Health Care Fraud Blog

A Special Bulletin

By Bernard M. Cassidy

FORT LAUDERDALE, FL (October 12, 2011) The State of Florida and DEA, after spending the last two years dedicating substantial resources to eliminating so called “pill mills” have now turned considerable attention to pharmacies, particularly pharmacies associated with pain management clinics, and targeting pharmacies dispensing of what is perceived as large quantities of opioids such as oxycodone.

This latest law enforcement initiative aimed at pharmacies is in part the result of the shift of distribution of opioids from physician dispensers to pharmacies and from the fact that the DEA and State have been pretty successful shutting down some of what were perceived as the worst pill mills. As with other enforcement actions, criminal prosecutions as well as regulatory actions are sure to follow.

DOH inspections of pharmacies in the State of Florida are going to be increasingly difficult and exacting; and violations previously glossed over and cited on an inspection report for correction are now forming the basis of licensing complaints. This expected uptick in pharmacy scrutiny is another piece of the law enforcement effort to curtail Florida's prescription pain medication diversion epidemic. New statutes have made disciplinary sanctions for failure to properly review and validate prescriptions much more pronounced and has made due diligence by all drug suppliers mandatory.

Florida is also going to focus more heavily on the backgrounds of applicants for pharmacy licenses and subject them to much greater scrutiny. Under new laws, pharmacies and pharmacists are now responsible for reporting of doctor shopping within 24 hours. With the mandatory reporting of controlled substance prescribing and dispensing now in effect, regulators will have a whole new well of information to analyze pharmacy practices.

SOUTH FLORIDA (AUGUST 18, 2011) - The new legislation designing to halt the sale of painkillers and close down the largest pill mill industry in the nation, doesn't target the real source of the problem it seems. Pharmacies, not doctors, sell about 80 percent of the narcotic painkillers that people get their hands on through doctor shopping.

A new state-wide database may cut that problem down, but the startup of the database has been stalled. Officials have rededicated their efforts to have the database up and running later this year. The database is designed to catch patients who jump from one doctor to the next, or who "doctor shop," in order to keep their high prescription narcotic use under wraps. When a patient gives their prescription to a pharmacist, their name, doctor name and prescription drug information will be entered into a computer system. The system will flag any patients who attempt to buy more narcotics within too short a period of time.

SOUTH FLORIDA (AUGUST 17, 2011) - Despite new legislative efforts with stricter regulations on pain clinics and dispensing of narcotic painkillers, deaths from oxycodone overdoses continue to rise in South Florida. Governor Rick Scott believed the state's effort to make it harder for pill mills to operate in the state would decrease the number of deaths from narcotic painkillers. The numbers continue to rise.

The number of oxycodone-related deaths rose from 2009 by about 8 percent. Jim Hall, director of the Center for the Study & Prevention of Substance Abuse at Nova Southeastern University in Davie, feels there won't be much improvement in the numbers until late in the year.

TAMPA, FLORIDA (AUGUST 1, 2011) - The Office of the Inspector General in the Department of Health and Human Services is now calling Tampa, "ground zero for pain clinics and prescription drug diversion." It seems Tampa has taken South Florida's place in the number of pill mill clinics supplying the illegal painkillers trade. Chris Rule of the Hillsborough County Sheriff's office said it likens back to the crack cocaine problem in the 1990s.

The death toll is rising. Out of 277 drug-related deaths in 2009, 199 of those could be attributed to an oxycodone overdose or other cocktailed drugs. And Rule further states that opiate-based painkillers are the easiest drugs to buy on the street these days. In order for the patients or dealers to get the drugs from the clinic, they need only submit to a blood pressure screening or an MRI.

Of the 70 pain clinics located in the county, 35 are in Tampa. Rule says he doesn't feel every clinic is illegal trading in prescription painkillers. Some operate within the confines of the law and "some are shady," he says.

PITTSBURGH, PENNSYLVANIA (JULY 29, 2011) - Three employees, including the medical director and a former registered nurse of the Allegheny Women's Center were arrested and charged with several crimes involving prescription drug mishandling.

