For more than two years, Bonnie Jean Lawless Diaz took part in a scheme to defraud Tricare of nearly $15 million by convincing patients to take unnecessary drugs, prosecutors say.
Diaz was sentenced on Jan. 18 to 36 months of probation and ordered to pay $180,000 in restitution after pleading guilty for her role in what prosecutors say was a conspiracy to defraud Tricare.
Diaz, 46, of Slidell, Louisiana, pled guilty on Sept. 23 to one count of misprision of the commission of a felony, according to a release from the Justice Department. “Misprision” is the legal term for knowingly concealing the commission of a felony. Diaz received her sentence from a federal judge before the Eastern District of Louisiana federal court on Jan. 18, 2021.
“Those entrusted with providing health care services to veterans and their family members will be held accountable should they violate that trust,” Special Agent in Charge Jeffrey Breen of the Department of Veterans Affairs Office of Inspector General’s South Central Field Office said in a press release.
Health care fraud is not a unique crime. According to the National Health Care Anti-Fraud Association as much as 10% of total health care expenditures, some $300 billion annually, are due to fraud.
Diaz participated in a Tricare health care fraud conspiracy which ran from March, 2014 through October, 2016, according to a press release. During this time, Diaz knowingly submitted or caused to be submitted prescriptions for compounded medications without medical necessity. Further, she concealed that she knew these medications were unnecessary until discovered by investigators.
According to the Food and Drug Administration, a compounded medication is two or more drugs that are combined and tailored to meet specific needs. Examples of compounding medications include eliminating certain dyes that a patient might be allergic to or changing a prescription from a solid to a liquid form. Due to their customization, once drugs are compounded, they lose FDA approval.
The DOJ states that through the course of the conspiracy, the owner of a pharmacy contracted through various entities to collect copayments from Tricare beneficiaries to be reimbursed for the unnecessary medications, which were subsequently never doled out.
At that point, the pharmacy worked through co-defendant Donald Auzine to market the drugs to individuals who did not need them, along with doctors who were willing to prescribe them even without a medical necessity to do so, according to prosecutors.
The pharmacy then dispensed the unnecessary prescriptions to Tricare beneficiaries and other health care benefit programs and defrauded Tricare through kickback payments waived and credited copayments while submitting false and fraudulent claims for reimbursement.
Auzine, who has yet to be sentenced, pled guilty to one count of conspiracy to commit health care fraud in September. He faces up to 10 years in prison, a $250,000 fine, three years supervised release, a $100 special assessment fee, and restitution in the amount of $1.2 million.
“Individuals involved in this scheme illegally billed TRICARE out of close to $15 million, and I am pleased that the U.S. Attorney’s Office is requiring justice,” Special Agent in Charge Cynthia Bruce, Office of Inspector General, Defense Criminal Investigative Service, Southeast Field Office said in a press release. “There are no victimless crimes, and DCIS agents will continue to pursue unscrupulous greedy individuals who steal from our military health care system and all taxpayers.”
James R. Webb is a rapid response reporter for Military Times. He served as a US Marine infantryman in Iraq. Additionally, he has worked as a Legislative Assistant in the US Senate and as an embedded photographer in Afghanistan.