Feds indict Wayne Co. pharmacist in insurance fraud scheme

Charles E. Ramirez
The Detroit News

Detroit — A federal grand jury has indicted a Wayne County man who was once a member of the state board that regulates pharmacies and drugs for allegedly bilking health insurance plans out of millions, officials said.

Nabil Fakih, owner of Dearborn Heights Pharmacy, co-owner of Dial Drugs in Westland and a licensed pharmacist, is accused of defrauding Medicare, Medicaid and Blue Cross Blue Shield health plans since January 2011, according to an indictment filed Tuesday in theU.S. District Court by the U.S. Attorney's Office.

In 2014, then-Gov. Rick Snyder appointed Fakih to serve a four-year term on the Michigan Board of Pharmacy.

On Wednesday, federal agents conducted a raid at Fakih's Dearborn Heights Pharmacy, located on Ford Road near North Gulley.

An FBI official Thursday confirmed the raid but said the agency cannot comment on the matter because the investigation and criminal proceedings are ongoing. 

According to the indictment, Fakih and his cohorts submitted fraudulent claims to Medicare, Medicaid and Blue Cross through Dial Drugs. The claims were for prescriptions for drugs such as the anti-psychotic Clozapine and sedative Alprazolam, written for people who were dead, it said.

He and the others involved in the scheme were able to overcharge Medicare and Medicaid about $569,670, the indictment said. They also overcharged Blue Cross about $558,079. 

The government also accuses Fakih of scheming to defraud Medicare and Medicaid out of $3.6 million and Blue Cross out of $1.4 million at his Dearborn Heights drug store.

In an email, Fakih's attorney, James Burdick told The Detroit News: "I’m quite confident that this prosecution is an outgrowth of a state Medicaid audit, which exploited a newly approved process of 'invoice-only' auditing. The problem with that is that small pharmacies are unable to maintain digitized records of purchases like the big chains can do... .  Small (“Mom and Pop”) pharmacies engage in far more informal record-keeping (records kept here and there) all subject to the vicissitudes of life, such as basement floods, fires, etc.  As a result, personal and business records are so often lost or destroyed."

Burdick said several wholesalers kept invoice records for three years, shorter than the audit period; the state only recently prohibited “informal” purchases of medication stock from pharmacies about to close that rarely included paperwork; and signature logs "proved that every patient received every prescription that had been billed to Medicaid (as well as Medicare and private insurance providers)." 

Twitter: @CharlesERamirez

Detroit News Staff Writer Mark Hicks contributed to this report.