Dr. John Barrett, the clinic's medical director allegedly wrote prescriptions under Dr. Alton Lawson's DEA number for years, which Dr. Lawson permitted. One drug in particular, Diethylpropion, was used by another clinic employee, Mark Wagner, for his depression and anxiety. The drug actually treats obesity.

Over the years, Wagner received prescriptions for 20,000 pills. Wagner did not have a doctor/patient relationship with either doctor. Wagner viewed the drugs as payment for extra services he provided for the clinic, such as working overtime. Wagner also allegedly sold prescription tablets to a former registered nurse, Karen Kane who also received several bottles of the same drug.

Allegheny County District Attorney Stephen Zappala is prosecuting the case.

WASHINGTON D.C. - Health care fraud task forces are turning their attention to the executive level of health care enterprises. In an effort to crackdown on those who would perpetrate health care fraud, investigators have begun aiming their efforts at the owners and operators of drug companies, medical device manufacturers, nursing home chains and any health care business involved with Medicare and Medicaid. Senior executives could find themselves facing criminal charges even if they had no knowledge of their company's activities, but were in a position to stop it.

Prosecutors have become fed up with repeated violations, which cost taxpayers more than $60 billion per year and have decided to use enforcement tools that have long been in place, but simply not used. A simple writing of a check to repay the federal funds and a promise not to repeat the offense have been used too often, so now corporate executives must pay closer attention to how their company is billing Medicare and Medicaid lest they find themselves in hot water with the feds.

The crackdown may result in a company's ban from participating in Medicare and Medicaid reimbursements, but the power to ban lies solely with the inspector general, not a judge. The FDA has also begun using the "Park Doctrine" which allows prosecutors to bring criminal charges against executives. Any corporate officer in the chain of command could charged with a criminal misdemeanor if found to have the ability within their power to prevent the fraud.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of Medicare or Medicaid fraud and health care fraud defense. Mr. Malove is available to provide legal representation throughout the United States to individuals charged with committing health care fraud.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity in the area of health care fraud, make sure you contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

FORT LAUDERDALE, FLORIDA - Florida's Governor Rick Scott signed the "pill mill bill" into effect last Friday. The legislation is aimed at the pill pushing clinics that spawn drug addicts, dealers and deaths. Scott wants to end Florida's "dubious distinction" as the "Oxycodone Capital" of the nation.

Particulars of the bill, effective July 1, include a ban on pill sales at doctor's offices and clinics, an automatic suspension of six months for doctors who overprescribe, and penalties for pharmacies and drug wholesalers who fail to report suspicious prescribing activities. By October, the state will have a computer database to log all pain pill prescriptions, making it easier for doctors, pharmacists and law enforcement to monitor illegal activity.

The bill is not without its flaws and exempts pain clinic doctors and anesthesiologists with extra training in pain therapy. Some of these professionals have participated in pill mill activities in the past. Present at the bill signing (done at several different police stations throughout Florida), were members of law enforcement as well as political leaders, including the Mayor of Orange County, Theresa Jacobs and Dr. Jan Garavaglia, the Orange-Osceola Medical Examiner. Also in attendance, relatives who had lost loved ones to pain pill overdoses.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

Mr. Malove has extensive experience in the area of pill mill defense and represents the Florida Academy of Pain Medicine, Florida Academy of Physician Assistants, American Academy of Pain Management, and Florida Society of Neurology and has filed an amicus curiae brief in federal court challenging the constitutionality of the Florida statutes regulating the operation of pain clinics, i.e., pill mills.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of pill mills or doctor shopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious pill mills, doctor shopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

PALM BEACH COUNTY, FLORIDA (May 27, 2011) - Pill mill clinics of Florida provide hundreds of thousands of illegal prescription drugs per year, and law enforcement, from the local and state police to the FBI and DEA, collaborate on full-time task forces to crackdown on the illegal distribution of drugs. Last week, however, the Palm Beach County Sheriff's office and State Attorney Michael McAuliffe targeted pill mills from another perspective, education.

