Attorney General James Announces Conviction Of Owner Of Three Manhattan Pharmacies For Defrauding Medicaid

Pharmacist Faces Up to Six Years in Prison and will Repay over $3 Million for Role in HIV Drug Fraud Scheme 

  Attorney General Letitia James announced the guilty pleas of licensed pharmacist Hin T. Wong (“Wong”), 50, of Manhattan, and her companies New York Pharmacy Inc. (“NY Pharmacy”), NYC Pharmacy Inc. (“NYC Pharmacy”), and NY Healthfirst Pharmacy Inc. (“NY Healthfirst”) in connection with a multi-million dollar Medicaid fraud scheme involving HIV drugs.   

“This Defendant, a licensed pharmacist, exploited some of our state’s most vulnerable patients to steal millions of dollars reserved to provide New Yorkers with essential healthcare,” said Attorney General Letitia James.  “My office will continue to hold accountable health care professionals who forsake their professional responsibility to their patients and instead choose to use their professional status to line their pockets.” 

Wong pled guilty in Manhattan Supreme Court before Justice Mark Dwyer to Grand Larceny in the First Degree, a class “B” felony.  Wong will be sentenced to two to six years in state prison and will forfeit over $3,600,000. All of her pharmacies, which are now closed, were also convicted: 

•  NY Pharmacy, formerly at 131 Walker St. in Manhattan, pleaded guilty to Grand Larceny in the First Degree, a class “B” felony; 
• NYC Pharmacy, formerly at 203 East 121st St. in Manhattan,  pleaded guilty to Grand Larceny in the First Degree; and  
• NY Healthfirst Pharmacy, formerly at 2021 First Ave. in Manhattan, pleaded guilty to Grand Larceny in the Second Degree, a class “C” felony. 

In court papers, Wong admitted to paying or directing her employees to pay kickbacks to several undercover agents from the Attorney General’s Medicaid Fraud Control Unit (“MFCU’) in return for their agreement to fill their HIV prescriptions at her pharmacies. Wong’s pharmacies then billed and were eventually paid over $60,000 by Medicaid for refills on prescriptions that Wong’s pharmacies either did not dispense to the MFCU undercover agents, a scheme known as “auto-refilling,” or that were predicated on the payment of an unlawful kickback. 

State law strictly prohibits all medical providers, including pharmacies, from paying or offering to pay kickbacks to another person in return for the referral of medical services ultimately paid for by Medicaid.     

The investigation showed that from January 2014 to August 2017, Wong’s pharmacies did not purchase a sufficient inventory of medication from licensed drug wholesalers to account for the quantity of medication -- much of which was for HIV drugs -- for which Wong’s pharmacies billed Medicaid and Medicaid Managed Care Organizations (“MCOs”). Relying on thousands of false claims for payment filed by Wong’s pharmacies, Medicaid and Medicaid MCOs paid Wong’s pharmacies over $3.5 million. 

In conjunction with the criminal case, the Attorney General also filed a civil asset forfeiture and New York False Claims Act action against Wong, her pharmacies and another entity owned by Wong, KT Studio Inc. a/k/a/ Dove Cat Studio a/k/a C’est La Vie Studio.  As part of this action, the court approved the Attorney General’s application to freeze Wong’s assets, including several bank accounts, to preserve stolen money.   Under the civil settlement, Wong will surrender over $3,600,000 – including over $700,000 in seized cash -- all of which will be returned to the New York Medicaid program. 

The Attorney General thanks the New York State Office of the Medicaid Inspector General and the United States Department of Health and Human Services, Office of the Inspector General (HHS-OIG) for their assistance in this investigation. The Attorney General also thanks Medicaid MCOs Amida Care and Wellcare; pharmacy benefit managers CVS Caremark and Optum RX; and pharmaceutical wholesalers HD Smith and McKesson for their cooperation with the investigation. 

Attorney General James reminds New Yorkers that fraud also causes bad healthcare. Here are some things to look out for when you receive Medicaid benefits and have a prescription: 

• Did someone offer you money to send your prescription to a particular pharmacy? 

• Did someone offer you money to not pick up a medications for which you had a prescription?   
• Did someone offer to “buy” your medications from you? 
• Have you ever been told by a pharmacy you chose that it couldn’t fill your prescription because another pharmacy was billing your prescriptions? 
• Did you receive medication after the expiration date on the label? 
• Did your medication appear to be dirty or improperly stored?  

New Yorkers can report suspected fraud to the Attorney General’s toll-free Medicaid Fraud Hotline, at (800) 771-7755 or online at ag.ny.gov/medicaid-fraud/contact. 

MFCU’s investigation was conducted by Investigator Nefertiti Clarke with the assistance of Supervising Investigator Dominick DiGennaro and Deputy Chief Investigator Kenneth Morgan. The financial analysis for the investigation was conducted by Principal Auditor-Investigator Cristina Marin and Auditor-Investigator Megan Scott with the assistance of New York City Regional Deputy Chief Auditor Jonathan Romano and New York City Regional Chief Auditor Thomasina Smith.