Wade Ashley Walters, Health Care Fraud, Mississippi 2023

Wade Ashley Walters Sentenced for Multimillion-Dollar Health Care Fraud Scheme

A Mississippi businessman was sentenced today for his role in a multimillion-dollar scheme to defraud TRICARE, the health care benefit program serving U.S. military, veterans, and their respective family members, as well as private health care benefit programs.

Wade Ashley Walters, 54, of Hattiesburg, a co-owner of numerous compounding pharmacies and pharmaceutical distributors, was sentenced today on his guilty plea to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.

U.S. District Judge Keith Starrett of the Southern District of Mississippi ordered Walters to serve a total of 18 years in prison and to pay $287,659,569 in restitution. Walters was remanded into custody following the sentencing hearing. Walters was further ordered to forfeit $56,565,963, representing the proceeds he personally derived from the fraud scheme.

“The fraud committed by Walters and others in this investigation wasted hundreds of millions of taxpayer dollars and deprived individuals of needed medical care,” said David P. Burns, Acting Assistant Attorney General of the Justice Department’s Criminal Division. “Today’s significant sentence signifies that we will continue to stand with our agency partners to root out health care fraud schemes and see their perpetrators brought to justice.”

The scheme, which occurred between 2012 and 2016, involved Walters distributing compounded medications that were not medically necessary. As part of the scheme, Walters and his co-conspirators adjusted prescription formulas to ensure the highest reimbursement without regard to efficacy; solicited recruiters to procure prescriptions for high-margin compounded medications and paid those recruiters commissions based on the percentage of the reimbursements paid by pharmacy benefit managers and health care benefit programs, including commissions on claims reimbursed by TRICARE; solicited (and at times paying kickbacks to) practitioners to authorize prescriptions for high-margin compounded medications; routinely and systematically waived and/or reduced copayments to be paid by beneficiaries and members, including utilizing a purported copayment assistance program to falsely make it appear as if the pharmacies were collecting copayments.

“Today’s sentencing is another mile marker on the long road to justice for victims, our veterans, our military, and all American taxpayers, as the mastermind of the largest health care fraud scheme in Mississippi history has been held to answer for his crimes,” said Mike Hurst, U.S. Attorney for the Southern District of Mississippi. “I want to commend our prosecutors, Justice Department trial attorneys, and every member of this incredible team of federal, state, and local law enforcement agencies for discovering this scheme and bringing all of these criminals to justice. While there is more work to do, the public can rest assured that we will continue to hold evildoers to account and that justice will always be done in the Southern District of Mississippi.”

The scheme to defraud TRICARE out of hundreds of millions of dollars not only diverted taxpayer money from essential services and medical care but victimized the brave men and women who selflessly serve or have served our country, said Michelle Sutphin, Special Agent in Charge of the FBI’s Jackson Field Office. “The investigation into this specific scheme, which now spans across multiple states and FBI field offices, began in the FBI’s Jackson Field Office. I am incredibly proud of the relentless efforts made by our Special Agents, Intelligence Analysts and professional support staff, but also the assistance from our partner agencies which make cases like this successful. The FBI and our law enforcement partners are committed to seeking those that intend to steal from others for their own financial gain

Wade Ashley Walters, a co-owner of numerous compounding pharmacies and pharmaceutical distributors, was sentenced to 18 years in prison and ordered to pay $287,659,569 in restitution. He was also ordered to forfeit $56,565,963. Walters was sentenced on [no exact date] in the Southern District of Mississippi. He was convicted of conspiracy to commit health care fraud and conspiracy to commit money laundering. This case is a reminder of the need for vigilance in the health care industry and the importance of rooting out corruption and fraud.

Source: https://www.justice.gov/usao-sdms/pr/compounding-pharmacy-mogul-sentenced-multimillion-dollar-health-care-fraud-scheme