This story was originally produced by the Valley News. NHPR is republishing it in partnership with the Granite State News Collaborative.
A 48-year-old Grantham doctor has been indicted on charges that he engaged in illegal drug distribution and health care fraud through a network of treatment clinics he owns in northern New England. The charges link him with another former Grantham doctor who pleaded guilty to Medicare fraud last year and is awaiting sentencing.
Federal prosecutors in Vermont allege that Dr. Adnan Khan distributed drugs “outside the usual course of professional practice” and “without a legitimate medical purpose,” the U.S. Department of Justice said in a news release on Tuesday.
Khan entered a plea of not guilty during an appearance at federal court in Burlington on Tuesday, according to court records.
Khan required that patients pay cash in exchange for their prescriptions, even though many of them were covered by Medicare and Vermont Medicaid, the government alleged in an 18-page indictment filed in federal court in Burlington.
He also allegedly prescribed the drugs knowing that at least some of his patients were abusing and diverting their prescriptions and is alleged to have ordered “medically unnecessary” urine drug testing while seeking “kickbacks and bribes” from laboratories, the government said, “knowing that federal health care programs would be billed for the medically unnecessary tests.”
Khan’s indictment alleges that Khan and a person called “Individual 1” were among “others” who were behind a total of “at least” $6.9 million in fraudulent claims to Medicare and Medicaid on behalf of medical laboratories for a urine drug test “that was not medically necessary and not eligible for reimbursement.” As a result of Khan’s and Individual 1’s false claims, one medical laboratory received payments from Medicare and Medicaid totaling at least $540,000, the indictment said.
Khan did not return a phone message seeking comment on Wednesday and his attorneys did not respond to emails.
In 2016, Khan was joined by former Grantham resident Dr. Steven Powell when Khan was granted site plan approval to open a medical clinic at Sawyer Brook Plaza off Exit 13 in Grantham. Powell, 54, who was formerly affiliated with New London Hospital, pleaded guilty in 2023 to charges that he colluded with accomplices at two purported telehealth companies to submit nearly $2 million in false claims to Medicare.
The indictment against Khan and “Individual 1” suggests the initial case against Powell was part of a larger investigation into fraudulent practices at the medical clinics they operated. Powell had been affiliated with Khan’s New England Medicine and Counseling Associates, telling Grantham town officials that he planned to provide psychiatric services at NEMCA’s Sawyer Brook Plaza office and was identified as chief executive of NEMCA for a scheduled presentation at a medical conference in 2023 two weeks before he was criminally charged.
Powell’s former LinkedIn profile — which appears to have been deleted but was online at the time he pleaded guilty last year — also identified him as chief executive of NEMCA from January 2019 to May 2023.
The LinkedIn profile said Powell had been “chief executive officer for multiple (NEMCA) clinics located in three states, Brought company into full profitability allowing it to be sold to an external investor.”
The indictment against Khan does not identify Powell by name but refers to a doctor it calls “Individual 1” who is “a resident of Georgia” and is alleged to have “partnered with Khan in owning and operating NEMCA.”
Individual 1 operated from NEMCA’s offices in New Hampshire while Khan operated from the clinic network’s offices in Vermont, the indictment said.
Powell worked at New London Hospital for 15 years, but the crime of Medicare fraud to which he pleaded guilty occurred after he was no longer employed at the hospital. He attended medical school in Georgia and is a resident of Alpharetta, Ga., the Justice Department said when it announced Powell’s guilty plea.
NEMCA’s website says it services include alcohol use disorder treatment, addiction medicine and “cosmetic care” such as “botox injections and dermal fillers” and lists offices in Manchester, N.H., Newport, N.H., Rochester, N.H., Rutland, Vt., and Colchester, Vt.
It further says NEMCA is “New England’s premier medical cannabis certifying center for residents of New Hampshire and Vermont,” and assures it can provide a “guaranteed (cannabis) card or your money back!”
Khan is described as a “manager” on NEMCA’s annual report filed April 13, 2024, with the Vermont Secretary of State’s office and as chief executive officer on the business’ annual report filed the same date with the New Hampshire Secretary of State’s office.
Attorneys for Powell did not respond to emails seeking comment on Wednesday. Powell’s sentencing hearing on his guilty plea is scheduled for June 11 in federal court in Concord, according to court records.
According to the indictment, Khan is charged with 12 counts of illegal distribution of a controlled substance; one count of conspiracy to commit unlawful distribution of a controlled substance; one count of conspiracy to commit health care fraud; and two counts of health care fraud.
If convicted, he faces a maximum penalty of 20 years in prison on the illegal distribution counts and a maximum penalty of 10 years in prison on each of the health care fraud counts, the Justice Department said. As a condition of Khan’ s release pending trial, he is prohibited from writing prescriptions for controlled substances.
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