Pharmacy Owner Pleads Guilty to Obstructing Audit

The owner of 2 pharmacies in Alabama has agreed to plead guilty to obstructing a Medicare audit.

The owner of 2 pharmacies in Alabama has agreed to plead guilty to obstructing a Medicare audit.

The US Attorney’s Office for the Northern District of Alabama stated that Rodney Dalton Logan, 63, of Muscle Shoals, will be charged with one count of obstructing a 2012 federal audit of Medicare claims submitted by a pharmacy he owned. He’s set to pay a $2.5 million penalty to the government.

A registered pharmacist, Logan owned multiple businesses throughout northwest Alabama, including Leighton Pharmacy Inc, which did business as Sheffield Pharmacy and Homecare in Sheffield, and Russellville Pharmacy in Russellville. The Sheffield and Russellville pharmacies both operated as compounding and retail pharmacies.

Logan has since sold the 2 businesses, according to his attorney.

The audit began when CVS Caremark administered prescription drug claims for Medicare Part D, which prohibits reimbursement to pharmacies for compounded medications made using bulk pharmaceutical powders. Nevertheless, Logan’s pharmacies continued to compound prescriptions using bulk powders for patients with Medicare Part D coverage.

The pharmacies used the billing code for the tablet or capsule form of the ingredient. Logan then submitted falsified and misleading documents stating that medications in tablet or capsule form were used as ingredients for the compounded prescriptions.

“This case revolves around the falsification of documents in an effort to defraud Medicare, which exists to provide health care services for the elderly,” said US Attorney Joyce White Vance in a press release. “My office and our law enforcement partners are committed to ensuring the integrity of government programs and to prosecuting those who would provide false information to criminally profit from those programs.”

The maximum penalty for obstructing a federal audit is 5 years of imprisonment and a fine of $250,000, or twice the amount improperly gained through the defendant’s conduct.

US Judge Virginia Hopkins will sentence Logan in Birmingham. A date has not yet been set.