Pharmacy must pay $9.5 million for prescription fraud
A Kansas City pharmacist pleaded guilty Friday to bilking Medicaid out of tens of thousands of dollars, federal prosecutors say.
Steven Baraban, the former director and managing partner of Stark Pharmacy, was charged with one count of health care fraud, a felony that could mean up to 10 years in prison and a $250,000 fine.
Baraban supervised operations at the pharmacy location inside Research Medical Center on Holmes Road.
According to court documents, Medicaid paid him for pain creams as wells as an antibiotic used to treat bacterial infections, though patients never received those products.
“Baraban knew, or should have known, that Medicaid was being billed by Stark Pharmacy for medications that it did not take appropriate steps to deliver,” read the charge filed in U.S. District Court. “Baraban and Stark Pharmacy financially benefited by billing, and being paid by, Medicaid for medications for which there was no attempt to deliver them to Medicaid beneficiaries.”
The charges against Baraban come after the pharmacy settled a federal health care fraud lawsuit for $9.5 million in December. A portion of that money — $1.5 million — went to a former employee who blew the whistle on the pharmacy.
Emily Barnes, a Lenexa pharmacist, worked at Stark in 2015 and quit after just five months. She reported that she witnessed numerous incidents of health care fraud, including auto-filling prescriptions for a certain pain cream without patients’ consent and charging full price for prescriptions that were only partially filled.
The pharmacy’s namesake, Howard Stark, is not affiliated with the business, having sold it in 2000. He said that as a past president of the American College of Apothecaries, he was disappointed to see his name involved.
In addition, the pharmacy is not affiliated with the hospitals where it operates — Research’s Brookside campus and Menorah Medical Center in Overland Park.
In the latest case, according to court records, Stark Pharmacy billed Medicaid for nearly $120,000 for compound pain creams that were intended for Medicaid patients.
“Medicaid would not have paid those claims if it had known that Stark Pharmacy did not take appropriate steps to deliver those medications and maintain appropriate proof of its efforts of delivery,” court records said.
In June 2016, the Stark location at Research filled a prescription for Zyvox for someone on Medicaid. Medicaid reimbursed the pharmacy $5,162, but then Stark sent the medication back to the wholesaler and kept the refund, records show.
Baraban will have to forfeit any property and funds “derived, directly or indirectly, from gross proceeds traceable” to the fraud. That also includes $125,000 in cash.