The Department of Justice indicted four individuals in Tennessee in an alleged scheme involving telemedicine. The Indictment charges conspiracy to commit healthcare fraud, mail fraud, and introducing misbranded drugs into interstate commerce. According to prosecutors, the scheme involved at least $931 million of allegedly false claims.

Telemedicine involves connecting physicians and patients through electronic media. Physicians are contracted by the telemedicine companies and are paid a contracted fee. Patients pay a fee for the service. Typically, telemedicine companies do not submit claims to insurance companies.

The Indictment alleges that HealthRight LLC, a telemedicine company, fraudulently solicited insurance information from patients using its service. Any patients without insurance coverage were screened out. HealthRight LLC further procured prescriptions for pain creams and similar products preselected by defendants’ companies from unknowing doctors. Once the prescriptions were procured, defendants would massively mark up the price of the products, sometimes over 1000%, and bill to insurance companies. The Indictment further alleges that in most instances, the physician did not speak to the patient directly. Instead, physicians received electronic information claiming that the patient had specifically requested the preselected pain creams and other products.

While the Indictment alleges $931 million of allegedly false claims, the forfeiture prayer only seeks $154 million.

The Telemedicine company HealthRight LLC and its CEO pled guilty in September to an unrelated scheme involving fraudulent telemarketing of dietary supplements, skin creams, and testosterone.