On May 27, the second annual Palm Beach County Prescription Drug Abuse and Pain Clinic Summit was held, with law enforcement, health care professionals, advocates and State Senator Lizbeth Benacquisto, R-Fort Myers in attendance. Benacquisto believes the summit allows law enforcement to prevent pill mill activities before they start and lessen the need for the constant chase of the perpetrators.

Pill mills thrive on patients who become addicted to prescription pain killers typically after having a legitimate need for the medication. The most often abused drug, Oxycontin, carries a high probability of addiction, and ethical doctors cut off patients if the doctor suspects abuse or addiction. Patients often then search for pill mills, run by doctors who abuse their prescription writing privileges and their DEA license to prescribe narcotic pain killers. A crooked doctor can make a lot of money simply by writing illegal prescriptions. "They are doing it out of greed," states Dr. Steve Rosenberg.

The recent crackdown on pill mills is beginning to change the behavior of the suppliers. Some now want a urine test to prove that the buyer is actually a user and not a cop. The street price of some prescription drugs has also increased, and an addict, in many cases, must pay four times as much to get the same high as before.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

Mr. Malove has extensive experience in the area of pill mill defense and represents the Florida Academy of Pain Medicine, Florida Academy of Physician Assistants, American Academy of Pain Management, and Florida Society of Neurology and has filed an amicus curiae brief in federal court challenging the constitutionality of the Florida statutes regulating the operation of pain clinics, i.e., pill mills.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of pill mills or doctor shopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious pill mills, doctor shopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

Fort Pierce, FL - Homero Izquierdo Ruiz could have been imprisoned for a maximum of 10 years for violating Title 18, Section 1347 of the United States Code. Instead, he was sentenced to serve two 39-month incarceration terms (which will run concurrently) on two counts of health care fraud. At the conclusion of his imprisonment, Ruiz will also have three years of supervised release. As restitution, Mr. Ruiz will also pay more than $1,000,000 to Medicare. Click here to read the official court judgment.

Stipulations of Fact in the Guilty Plea

According to the Criminal Complaint filed in US District Court for the Southern District of Florida, Fort Pierce Division, after purchasing Physical Therapy and Fitness in Martin County, Homero Izquierdo Ruiz, 46, of Miami, initiated fraudulent billing practices. The physical therapy practice received reimbursement for its rehabilitation services from Medicare Part A. In eight months from January to August 2010, the practice netted more than $500,000 in reimbursements from Medicare.

Additionally, Ruiz also bought Ebenezer Medical Services, Inc., in Miami Dade, which at one time operated as a pharmacy and received reimbursements from Medicare Part D as prescription drug coverage. When Ruiz purchased Ebenezer in May 2010, it was no longer operating as a pharmacy. Records from Medicare demonstrate that Ebenezer received more than $587,000 during the period of May 14, 2010 to August 13, 2010. Further, 16 doctors attest that Ebenezer filed false claims using their names and National Provider Identification numbers. Four other Medicare beneficiaries also filed complaints that bills listed prescription drugs that they never received.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement targeting healthcare fraud, make sure you contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

PALM BEACH COUNTY, FLORIDA (May 26, 2011) - State Attorney Michael McAuliffe and Sheriff Ric Bradshaw will co-host Palm Beach County's Prescription Drug Abuse and Pain Clinic Summit. The event takes place today, May 26, from 9 a.m. to 12:30 at the Clayton Hutcheson Agricultural Center.

The summit focuses on prevention of the consequences surrounding addiction and prescription drug dealing before they occur.

This is the summit's second year and since that time the number of pain clinics dealing in the illegal prescription drug trade has dropped significantly; due in part to law enforcement's wide-sweeping raids.

In February of this year, as previously reported here, raids of 11 pain clinics spread from Miami to West Palm Beach netted 23 arrests and more than $2.5 million in cash and vehicles. State Attorney McAuliffe believes that integrating the message of public health with enforcement helps officials refine their philosophy and not focus simply on arresting people.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

Mr. Malove has extensive experience in the area of pill mill defense and represents the Florida Academy of Pain Medicine, Florida Academy of Physician Assistants, American Academy of Pain Management, and Florida Society of Neurology and has filed an amicus curiae brief in federal court challenging the constitutionality of the Florida statutes regulating the operation of pain clinics, i.e., pill mills.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of pill mills or doctor shopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious pill mills, doctor shopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

LAKE WORTH, FLORIDA (May 18, 2011) - The DEA's Operation Pill Nation
crackdown thought it was just another pill mill investigation, but in a strange twist the agency also found that Dr. Cesar DeLeon, a Lake Worth physician was not operating the typical pill mill out of his clinic, the Trinity Medical Center. The doctor received methods of compensation other than money for prescriptions; he was sometimes paid with sex.

