A veteran physician from Fairfax County admitted Friday that he took kickbacks in exchange for prescribing unnecessary scar cream to his patients.
Leonard Rosen of Fairfax Station, who has practiced as an obstetrician-gynecologist in Northern Virginia since 1980, was enmeshed in a web of schemes involving doctors and pharmacists across the region, prosecutors say. He made $100,000 on phony prescriptions that defrauded health insurers out of $1.8 million.
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From 2014 to 2018, according to his plea, Rosen got a $100 kickback for every prescription he sent to pharmacies owned by Mohamed Abdalla of Allendale, N.J. Prosecutors said Abdalla owned multiple pharmacies in Northern Virginia, including -Medex Health Pharmacy in Falls Church and Royal Care Pharmacy in Fairfax.
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Abdalla’s company sent over a prescription pad with drugs already listed, and a nurse practitioner at Rosen’s office would sign the pages in advance of treatment.
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Every patient who had surgery at Rosen’s practice, Fairfax OB-GYN Associates, started getting a prescription for a custom scar cream, although he admits they did not all need the cream and could have used over-the-counter steroids to prevent scars. He admitted that only 15 percent of those prescriptions were medically necessary. Rosen also admitted to getting kickbacks from Abdalla for anti-inflammatory drugs, and signing off on prescriptions for an expensive red algae powder without knowing why it was being used.
Abdalla pleaded guilty to two related charges last year and was sentenced to four years in prison. Two other pharmacists, a pharmacy technician, a pharmaceutical sales representative and an attorney for a medical practice have also pleaded guilty.
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Rosen is the first doctor to admit participation in the various frauds. Three more doctors are alleged to be involved, according to court documents, but have not been publicly charged or named.
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According to the court records, one doctor approached Abdalla in 2013 about taking kickbacks for expensive custom-blended prescriptions. That scheme targeted TRICARE, a military health-care program, because of its high reimbursements and low patient costs. That doctor made millions of dollars from the scheme, according to prosecutors.
Another doctor in Rosen’s practice subsequently originated his own kickback scheme with Abdalla, roping in colleagues, prosecutors allege.
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Prosecutors claim those frauds cost insurers $8 million.
At first, Rosen said in court filings, he was told he was being paid to participate in a “speaker bureau” for Abdalla, but he quickly came to understand the true nature of the relationship.
Along with paying kickbacks to other physicians, including for an expensive Naloxone auto-injector, Abdalla and the other pharmacists took out fake prescriptions in various names to bilk insurance companies, according to court documents.
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“I succumbed to the tremendous pressure and huge expenses of owning and managing a small business,” Abdalla said at his sentencing in March. “It was my greed, one of the deadliest sins, that took me down this terrible path.”
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Rosen also admitted setting up a separate company that for seven years improperly billed patients as outside his insurance network, to get higher rates. Insurance companies paid $205,095 inappropriately, the government said.
He “sold out his medical license and training, and will now become a convicted felon,” acting U.S. attorney Raj Parekh said in a statement.
Rosen’s defense attorney Stuart Sears declined to comment on the plea.
The doctor pleaded guilty to one count of health-care fraud and is set to be sentenced in December.
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