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Feds: Ex-Lodi HS Teacher Admits Scamming Insurance Out Of $550,000 For Compound Meds

Lodi High School
Lodi High School Photo Credit: GoogleMaps

A now-former Lodi High School teacher admitted that he collected $550,000 worth of compound medications through bogus claims to an employee benefit program.

Jason Nardachone, 51, of Nutley bribed three other teachers $500 a month each to obtain compounded medications that they, like him, didn’t need, Acting U.S. Attorney Rachael A. Honig said.

Some of the unnecessary compounded medications – for vitamins and pain and scar creams -- cost the New Jersey School Employees’ Health Benefits Program (SEHBP) $3,300 to $22,800 apiece, she said.

All told, Nardachone and his accomplices defrauded the benefit program of $564,754, the U.S. attorney said, without explaining how it was done.

Honig also didn’t say what prompted the fraud. Authorities have noted that compound meds, because they’re expensive, are popular on the black market.

Compound medications are created by licensed pharmacists, physicians and others for a variety of reasons. These include when a patient can’t tolerate commercially available drugs because of an allergy, when a shortage occurs, when the medication is discontinued or they simply can’t handle pills.

Some of the drugs aren’t manufactured in the refigured form – including the diabetes medication Metformin, which can be compounded into an ointment. Blood pressure and cholesterol fighting pills can be crushed into powder and dissolved in liquid.

Antidepressants, anti-anxiety medication, allergy pills and antibiotics can also be compounded, as can drugs designed to treat thyroid and gastrointestinal issues.

Rather than face trial, Nardachone took a deal from the government, pleading guilty Wednesday via video conference with U.S. District Judge John Michael Vazquez in Newark to conspiracy to commit health care fraud.

Vazquez scheduled sentencing for Feb. 1, 2022.

Honig credited special agents of the FBI with the investigation leading to the guilty plea secured by Assistant U.S. Attorney Joshua L. Haber of her Health Care Fraud Unit in Newark.

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