South Bay Doctor Sentenced To Two Years In Prison For Unlawfully Distributing Hydrocodone And Committing Health Care Fraud

SAN JOSE – South Bay doctor Venkat Aachi was sentenced today to 24 months in prison for health care fraud and for distributing hydrocodone outside the scope of his professional practice and without a legitimate medical need, announced United States Attorney David L. Anderson, Drug Enforcement Administration (DEA) Special Agent in Charge Chris Nielsen, Federal Bureau of Investigation Special Agent in Charge John F. Bennett, U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG) Special Agent in Charge Steven J. Ryan, and the California Department of Justice Bureau of Medi-Cal Fraud and Elder Abuse (BMFEA).  The sentence was handed down by the Honorable Edward J. Davila, U.S. District Judge.

Aachi, 52, of Saratoga, pleaded guilty to the charges on March 25, 2019.  According to the plea agreement, Aachi was a licensed physician who operated a pain clinic in San Jose and maintained a DEA registration number authorizing him to prescribe controlled substances.  Aachi admitted that from September 18, 2017, through July 2, 2018, he wrote hydrocodone-acetaminophen prescriptions that were outside the scope of his professional practice and not for a legitimate medical purpose. 

“Dr. Venkat Aachi went from doctor to drug dealer when he prescribed highly addictive painkillers without a physical examination or legitimate medical need,” stated DEA Special Agent in Charge Chris Nielsen. “Regardless of title or degree, no one is above the law.  DEA will hold medical practitioners accountable if they operate outside the scope of their professional practice, putting patients and lives others at risk.”

“Physicians who unlawfully prescribe opioids are directly contributing to the opioid crisis,” said FBI Special Agent in Charge John F. Bennett. “Venkat Aachi violated his oath and the trust of our community by illicitly pushing controlled substances to persons without need. The FBI, along with our local, state and federal partners, will continue to investigate and pursue medical professionals who violate the public's trust and defraud our healthcare system.”

“Aachi abused his medical license to prescribe controlled substances and, as a result, will be serving time behind bars,” said Steven J. Ryan, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “This sentence is a warning to criminals who knowingly commit fraud and perpetuate the nation’s opioid epidemic.”

“The message we are sending today is clear: if you prescribe dangerous drugs in an irresponsible manner, we are coming after you,” said Attorney General Becerra. “Medical professionals should be safeguarding the welfare of their patients, not risking their lives. My office will continue to work with our law enforcement partners to fight against all forms of healthcare fraud in California.”

The plea agreement describes transactions in which Aachi improperly distributed hydrocodone.  For example, in November of 2017, he wrote a prescription enabling a patient to receive 90 hydrocodone-acetaminophen pills.  Aachi did not conduct a physical examination of the patient nor discuss the patient’s pain or response to prior medication.  Aachi acknowledged that he knew the prescriptions were not for a legitimate medical purpose and that he did not write the prescriptions in the usual course of his professional practice.  Aachi also admitted that on July 2, 2018, he falsely submitted to an insurance company a false and fraudulent claim for payment for healthcare benefits, items, and services.  Aachi admitted he acted with the intend to defraud the insurance company.

In filings submitted by the government in connection with Aachi’s sentencing, the government wrote that over the course of just one year, Aachi wrote 5,992 prescriptions for controlled substances, the majority of which were for narcotics.  Further, from September 2017, to July 2018, four undercover law enforcement agents posed as new patients.  They visited Aachi about four times each, and after each visit, they received a prescription for a schedule II controlled substance with little to no physical examination. 

A federal grand jury indicted Aachi on October 9, 2018, charging him with six counts of distributing drugs outside the scope of professional practice, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(C), and one count of health care fraud, in violation of 18 U.S.C. § 1347. Aachi pleaded guilty to one count under each statute.

In addition to the prison term, Judge Davila ordered Aachi to serve 3 years of supervised release and ordered him to pay $82,616.85 in restitution.  Judge Davila ordered Aachi to begin serving his sentence on January 22, 2020.   

Assistant U.S. Attorney Shailika Kotiya is prosecuting the case with the assistance of Andy Ding.  This prosecution is the result of investigations by the DEA, FBI, HHS-OIG, and the BMFEA. Through the BMFEA, the California Department of Justice regularly works with other law enforcement agencies to investigate and prosecute fraud perpetrated on the Medi-Cal program against a wide variety of healthcare providers, including doctors and pharmaceutical companies.