FILED

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF TENNESSEE
AT GREENEVILLE
UNITED STATES OF AMERICA,
Plaintiff,
v.

AMBER REILLY
Defendant.

)
)
)
)
)
)
)
)
)

ocr o4 zo1s
u

Clerk
s 0
Eastern' Di~tri~t ~s/~ct Court
ennesseF
At G
reenevifte

No.~,'

//o-Cr- /D]

Judge: ~

INFORMATION
Introductory Allegations

The United States Attorney charges that:

(1)

At all times relevant to the information, the defendant AMBER REILLY was

employed as a clinical pharmacy manager by Walgreens at the Walgreens Specialty Pharmacy

located at 130 W. Ravine Rd., #101, Kingsport, TN 37760.
(2)

In her role as the clinical pharmacy manager, the defendant AMBER REILLY

supervised several employees, including various pharmacy technicians.

(3)

Medicaid was a health insurance program for low income and disabled

individuals that was jointly funded by the federal and state governments. Since approximately
1994, the State of Tennessee's Medicaid program was called "TennCare."
(4)

TennCare is a "health care benefit program," as defined by 18 U.S.C. 24(b).

( 5)

Magellan Health Services ("Magellan") was the pharmacy benefits manager for

TennCare. As TennCare's pharmacy benefits manager, Magellan had numerous responsibilities,

one of which was to determine whether patients who sought payment coverage from TennCare
for expensive prescription drugs satisfied TennCare's coverage eligibility criteria.

Case 2:16-cr-00107-JRG Document 1 Filed 10/04/16 Page 1 of 8 PageID #: 1

(6)

Magellan utilized a form called a "prior authorization" to determine whether a

patient satisfied TennCare's coverage eligibility criteria. Magellan required pharmacies to

complete and submit a prior authorization to Magellan on behalf of an individual patient, prior to
Magellan determining whether TennCare would pay for the patient's prescribed pharmaceutical
drugs. The TennCare I Magellan prior authorizations that are relevant hereto required that the
pharmacy: (a) provide the patient's name, date of birth, and prescriber's identifying information;
(b) answer numerous and detailed questions about the patient's medical history; and (c) submit
medical lab reports and drug test results supporting the pharmacy's answers to questions about
the patient's medical history.
(7)

After receiving a prior authorization from a pharmacy, Magellan evaluated the

answers and supporting medical lab reports to determine if the referenced patient satisfied
TennCare's payment eligibility criteria. If so, Magellan notified the pharmacy that coverage
would be provided. If not, Magellan notified the pharmacy that coverage would not be provided,
and included a brief description of the basis for denying coverage.
(8)

TennCare I Magellan did not require that pharmacies complete and submit a prior

authorization for all prescriptions; but, TennCare I Magellan required pharmacies to complete
and submit a prior authorization for four prescription drugs called Sovaldi, Harvoni, Viekira
Pak, and Daklinza.
(9)

Sovaldi, Harvoni, Viekira Pak, and Daklinza were prescription drugs used

to treat Hepatitis C infections. These drugs were extremely expensive, and TennCare paid more
than $28,200, $30,200, $26,650, and $20,100 to purchase one prescription for Sovaldi,
Harvoni, Viekira Pak, and Daklinza, respectively.

Case 2:16-cr-00107-JRG Document 1 Filed 10/04/16 Page 2 of 8 PageID #: 2

(1 0)

For medical reasons, medical practitioners frequently prescribed Sovaldi and

Daklinza in conjunction, and frequently prescribed two or three courses of each prescription of
Sovaldi, Harvoni, Viekira Pak, or Daklinza.
(11)

TennCare specified that a TennCare patient with Hepatitis C would be eligible for

payment coverage for Sovaldi, Harvoni, Viekira Pak, and/or Daklinza only ifthe patient
satisfied certain medical eligibility criteria, including but not limited to the following: (a) the
patient's metavir score was F3 or F4; (b) the patient's fibrosis score was greater than 0.59; (c) the
patient had not used any illicit substance within the past six months; and (d) the patient had no
known allergies to the prescription drugs.
(12)

The metavir scoring system and the fibrosis scoring system are used to assess

fibrosis or scarring of the liver of patients with Hepatitis C and other ailments.
(13)

