceive CVS/Caremark Inc., the auditor for Medicare Part D. Instead of billing for bulk powders, Logan directed Sheffield Pharmacy to submit falsified documents claiming they were using tablet or capsule forms of the ingredients – a blatant attempt to skirt the rules. Acting U.S. Attorney Robert O. Posey was blunt: “This defendant falsified documents so that his businesses could keep money improperly billed to Medicare.”
“Medicare is the federal health insurance program for people 65 and older, and for people with disabilities,” Posey added. “I applaud the work of the investigative agencies and the prosecutors in this office who have worked at length to bring this defendant to justice.” Assistant U.S. Attorney Chinelo Diké-Minor and Trial Attorney William S.W. Chang of the Justice Department’s Criminal Division Fraud Section secured the conviction and sentencing.
Logan, a registered pharmacist, now faces a future barred from his profession and saddled with a crippling financial penalty. The case serves as a stark warning: attempts to defraud the Medicare system will be met with swift and severe consequences. The investigation remains ongoing to determine if additional parties were involved in the fraudulent scheme.
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Key Facts
- State: Alabama
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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