A Waxahachie anesthesiologist refutes the allegations of health care fraud that led to his Aug. 8 indictment by a federal grand jury in a United States District Court.
However, Adam Gallardo Arrendondo, 56, now faces up to 10 years in prison and a $100,000 fine after being charged with illegal remuneration for health care referrals.
“It is totally bogus and is a totally untrue accusation. This comes from a time when I served as medical director for seven months,” said Arrendondo during an interview Wednesday at his office, Texas Anesthesia and Pain Management Institute, in Waxahachie.
According to the website for the Texas Anesthesia and Pain Management Institute, Arrendondo received his medical degree from the University Autonomous of Nuevo Leon in Monterrey, Mexico. He then interned at Methodist Medical Center in Dallas and finished his residency in anesthesiology at the University of Texas - Southwest Medical Center in Dallas.
Texas Anesthesia and Pain Management Institute is located at 128 N. Highway 77 in Waxahachie and 521 N. Beaton Street in Corsicana. The website notes the office offers "noninvasive, cost-effective treatment for all types of pains."
Arrendondo stated he was hired by R&A Medical Marketing to evaluate medication and conduct research. He noted his role was limited to assessing information that was brought to his office.
"They did something on the side that I was not aware of and I terminated my relationship with them because I saw some odd stuff,” he said.
Arrendondo stated he filed his termination with the company through an email that was sent at 1:30 p.m. on Aug. 1, 2013.
According to the federal indictment, OK Compounding — by way of Pharmacy Providers of Oklahoma —allegedly submitted claims for prescription compounding drugs it dispensed to Medicare, Tricare, and Federal Employees’ Compensation Act beneficiaries.
Tricare provides health care coverage for Department of Defense beneficiaries worldwide, including active duty service members, National Guard, and reserve members, retirees, their families, and survivors. The FECA is a part of the Department of Labor.
The indictment states Arrendondo was hired as a consultant to provide services that included reviewing charts, participating in meeting with pharmacies, developing policies, and answering clinical questions for pharmacy staff. It notes he did not fulfill that obligation.
Instead, the indictment alleges that Arrendondo solicited and received checks in exchange for referring compounding prescriptions to OK Compounding, paid for by federal programs. The two checks were for $10,000 each drawn off of OK Compounding’s ICB Bank and made payable to Arredondo. They were dated Aug. 14, 2013, and Sept. 13, 2013 — well after Arredondo claims he resigned from the role.
Compounding prescriptions are the result of combining or altering ingredients to create a medication tailored to the needs of an individual patient that are not FDA approved.
The indictment further alleges that Arredondo began recruiting other physicians to enter into contracts with OK Compounding through a company he controlled, Taffinder Marketing.
A third check, this time for $30,000, is listed in the indictment as payable to Taffinder Marketing. It was also drawn on OK Compound’s IBC Bank account dated Sept. 13, 2013.
“There is no referral numeration, number one," Arrendondo said. "Number two, Medicare fraud? I don’t take Medicare. Number three, Tricare and Department of Labor, I don’t see those. Back then, I saw one Tricare patient. Tricare is part of the government. It is a VA hospital. They go to the VA. How can I get paid (with) one patient? It’s impossible.”
Arrendondo stated his legal team will submit all documents and information in court and hopes the case will be thrown out as soon as possible.
At this time, all acts are still alleged against Arrendondo, as they must still be proven in a court of law beyond a reasonable doubt to overcome a defendant’s presumption of innocence.
If convicted, he faces a maximum penalty of 10 years in prison and a $100,000 fine.
In a press release, United States Attorney Shores stated, “Illegal payment for health care referrals undermines the integrity of our health care system. The U.S. Attorney’s Office will bring to justice those who engage in health care fraud by exploiting programs that provide care for millions of Americans.”
Assistant United States Attorney Melody N. Nelson represents the United States as lead prosecutor in the case The Federal Bureau of Investigation, the United States Department of Health and Human Services-Office of Inspector General, the Defense Criminal Investigative Service, the Department of Labor-Office of Inspector General, the Internal Revenue Service, and the United States Postal Service-Office of Inspector General investigated the case.