NEW YORK (AP) -- A New York City pharmacy owner was indicted in an $800,000 Medicaid scheme after a sting operation where undercover officers posed as patients willing to take cash instead of HIV medication, prosecutors said Thursday.
Aleksandr Ilyayev billed Medicaid for the expensive drugs that were not dispensed, or were only partly dispensed, District Attorney Charles Hynes said. HIV-related medications are some of the most expensive drugs on the market, costing $1,500 or $1,700 per month per prescription, prosecutors said.
The investigation ran from January 2011 to November 2012. Based on the sting, Brooklyn prosecutors believe Ilyayev gave patients kickbacks in the form of cash or Metrocards for bringing him prescriptions. A videotaped conversation with an undercover shows Ilyayev offering the woman $25 per prescription and more if necessary, suggesting she sell the pills if she didn't need them.
"I will give you more and more," he says on the tape. "Every time you bring me some patient, I give him medication, I can take care of you. And I can take care of them. From each patient, I will give you your commission, OK?"
Ilyayev is not a licensed pharmacist and the pharmacist working at the shop is not suspected of any wrongdoing, prosecutors said.
Because the undercover officers were posing as patients willing to go without medicine, prosecutors believe real patients weren't getting drugs they needed.
"We would assume that it was probably happening with other patients as well, and it probably was people who really needed their medications and chose to take a couple of dollars from the defendant or a couple of Metrocards instead of taking the medicine they really needed," said Assistant District Attorney Debra Jaroslawicz.
Ilyayev denies any wrongdoing, pleaded not guilty and was released on $15,000 bail. Defense attorney John Kaley said his client should be presumed innocent.
"It wouldn't be the first case in which charges are proved unfounded," he said.
Medicaid is a federal and state partnership program that provides health care benefits to poor Americans. Authorities said the government would have rejected about $800,000 in payments if it had been aware of the circumstances. They say part of that money involved direct transactions the defendant had with undercover investigators that totaled $65,000 in fraudulent payments.
Prosecutors say paperwork has been filed with federal authorities who will likely revoke Ilyayev's partnership in Medicaid. The pharmacy in Williamsburg, Brooklyn, remains open because other patients needed medication, prosecutors said.