The fraud scheme began to unravel last fall, with the discovery of a misdirected stack of bogus prescriptions — and a suspicious spike in Medicare drug spending tied to a doctor in Key Biscayne.
Now it's led to two guilty pleas, as well as an ongoing criminal case against a pharmacy owner.
Last year, ProPublica chronicled how lax oversight had led to rampant waste and fraud in Medicare's prescription drug program, known as Part D. That series included the case of Dr. Carmen Ortiz-Butcher, a kidney specialist whose Part D prescriptions soared from $282,000 in 2010 to $4 million in 2011 and nearly $5 million in 2012, the most recent year available.
But no one in Medicare asked her about the huge change in her practice, Ortiz-Butcher's attorney said.
Last September, the doctor asked a staffer to mail a fanny pack to her brother. But he received a package of prescriptions purportedly signed by the doctor, lawyer Robert Mayer said last year. Ortiz-Butcher alerted authorities.
Since then, investigators have uncovered a web of interrelated scams that, together, cost the federal government up to $7 million, documents show.
In February, the U.S. Attorney's office for the Southern District of Florida charged Maria De Armas Suero, a secretary at Ortiz-Butcher's Island Clinic from March 2011 to September 2013, with 11 counts of conspiracy, fraud and aggravated identity theft.
Suero agreed to plead guilty to two counts of conspiracy and identity theft. She acknowledged using Ortiz-Butcher's paper prescriptions to create fake scripts and was paid $100 for one. Local pharmacies then billed Medicare for filling the prescriptions, which were sometimes never dispensed. The false claims resulted in losses to Medicare of at least $2.5 million, court documents said.
In March, the U.S. Attorney brought similar charges against another secretary at the clinic, Milagros Matias Ortiz, who also pleaded guilty. Both women are set to be sentenced this month.
Suero's lawyer, Rene Palomino Jr., said the doctor had no knowledge of what was going on.
In May, prosecutors charged a pharmacy owner, Luisa Isabel Vega, with conspiracy and fraud relating to Medicare claims linked to Ortiz-Butcher. Vega's AB Pharmacy in Miami was overpaid $4.2 million by Medicare from April 2011 to November 2013, according to the indictment.
Vega has pleaded not guilty. Her lawyer declined to comment.
In an affidavit, Daniel Crespi, a special agent with the Health and Human Services Inspector General's office, said several Medicare beneficiaries whose prescriptions were supposedly filled by AB Pharmacy denied receiving most or all of the medications. "The beneficiaries further admitted that they had been paid kickbacks by patient recruiters for allowing AB Pharmacy to submit fraudulent claims to Medicare utilizing their personal information," Crespi wrote.
Crespi's affidavit says he interviewed a physician (ProPublica data shows it was Ortiz-Butcher) who purportedly sent prescriptions for 181 Medicare patients to AB Pharmacy, but it turned out that only 17 of them were actually patients of hers. "The physician concluded that his/her signature on the prescriptions were being forged and fraudulently utilized at AB Pharmacy."
Asked why Medicare didn't spot the spike in Ortiz-Butcher's supposed prescribing and inquire about it, Aaron Albright, a spokesman for the Centers for Medicare and Medicaid Services, said he can't discuss individual cases. He did say the agency has beefed up its oversight of the prescription drug program, including its use of proactive data analysis. The agency recently issued a new regulation giving itself the authority for the first time to kick abusive prescribers out of Medicare.
In a brief interview, Ortiz-Butcher said she was happy the case was being investigated and acted upon, but the effect on her has been profound.
"When you trust people in your life to work with you, and that trust is violated, it leaves a sense of emptiness that's insurmountable and also makes it very difficult to trust again," she said. "That's pretty much where I'm at right now."