Doctor accused in drug scam
Agents detail scheme to net millions from pain medication
A doctor who practiced medicine in Houston pleaded not guilty to federal charges Tuesday that he aided in a wide-ranging fraud scheme that allegedly netted millions of dollars for pharmacies and allowed injured federal workers and members of the U.S. military to obtain pain medication that was not medically necessary.
Dr. James Don Jackson, a general surgeon, is one of three doctors and 13 defendants under federal indictment for the alleged scam, which stretched from Houston to Atlanta and Columbus. In all, prosecutors say government insurance agencies that cover federal workers compensation and medical costs for members of the U.S. armed services paid out $39.7 million for false and fraudulent prescription claims for compounded drugs that patients didn’t need.
The indictment sheds light on the greatly expanding business done by compounding pharmacies amid a nationwide opioid crisis, in which patients have resorted to new means for getting a prescriptionstrength high.
Compounded medicines, which pharmacists make by combining or altering commercial drugs to meet individual patients’ needs, don’t face the same FDA scrutiny, nor are they
subject to fixed prices or guidelines as are other prescription medicines. These businesses are particularly susceptible to fraud, waste and abuse, according to Labor Department officials. A single 15 ounce pain-relief cream can go for as much as $15,000, according to testimony in Washington, D.C., by a Labor Department official before a congressional subcommittee on workforce protections.
Pleads not guilty
Scott S. Dahl, inspector general for the Labor Department, told the subcommittee that Federal Employees’ Compensation Act had spent $2 million for compounded drugs in 2011. By 2016, spending on compound medicines had skyrocketed to $263 million.
In the Houston federal case, Jackson, who is from Palestine, pleaded not guilty Tuesday before U.S. Magistrate Dena Hanovice Palermo to taking monthly kickbacks to prescribe the drugs to federal workers referred by an agency to the Top Doctor Therapy Center. Jackson, a general surgeon in his late 50s whose listed primary practice is in Gulfton, is charged with three counts of health care fraud as well as conspiracy to defraud the government and conspiracy to commit health care and wire fraud. He is free on bond.
Jackson’s attorney John L. Green said he has handled many cases of health care fraud, but in this instance he feels the charges are completely unfounded.
“He didn’t do anything wrong whatsoever,” Green said of the doctor. “He has had an impeccable career. He’s a good, hardworking man.”
Prosecutors say that between 2014 and 2018 pharmacies submitted compounded medicine and other allegedly fraudulent claims for more than $125 million under the Federal Employees Compensation Act and TRICARE, a health program for members of the U.S. Department of Defense.
Investigators say in court documents that the fraud was orchestrated by a Houston couple: John Cruise, CEO of the Injured Federal Workers Advocate Association, and his wife, Lashonia Johnson, the director of IFWAA, a group with offices in Houston, Atlanta and Columbus, that purportedly helps federal workers injured on the job.
Kickbacks alleged
Cruise and Johnson also ran a pharmacy in Spring that dispensed the compounded medicine. The president of another pharmacy in Houston also participated in the fraud, according to court documents.
The agency leaders in Houston are accused of signing up injured federal by promising them free help to process their workers’ compensation claims, according to court documents. Pharmacy owners in Spring, Houston and Atlanta then paid rent or kickbacks to the doctors for writing the unnecessary prescriptions.
Jackson faced a reprimand in Aug. 29, 2014, for writing problematic prescriptions, according to his online record at the Texas Medical Board website.
Jackson paid a fine and entered into a mediated agreement to be monitored by another doctor for a year and complete courses in medical record keeping, prescribing and ethics, according to the board’s website. The board found his records were inadequate to substantiate the medicine he was prescribing. He also failed to properly supervise a nurse under his direction and appear at board hearings.
The federal indictment also charges Dr. Deepak Chavda, of Dallas, who prescribed pain medication that wasn’t necessary through a bone clinic he worked for in the Fort Worth suburb of North Richland Hills. The third physician charged in the case is Dr. Jay Bender, who worked at an orthopedic and spine clinic in Atlanta.