Between February 12,2014 and June 13,2016, the defendant AMBER REILLY

submitted to TennCare through Magellan (hereinafter "TennCare I Magellan"), or caused other

employees in the Walgreens pharmacy where she worked to submit to TennCare I Magellan,
prior authorizations, supporting medical lab reports, and drug test results for numerous patients
who had prescriptions for the above-described four Hepatitis C drugs.
(14)

On these prior authorizations, the defendant AMBER REILLY answered

questions about, or caused other employees in the Walgreens pharmacy where she worked to
answer questions about, each patient's metavir score, fibrosis score, and recent illicit substance
abuse history. The defendant AMBER REILLY also submitted, or caused others to submit,
supporting medical lab reports and drug test results that substantiated the answers to the
questions.

3
Case 2:16-cr-00107-JRG Document 1 Filed 10/04/16 Page 3 of 8 PageID #: 3

(15)

Based upon the answers contained in these prior authorizations and supporting

medical lab reports, Magellan approved payment coverage for Sovaldi, Harvoni, Viekira
Pak, and/or Daklinza for approximately 96 Hepatitis C patients whose prescriptions were
submitted to TennCare I Magellan by the defendant AMBER REILLY or at her direction.
(16)

Based upon Magellan's approval ofthese 96 patients' prescriptions, between

February 12, 2014 and June 13, 2016, TennCare paid a total of approximately $8,721,285.64 for
Sovaldi, Harvoni, Viekira Pak, or Daklinza prescriptions submitted by the defendant
AMBER REILLY or at her direction.

The Scheme and Artifice

(17)

From on or about October 6, 2014 through on or about April27, 2016, the

defendant AMBER REILLY, while employed as a Clinical Pharmacy Manager at the

Walgreen's Specialty Pharmacy in Kingsport, TN, submitted, or caused to be submitted, prior
authorizations, medical lab reports, and drug test results pertaining to at least 51 Hepatitis C
patients who did not satisfy TennCare's payment eligibility criteria and, thus, were ineligible to
have TennCare pay for their Sovaldi, Harvoni, Viekira Pak, or Daklinza prescriptions.

The Execution
(18)

As part of this scheme, the defendant AMBER REILLY altered and falsified these

prior authorizations, medical lab reports, and drug test results, so that these otherwise unqualified
51 Hepatitis C patients appeared to satisfy TennCare's payment eligibility criteria.
(19)

As part of this scheme, approximately 46 of these Hepatitis C patients had

medical lab reports depicting metavir scores ofFO, F1, or F2, which is below TennCare's
payment eligibility criterion of F3 or higher. The defendant AMBER REILLY did not submit
these authentic medical lab reports to TennCare I Magellan because she knew that, if she did so,

Case 2:16-cr-00107-JRG Document 1 Filed 10/04/16 Page 4 of 8 PageID #: 4

TennCare I Magellan would have denied coverage for these patients. Instead, the defendant
AMBER REILLY altered all or substantially all of these medical lab reports as follows: (a)
printed a piece of paper on which she had typed the characters "F3" or "F4", used scissors to cut
out the characters, and taped or otherwise adhered the falsified qualifying characters on top of
the authentic non-qualifying characters "FO", "F1 ",or "F2" on the original medical lab report; or
(b) obtained a medical lab report with a qualifying metavir score from another patient and, using
a technique similar to that described in the immediately-preceding clause (a), superimposed a
non-qualifying patient's name over the qualifying patient's name, and made other similar
conforming alterations. After having altered the non-qualifying metavir scores as described, the
defendant AMBER REILLY faxed the falsified medical lab reports to TennCare I Magellan.
(20)

As part of this scheme, approximately 43 ofthese Hepatitis C patients had

medical lab reports depicting fibrosis scores of 0.59 or less, which is below TennCare's payment
eligibility criterion of greater than 0.59. The defendant AMBER REILLY did not submit these
authentic medical lab reports to TennCare I Magellan because she knew that, if she did so,
TennCare I Magellan would have denied coverage for these patients. Instead, the defendant
AMBER REILLY, using a technique similar to that described in paragraph (19), superimposed a
qualifying fibrosis score over the unqualified fibrosis score or superimposed the non-qualifying
patient's name over the name of another patient whose medical lab reports contained a qualifying
fibrosis score. After having altered the fibrosis scores as described, the defendant AMBER
REILLY faxed the falsified medical lab reports to TennCare I Magellan.
(21)

