48 charged in massive Medicaid fraud case - 13 WTHR Indianapolis

Authorities say a nationwide prescription drug ring bought mountains of HIV medications and other drugs from down-and-out Medicaid recipients in New York City, then marketed the pills to pharmacies that dispensed them to unsuspecting consumers.

Federal prosecutors in Manhattan announced charges against 48 defendants.

Arrests were made in New York, Pennsylvania, Massachusetts, Florida and Texas. The FBI also seized more than 250,000 pills worth $16 million.

Unlike cases involving prescription painkillers and other addictive narcotics, the ring specialized in expensive medications - some worth more than $1,000 a bottle - for serious illnesses like HIV, schizophrenia and asthma. Authorities estimated that Medicaid lost at least $500 million in reimbursements over at least five years on pills diverted into the secondhand market.

And although the fraud created a risk that patients could end up using secondhand drugs that were outdated or degraded from storage in car trunks or storage lockers, authorities said there were no reports that anyone was harmed.

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