Dr. DeLeon was indicted for illegal distribution of the narcotic painkiller, Oxycodone, and the DEA's investigation concluded that the good doctor had not only traded illegal prescriptions for addictive controlled substances, but also offered free office visits and money in exchange for sexual favors from patients.

For this unusual method of pill mill operation, Dr. DeLeon faces up to 20 years for each of the 55 counts he was indicted on and a $1,000,000 fine if he is convicted.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

Mr. Malove has extensive experience in the area of pill mill defense and represents the Florida Academy of Pain Medicine, Florida Academy of Physician Assistants, American Academy of Pain Management, and Florida Society of Neurology and has filed an amicus curiae brief in federal court challenging the constitutionality of the Florida statutes regulating the operation of pain clinics, i.e., pill mills.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of pill mills or doctor shopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious pill mills, doctor shopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

PALM BEACH COUNTY, FLORIDA (May 14, 2011) - South Florida, usually a premier destination for those desiring beautiful beaches, fine dining and luxury accommodations has become a major draw for out-of-state drug traffickers seeking, among other drugs, the popular narcotic painkiller, Oxycodone.

The out-of-towners, called "pillbillies" because of their connection to the Appalachian region, buy large quantities of prescription drugs, then head back to their home state to sell them. Local law enforcement resources have become overtaxed due to the large number of these out-of-state defendants frequently caught during a routine traffic stop.

The majority of offenders hail from Ohio, Tennessee and Kentucky and for the last five years, "pillbillies" have clogged up the Broward County court docket, which ultimately hits local residents' wallets. One day in jail costs the county $114 for each jailed defendant.

Florida's past lax regulations regarding prescription meds may have been to blame for the illegal trade gaining a foothold in the state. Florida legislators just recently tightened its grip on the pain management "pill mills," which may be netting more drug traffickers.

Miami doctor Bernd Wollschlager, past president of the Florida Academy of Family Physicians and staunch opponent of pill mills, reported that a pill mill doctor can make as much as $5,000 per day just writing prescriptions.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

Mr. Malove has extensive experience in the area of pill mill defense and represents the Florida Academy of Pain Medicine, Florida Academy of Physician Assistants, American Academy of Pain Management, and Florida Society of Neurology and has filed an amicus curiae brief in federal court challenging the constitutionality of the Florida statutes regulating the operation of pain clinics, i.e., pill mills.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of pill mills or doctor shopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious pill mill defense, doctor shopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

TALLAHASSEE, FLORIDA (May 10, 2011) - Florida's legislature scored a big win with the passage of the bill to target pill mills, prescription drug dealers and users. Supporters of the bill consider the loopholes minor.

House Bill 7095 bill makes provisions for a state prescription database and requires drugstores to log the sale of every prescription pain pill. It does not, however, require doctors and pharmacists to check the database before handing the patient their pills. Mandating a database check could catch abusers through cross-referencing all places where they fill prescriptions.

Certain doctors and practices also fall under an exemption for registration with the database. Board-certified pain specialists, such as anesthesiologists, neurologists and surgeons can dispense pain meds without registering the transaction. Non-exempt physicians must register their office, have an inspection and follow set standards of patient care. With more than one-half of Florida's pain clinics run by board-certified pain doctors, potential for abuse runs high. State officials offer that the class of exempted doctors generally are much less likely to abuse the system.

The last loophole concerns the lack of drug testing for patients. The medical board wanted patients to undergo regular drug screenings if they receive pain medications, but lawmakers struck down the idea in order to get the bill passed. Regular testing could cost patients $44, each or $60 million, collectively, per year.

