Two Mississippi-licensed physicians and two Mississippi-licensed registered nurses were charged in an indictment unsealed today for their roles in a multi-million dollar scheme to defraud TRICARE, the health care benefit program serving U.S. military, veterans and their respective family members, as well as private health care benefit programs Blue Cross & Blue Shield of Mississippi and United Healthcare of Mississippi.
Shahjahan Sultan, M.D., 37, of Madison, Mississippi, Thomas Edward Sturdavant, M.D., 56, of Kingsport, Tennessee, Freda Cal Covington, R.N., 54, of Hattiesburg, Mississippi, and Fallon Deneem Page, R.N., 36, of Soso, Mississippi, were each charged in various counts of a 15-count indictment returned on June 11, 2019 in the Southern District of Mississippi. The indictment was unsealed upon the defendants’ arrests today. The defendants will make their initial appearances this week before U.S. Magistrate Judge Michael T. Parker of the Southern District of Mississippi.
Sultan, Sturdavant, Covington and Page were each charged with one count of conspiracy to commit health care fraud and mail fraud. In addition, Sultan was charged with two counts of mail fraud, one count of conspiracy to distribute and dispense a controlled substance, two counts of distributing and dispensing a controlled substance, one count of conspiracy to pay and receive health care kickbacks and four counts of paying health care kickbacks. Sturdavant was also charged with two counts of mail fraud, one count of conspiracy to distribute and dispense a controlled substance and two counts of distributing and dispensing a controlled substance. Page was also charged with two counts of mail fraud.
The indictment alleges that Sultan, Sturdavant, Covington and Page participated in a scheme to defraud TRICARE and private health care benefit programs by prescribing and dispensing medically unnecessary compounded medications, some of which included ketamine, a controlled substance, to individuals, at times without first examining them, for the purpose of having an Ocean Springs, Mississippi-based compounding pharmacy dispense these medically unnecessary compounded medications. In addition, the indictment alleges that, between March 2014 and February 2015, the defendants’ scheme caused TRICARE and private health care benefit programs to reimburse the compounding pharmacy more than $7 million for dispensing the compounded medications prescribed by Sultan and Sturdavant. The indictment further alleges that Sultan was paid at least 25 percent of the reimbursements received from health care benefit programs, including TRICARE, for compounded medications prescribed by Sultan and Sturdavant. Sultan is alleged to have then paid Sturdavant for prescribing compounded medications to TRICARE beneficiaries and to have paid other co-conspirators for identifying and recruiting TRICARE beneficiaries to receive compounded medications.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the FBI and DCIS. Assistant Chief Dustin M. Davis and Trial Attorney Sara E. Porter of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Mary Helen Wall and Kathlyn R. Van Buskirk of the Southern District of Mississippi are prosecuting the case.