As part of this scheme, at least nine of these Hepatitis C patients had drug test

results showing that they tested positive for illicit substances including cannabis, opiates, or
amphetamines, etc., which made them ineligible for payment coverage by TennCare. The

Case 2:16-cr-00107-JRG Document 1 Filed 10/04/16 Page 5 of 8 PageID #: 5

defendant AMBER REILLY did not submit these authentic drug test results to TennCare I
Magellan because she knew that, if she did so, TennCare I Magellan would have denied coverage
for these patients. Instead, the defendant AMBER REILLY, using a technique similar to that
described in paragraph (19), superimposed the word "NEGATIVE" over the word "POSITIVE"
on the drug test result adjacent to the type of illicit drug (e.g., cannabis, opiates, amphetamines,
etc.) for which these nine patients had tested positive. After having altered the drug test results
as described, the defendant AMBER REILLY faxed, or caused to be faxed, the falsified drug test
results to TennCare I Magellan.
(22)

As part of this scheme, the defendant AMBER REILLY provided false responses

to many questions on the prior authorizations corresponding to the 51 non-qualifying Hepatitis C

patients described herein. In particular, the defendant AMBER REILLY answered that: (a) all or
substantially all of such 51 patients had qualifying metavir scores and fibrosis scores, whereas in
fact the defendant AMBER REILLY knew that such patients did not have qualifying metavir
scores and fibrosis scores; (b) at least nine patients had not abused illicit substances during the
six months immediately preceding the date of the prior authorization, whereas in fact the
defendant AMBER REILLY knew that such patients had in fact abused, or tested positive for,
illicit substances during such time period; and (c) at least seven patients had allergies to the less
expensive Viekira Pak and, therefore, had to be treated with the more expensive Harvoni,
whereas in fact the defendant AMBER REILLY knew that such patients had no such allergies.
After having answered these questions falsely, the defendant AMBER REILLY faxed the
falsified prior authorizations to TennCare I Magellan.
(23)

As part ofthis scheme, the defendant AMBER REILLY signed the names of

various medical providers to the falsified prior authorizations that she submitted or caused to be

Case 2:16-cr-00107-JRG Document 1 Filed 10/04/16 Page 6 of 8 PageID #: 6

submitted to TennCare I Magellan, even though the defendant AMBER REILLY did not have
authority to sign these medical providers' names to any documents.
(24)

As part of this scheme, the defendant AMBER REILLY submitted to TennCare I

Magellan these altered and falsified prior authorizations, medical lab reports, and drug test
results.
(25)

As a result ofthe defendant AMBER REILLY'S conduct, TennCare paid

approximately $4,398,794 to purchase Sovaldi, Harvoni, Viekira Pak, and Daklinza

prescriptions for these 51 patients. TennCare would not have paid any of this amount if the
defendant AMBER REILLY had submitted to TennCare I Magellan true and accurate prior
authorizations, drug test results, and medical lab reports pertaining to these 51 patients.

COUNT ONE
(Healthcare Fraud, 18 U.S.C. 1347, 2)
(26)

Paragraphs (1) through (25) are incorporated by reference as though fully set forth

in this count.
(27)

From on or about October 6, 2014 through on or about April27, 2016, in the

Greeneville Division of the Eastern District of Tennessee and elsewhere, the defendant AMBER
REILLY, aided and abetted by other people, knowingly and willfully executed or attempted to
execute a scheme or artifice to defraud a health care benefit program in connection with the
delivery of or payment for health care benefits, items, or services that affected interstate
commerce; that is, the defendant AMBER REILLY knowingly and willfully submitted altered
and falsified prior authorizations, medical lab reports, and drug test results for numerous patients
to TennCare I Magellan, which prior authorizations, medical lab reports, and drug test results the

Case 2:16-cr-00107-JRG Document 1 Filed 10/04/16 Page 7 of 8 PageID #: 7

defendant AMBER REILLY knew misrepresented the underlying patients' medical information
in a manner that was material to TennCare's I Magellan's determination as to whether TennCare
I Magellan would pay for the cost of such patients' prescriptions for various Hepatitis C drugs.

In violation of 18 U.S.C. 1347, 2.

Nancy Stallard Harr

United States Attorney

Case 2:16-cr-00107-JRG Document 1 Filed 10/04/16 Page 8 of 8 PageID #: 8