Loopholes aside, the bill provides stiff penalties for abusers. An automatic six-month license suspension and $10,000 fine awaits doctors found guilty of prescription abuse.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

Mr. Malove has extensive experience in the area of pill mill defense and represents the Florida Academy of Pain Medicine, Florida Academy of Physician Assistants, American Academy of Pain Management, and Florida Society of Neurology and has filed an amicus curiae brief in federal court challenging the constitutionality of the Florida statutes regulating the operation of pain clinics, i.e., pill mills.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of pill mills or doctor shopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious pill mill defense, doctor shopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

COLUMBUS, OHIO (May 9, 2011) - Joining other states with similar legislation, Ohio's licensed doctors support the passage of regulations to curb the 'pill mill' problem and cut the rapid growth of the painkiller-addiction problem in the state. The physicians are also concerned, however, that patients with legitimate pain relief needs could find it harder to come by their drugs, if doctors are worried they'll be targeted for investigation. "Nothing about anything that we're doing is meant to dissuade good physicians," states Richard Whitehouse, executive director of the State Medical Board. Instead, the aim is to give the board more authority to target pill mills.

Ohio House Bill 93 seeks pharmaceutical licensure of free-standing pain management clinics, which is where the majority of patients receive the narcotic pain killers. In addition, doctors would be required to have an affiliation with a local hospital and be board-certified in pain management. Doctors would also have to report any narcotic pain prescriptions written to a state-monitored automated reporting system.

In the past, physicians prescribed strong pain killers mostly to their cancer patients. After reevaluation of pain as the "fifth" vital sign, doctors began to more freely write for pain killer medications. "Now, there's a crisis of drug abuse and diversion," states Dr. Robert Taylor of Ohio State University Medical Center.

Getting rid of the pill mills reduces the problem in part, but addicts and drug dealers may simply shop harder and use out-of-state sources. Taylor feels that although the legislation will help reduce the supply, the demand side of the problem will still be there.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of pill mills or doctor shopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious pill mills, doctor shopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

WASHINGTON D.C. (May 6, 2011) - U. S. Senator Sherrod Brown (D-OH) has introduced the "Stop Trafficking of Pills Act’’ or the ‘‘STOP" Act target patients and drug dealers looking for narcotic pain medications. The Senator wants individual states to take a tougher stance in fighting Medicaid fraud where prescription medications are involved.

Last year Medicaid shelled out $820 million for prescription drugs in Ohio alone last year. Drug seekers use their Medicaid card to go from doctor to doctor and pharmacy to pharmacy, and although Florida boosts the highest number of Oxycodone prescriptions filled yearly, Ohio ranks number two. The Senator claims Oxycodone, morphine and methadone are the increasing deaths and overdoses.

Senator Brown's bill would require patients to "lock-in" their choice of a Medicaid provider and pharmacy, which is already required in many states now. The Ohio Highway Patrol has already been targeting prescription pill couriers on Ohio's interstates. In March alone, more than 1300 arrests were made for illegal prescription pills. One of the biggest corridors, for illegal prescriptions drugs, runs from Detroit, Michigan to southern Ohio before filtering into other states.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of doctor shopping or pharmacy hopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious doctor shopping, pharmacy hopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

NEW ORLEANS, LOUISIANA - Thirty-one counts of Medicare and Medicaid fraud, totaling $12.5 million, were returned by a New Orleans Federal Grand Jury. Health Plus Consulting, Saturn Medical Group, New Millennium Medical Group, plus nine individuals were indicted on counts of health care fraud.

The individuals recruited patients to visit to the clinics for tests that were never performed or necessary. The patients also moved from clinic to clinic, receiving the same unnecessary tests. In exchange for their participation in the scam, the patients received prescription drugs.

Investigators seized two residences deemed "proceeds" from the crimes as well as bank accounts of some of the defendants. Depending on the extent of their individual involvement, defendants face anywhere from 10 years to 230 years imprisonment and fines. The corporations, if found guilty, could be fined as well.

Healthcare Fraud Blog Publisher, Attorney Robert Malove, is an expert criminal trial lawyer as recognized by The Florida Bar. Mr. Malove has extensive experience in the area of health care fraud defense.

