Hayley Taff, 37, of Hammond, Louisiana, the chief executive officer of Central Rexall Drugs Inc., has pleaded guilty to orchestrating a massive health care fraud scheme that ripped off New Jersey state and local government health plans for over $50 million. Through a web of false claims, manipulated prescriptions, and medically unnecessary compounded drugs, Taff turned a Louisiana pharmacy into a profit machine — with zero regard for patient safety.
Taff entered her guilty plea by videoconference before U.S. District Judge Robert B. Kugler, admitting to one count of conspiracy to commit health care fraud. Federal prosecutors in Camden, N.J., revealed that Central Rexall, once a retail pharmacy, became a vehicle for financial exploitation after Taff struck a deal in 2013 with two co-conspirators — referred to only as Individual 1 and Individual 2 — to funnel 90 percent of the profits from the compounding operation to their company.
The scam hinged on exploiting loopholes in insurance reimbursements. Taff and her partners discovered that certain compounded medications — including pain creams, scar treatments, antifungal formulas, and libido boosters — could trigger thousands of dollars in payouts from the Pharmacy Benefits Administrator overseeing coverage for New Jersey teachers, firefighters, police officers, and state troopers. They didn’t care if the drugs worked. They cared how much they got paid.
Using trial-and-error with fake claims, Taff’s network tested ingredient combinations to maximize reimbursements, regardless of medical need. When insurers blocked one high-paying formula, Central Rexall simply rebranded with a new mix of ingredients — still not medically necessary, still not disclosed to patients or doctors. At Taff’s direction, the pharmacy shipped these concoctions across state lines, all while falsely claiming copayments were collected — even as unpaid bills piled up.
Taff admitted in court that Central Rexall abandoned any pretense of patient care. The operation became purely transactional: ship drugs, collect checks, repeat. The Pharmacy Benefits Administrator paid out more than $50 million for medications that served no legitimate medical purpose for New Jersey beneficiaries. Patients were left in the dark, their prescriptions manipulated for profit.
U.S. Attorney Craig Carpenito called the fraud ‘a betrayal of public trust,’ noting that the victims included hardworking public servants whose health plans were drained by greed. Taff now faces significant prison time as part of a federal crackdown on compounding pharmacy scams that have plagued states nationwide. The case underscores how easily health care systems can be exploited when profit trumps ethics.
Related Federal Cases
- NJ Doctor Vincent J. Gamuzza Indicted in $250K Health Care Fraud · Pennsylvania
- Eduardo Arango Chong Charged in $6M Health Care Fraud Scheme · New Jersey
- Sergio Acosta, Lawrence Ackerman Indicted in $6.6M Health Care Fraud · New Jersey
- NJ Doc & Sales Rep Hit with $2.5M Fraud Indictment · Louisiana
- Live Nation Faces Trial Over Monopoly Practices · Washington
Key Facts
- State: New Jersey
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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