Sullivan County Woman Charged with TennCare Drug Fraud

NASHVILLE – A Sullivan County woman is charged with TennCare fraud for selling prescription drugs that were paid for by the TennCare public healthcare program.

The Office of Inspector General (OIG) today announced the arrest of Blanche Virginia Gragg, 49, of Bluff City. The charges stem from an investigation conducted by the Sullivan County Sheriff’s Office and the OIG. 

Gragg is charged with one count of TennCare Fraud and four counts of delivery of a Schedule III controlled substance within 1,000-feet of public elementary school property.  She’s accused of obtaining a prescription for the painkiller Hydrocodone, which was paid for by TennCare, and later selling a portion of the prescription for within 1,000-feet of Bluff City Elementary School.

“The Sullivan County Sheriff’s Office laid the groundwork for this case and asked for assistance, and that’s the kind of cooperation we’re building statewide,” Inspector General Deborah Y. Faulkner said. “Local officers are usually the first point of contact with some of those who are committing TennCare fraud, and they want to get it off the streets as badly as we do.”

District Attorney General H. Greeley Wells, Jr. will prosecute. If convicted, Gragg could serve up to two years for the TennCare fraud which is a Class E felony while the delivery of a Schedule III controlled substance charge is a Class C Felony, carrying a possible sentence of three to six years per charge.

The OIG, which is separate from TennCare, began full operation in February 2005 and has investigated cases leading to over $3.5 million paid in restitution and recoupment to TennCare, with a total estimated cost avoidance of over $173 million for the TennCare program, according to latest figures.  To date, over 1,400 people have been charged with TennCare fraud.

Through the OIG Cash for Tips Program established by the Legislature, Tennesseans can get cash rewards for TennCare fraud tips that lead to convictions.  Anyone can report suspected TennCare fraud by calling 1-800-433-3982 toll-free from anywhere in Tennessee, or log on to www.tn.gov/tnoig and follow the prompts that read "Report TennCare Fraud."