Mr. Malove has extensive experience in the area of pill mill defense and represents the Florida Academy of Pain Medicine, Florida Academy of Physician Assistants, American Academy of Pain Management, and Florida Society of Neurology and has filed an amicus curiae brief in federal court challenging the constitutionality of the Florida statutes regulating the operation of pain clinics, i.e., pill mills.

If you, or someone you know is facing prosecution as a result of aggressive law enforcement activity of pill mills or doctor shopping, make sure you hire an experienced criminal defense attorney who is familiar with the issues.

Federal Healthcare Fraud Strike Force teams are currently operating in 9 locations: Miami, Los Angeles, Houston, Detroit, Brooklyn, Tampa, Baton Rouge, Dallas and Chicago.

If you or someone you know is a healthcare provider and in need of serious pill mills, doctor shopping or any healthcare fraud defense, please contact attorney Robert Malove, co-author of the noted treatise, WHITE COLLAR CRIME: HEALTH CARE FRAUD (West)(2010-2011 ed.) to arrange an immediate consultation.

Early in the last decade the federal government began paying substantial attention to the marketing of drugs by manufacturers. Investigations and eventual settlements with Tap Pharmaceuticals ($875 million) and AstraZeneca ($350 million) paved the way for compliance guidance by CMS Office of Inspector General (OIG) published in 2003.

The guidance addressed potentially illegal marketing practices and the connection between marketing practices, kickbacks and false claims. The fraud related to the reporting of pricing by manufacturers to the government as well as the enabling of providers to charge for drugs given to them for free. The kickback issues related to all manner of gifts, grants, research monies paid to physicians to induce them to prescribe particular drugs as well as rebates, unreported discounts on drug products administered by physicians. The investigations and guidance led to a number of changes in the marketing practices of manufacturers to attempt to avoid kickback prosecutions. At the core, bribing doctors, in various ways to write prescriptions for your drugs became dangerous.

Apparently, the message did not get through all the way. Recently there have been a number of settlements and even guilty pleas by pharmaceutical manufacturers, including AstraZeneca ($550 million), Pfizer ($2.3 billion) and Eli Lilly ($1.4 billion) related to other unlawful marketing practices. However, these cases involved the promotion of so called “off label” uses for their drugs, with some allegations kickbacks as well. The Pfizer settlement stems from an investigation instigated by six whistleblowers, who received $102 million from the settlements. The complaint charged that Pfizer sent doctors on all-expense-paid trips to resorts, gave out free massages, and paid kickbacks to doctors, to provide incentives to the doctors for them to prescribe drugs for off-label uses.

There is a question of how effective current marketing efforts are without resorting to outright bribing of physicians to prescribe drugs. In an interesting article, available here, suggests that the current marketing by manufacturers worldwide is not particularly effective, even with increased marketing budgets. Also, the drug industry as a whole is headed for financial trouble with price controls which are likely inevitable. Therefore, it leads to the question of whether some of the discarded and potentially unlawful methods will be finding their way back into use with fines and settlements merely being the cost of doing business.

“Pharmaceuticals Out Of Balance - Reaching the tipping point” is available for download, click here.

In an interesting suit filed against Amgen, the maker of Epogen, as well as two large dialysis clinic chains, Fresenius and Davita, a whistleblower alleges that salespeople for the drug company told clinic operators and physicians working there to prescribe specific dosage levels of the drug Epogen for patients based upon the maximum reimbursement under Medicare for the drug rather than actual patient needs.

Epogen, used to treat anemia, comes in 1 ml vials with various unit doses between 1000 and 10,000 units of the drug. The cost, and reimbursement for the vials, administered to the patients at the clinics, can vary dramatically based upon the unit dosage used. The whistleblower is a former sales manager for Amgen and is also a nurse practitioner. The Federal False Claims Act requires the person bringing the suit on behalf of the federal government, referred to as a Relator, to have first hand knowledge of the fraud alleged. The Relator can receive up to 25% of the amount recovered under the suit.

For more, click here.

