Three West Tennessee residents accused of fraudulently billing the federal government $28.7 million for invalid prescription medication they never dispensed were part of a nationwide health care fraud crackdown.
The owners of a Memphis-based health clinic MedPartners and SarJo Pharmacy purported to treat injured United States Postal Service employees, billing the cost of medications to the Federal Employees' Compensation Act, according to an indictment filed June 12.
But the medication was never prescribed to patients, and the majority of the medications were not carried in stock by the pharmacy. About 500 of the 4,052 claims billed by SarJo Pharmacy between August 2018 and August 2021 were for drugs that were never actually manufactured or available to be purchased, the indictment states.
Collierville residents Kossie Lamon Simmons, 59, and Katina Marzie Simmons, 48, face charges of health care fraud and conspiracy to commit health care fraud and wire fraud, alongside 47-year-old Memphis resident Tritia Margalizita Townsend, who served as SarJo Pharmacy's pharmacist in charge.
Between August 2018 and December 2021, the federal compensation program paid the pharmacy about $16.3 million.
"Kossie, Katina and Townsend personally profited from their participation in the scheme by receiving fraud proceeds for the personal use and benefit of themselves and others," the indictment states.
The trio is among 324 defendants facing charges as part of the U.S. Department of Justice's 2025 National Health Care Fraud Takedown, according to Interim U.S. Attorney Joseph C. Murphy Jr. The operation targeted those with alleged involvement in health care fraud and illegal drug diversion schemes throughout the United States.
ALLEGED SCHEME
Kossie Simmons controlled and managed MedPartners, a health clinic founded in 2016 with locations in Memphis, Nashville and Little Rock, Arkansas, according to the indictment filed in U.S. District Court for the Western District of Tennessee. Kossie Simmons also controlled and managed SarJo Pharmacy, which was founded in 2018 and had one location in Memphis.
Katina Simmons managed and held 70% ownership interest in both companies.
The indictment mentions an unnamed co-conspirator that held 30% ownership interest in both companies. Kossie Simmons, who previously pleaded guilty to health care fraud in 2007 and was barred from participating in any federal health care program for 25 years, exchanged text messages with the co-conspirator in August 2016.
"Been patiently waiting for the planets to come back into alignment from my first go round, now can attack this opportunity with the most valuable weapon of all EXPERIENCE," Kossie Simmons wrote in one text message, according to the indictment.
Katina Simmons enrolled MedPartners as a billing agent for the federal compensation program in August 2016, and enrolled the clinic as a physician office in the program in 2017, though Kossie Simmons was specifically barred from participating in a federal health care program.
SarJo Pharmacy opened in 2018 with Townsend as the only employed pharmacist. Townsend worked one day each week for four hours filling prescriptions for lidocaine and diclofenac, an anti-inflammatory medicine used to treat pain, the indictment states.
The Tennessee Board of Pharmacy began investigating the business in September 2020 and discovered the pharmacy was billing for prescription medications without valid prescription orders. Instead, two nurse practitioners who worked in MedPartners' clinics would determine whether patients were eligible for compounded medications, or medicines created using drug ingredients "tailored to the needs of an individual patient," according to the indictment.
Two other physicians who worked with MedPartners never authorized prescriptions for the medications billed, and the nurse practitioners did not have access to prescription pads, according to court documents.
Investigators executed search warrants on the businesses in August 2021. The businesses submitted 227 more claims between the searches and the end of that year, bringing in another $1.1 million in payments.
Kossie and Katina Simmons each face one count of conspiracy to commit wire fraud and health care fraud, which carries penalties of up to 20 years in prison and a fine of up to $250,000, if convicted. They also face seven counts of health care fraud, which carry penalties of up to 10 years in prison and a maximum fine of $250,000, if convicted.
Townsend faces one count of conspiracy to commit wire fraud and health care fraud and three counts of health care fraud.
Read more at TennesseeLookout.com.
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