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Pharmacies Pay $6.8 Million to Settle False Claims Act Allegations
DermaTran Health Solutions, LLC, Pharmacy Insurance Administrators, LLC, Legends Pharmacy, TriadRx, and the former owners of Lake Side Pharmacy and related entities have agreed to pay $6,876,564 to resolve allegations that they violated the False Claims Act by waiving copays, charging the government higher prices than permitted, and trading federal healthcare business with other pharmacies.
The alleged scheme involved DermaTran, a pharmacy that opened in Rome, Georgia, in 2012 to make and sell custom "compound" pain creams. The owners of DermaTran during the relevant time include DIII Consulting, LLC; SRM Holdings, LLC; Gussenhoven Holdings, LLC; Sam Moss; and Robert Gussenhoven. Pharmacy Insurance Administrators, LLC, was created to handle the billing for DermaTran.
The government alleged that the pharmacies engaged in a corporate-wide scheme to illegally line their pockets by waiving copays and charging the government higher prices than permitted. This led to overutilization and costs federal programs millions of dollars in unnecessary spending, according to U.S. Attorney Ryan Buchanan.
"Waiving copays and charging the government higher prices leads to overutilization and costs federal programs millions of dollars in unnecessary spending," said U.S. Attorney Ryan Buchanan. "Our office will continue to enforce the False Claims Act to recover government payments that result from such misconduct."
The investigation involved law enforcement agencies including the FBI, the Department of Defense, Office of Inspector General, and the U.S. Postal Service, Office of Inspector General.
"Health care fraud abuse like this case erodes the trust patients have in the health care system," said Keri Farley, Special Agent in Charge of FBI Atlanta. "The FBI will not stand by when there are allegations of companies operating corporate-wide schemes to illegally line their pockets."
The settlement is a result of a partnership among law enforcement agencies and the U.S. Attorney’s Office to bring the matter to justice.
"The OPM OIG has no tolerance for businesses that knowingly take advantage of FEHBP, violating the rules to make a profit," said Amy K. Parker, Special Agent in Charge, OPM OIG. "I am extremely proud of the hard work of our investigators, analysts, and other law enforcement partners because overcharging the government is not a victimless crime – it contributes to higher premium prices and harms the financial integrity of the FEHBP."
DermaTran Health Solutions, LLC; Pharmacy Insurance Administrators, LLC; Legends Pharmacy; TriadRx; and the former owners of Lake Side Pharmacy and related entities have agreed to pay $6,876,564 to resolve the allegations.
Mandatory facts:
- Defendant/respondent: DermaTran Health Solutions, LLC; Pharmacy Insurance Administrators, LLC; Legends Pharmacy; TriadRx; and the former owners of Lake Side Pharmacy and related entities.
- Criminal charges: Violating the False Claims Act by waiving copays, charging the government higher prices than permitted, and trading federal healthcare business with other pharmacies.
- City and state: Rome, Georgia.
- Exact date: Not specified, but the alleged scheme began in 2012.
- Sentence or outcome: Settlement of $6,876,564.
- Dollar amounts: $6,876,564.
Key Facts
- State: Georgia
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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