State secures settlement of $1.2 million
Attorney General Eric T. Schneiderman on Tuesday announced that his office secured a settlement of more than $1.2 million to resolve claims that a Brooklyn pharmacist defrauded Medicaid by improperly billing for prescription medications that he purchased on the street.
In addition to repaying the New York State Medicaid Program, Rao Veeramachaneni agreed to surrender his pharmacist’s license and withdraw from the Medicaid program. In addition, he agreed to a ban from working in the pharmaceutical or health care industry in the future.
“Patients should be able to trust that the medications they buy at a pharmacy are obtained only through properly regulated channels – not out of suppliers’ cars. As a result of our office’s investigation, this settlement holds accountable a pharmacist who put the public at risk and ripped off New York taxpayers just to make a quick buck,” Schneiderman said.
From 2004 to 2009, Veeramachaneni owned two pharmacies, 1951 Pharmacy, located at 1951 Flatbush Ave., Brooklyn, and Positive Care Pharmacy, located at 502A East Tremont Ave. in the Bronx. Both locations predominantly served Medicaid recipients.
Veeramachaneni admitted that he bought medications, including diabetic and HIV/AIDS drugs, on the black market, including out of his suppliers’ vehicles. He then brought the drugs into his pharmacies and dispensed them to patients without disclosing their true nature.
Between Jan. 1, 2006 and Jan. 1, 2008, Veeramachaneni submitted claims to the Medicaid program and received more than $1.2 million dollars for black market medication that he dispensed to his patients.
New York State only permits pharmacies to purchase medication from authorized wholesalers. None of Veeramachaneni’s suppliers were registered wholesalers in New York State, and the source of the diverted medication is unknown.
Diverted pharmaceuticals typically consist of unused medications and drugs stolen from manufacturers.