Often, we hear that white collar crime is treated differently than other types of crime. However, it is often who commits white collar crime that brings about different treatment. I had a client indicted for fraud related to a DME. Monthly, he would send me articles about large DME companies paying large fines and false claims settlements for the same conduct he was alleged to have engaged in and asked the simple question, “Why am I supposed to go to jail and they don’t?”

People arrested for crimes, and in particular health care fraud can find many rationales for conduct that objectively looks bad; some form the bases for defenses; some are to try to feel better. One reaction is generally the same for nearly all, whether it is speeding or a million dollar fraud, “everyone is doing it.” A variation on that theme, and a fair one is that often individuals and small companies are treated much differently than much larger companies.

In 2004, at the same time Pfizer was negotiating a resolution of a $460 million settlement with the United States for unlawful “off label” uses of its drugs, it also was planning and executing marketing campaigns for other drugs doing precisely the same conduct. The results, a huge fine and restitution, but no criminal charges for individuals. An individual that takes a million dollars in a Medicare fraud scheme is going to jail; as are employees and others most closely associated with that person and the scheme. The world’s largest drug company agreed it participated in a $1 billion in Medicare fraud and pays money. The company, or likely a subsidiary, also plead guilty to a crime, but no person goes to jail. $2 billion is not a small sum, but many sitting in prison wonder why the rules are different.

Currently, the highest dollar “amount of loss” category for sentencing purposes involving fraud is for a loss figure of $400,000,000 or more, garnering a 30 level sentencing enhancement; whereas $1,000,000 or more will get a 16 level enhancement. If someone participated in a scheme with a resulting loss of $1million dollars, they are likely to go to prison for a minimum (without other adjustments) of 41 months. This sentence could be applicable to the person who masterminded the scheme as well as some low level employee who merely assisted. A person who participates in a scheme with a resulting loss of $1 billion would be subject to prison for a minimum of 188 months; however in this case, no one goes to jail. Clients complain, "the rich (corporate defendants) get richer, while the poor (individual defendant) gets prison."

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WASHINGTON, D.C.(September 2, 2009) The U.S. Department of Justice announced the largest health care fraud settlement in history. A landmark $2.3 billion health-care fraud settlement involving Pfizer Inc., has put the pharmaceutical industry on notice that promoting drugs for unauthorized uses won't be tolerated by the Obama administration, government officials and legal experts said.” To read the DOJ press release: Click here

In a case originating in the 1990’s, former pharmaceutical sales representatives for Johnson and Johnson (J&J) alleged 80% of a medication they marketed, Procrit, was used to commit Medicare Fraud; an amount equal to $3 billion for the company as a whole. Sales of the drug were promoted using several methods, all alleged to be illegal. One method was called “the spread.” The spread is the difference between the amount J&J would sell the drug using undisclosed discounts to physicians and hospitals and the amount those providers could claim and receive in reimbursement.

J&J, it is alleged, artificially inflated its prices as reflected in reports to the public and government to increase the spread. Those allegations are actually not new, J&J had previously settled with the United States over that issue. J&J sought to have the case dismissed on that basis and was initially successful. However, the suit also alleges that the manufacturer also engaged in other practices such as providing “discount cards” disguised as kickbacks at $1000 per card for physicians to use to purchase the already discounted drugs. The physicians would then bill Medicare for the full price of the drug even though they had paid next to nothing for the drug. In addition the suit alleges that J&J would pay large grants and speaking fees as bribes to physicians to purchase the drug. Those allegations will be allowed to proceed.

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A Branchburg, NJ, woman, Mary Holloway, age 47, was sentenced in U. S District Court in Massachusetts for violating the Food, Drug and Cosmetic Act for marketing the drug Bextra for uses and dosages that were not approved by the Food and Drug Administration.

According to government prosecutors: From approximately November 2001, through April 2005, HOLLOWAY was employed as a Regional Manager at a pharmaceutical company and was responsible for sales in her region of the drug Bextra. Bextra was a Cox-II inhibitor and had been approved in by the Food and Drug Administration (FDA) in November 2001 for the signs and symptoms of osteoarthritis, adult rheumatoid arthritis, at 10 mgs and primary dysmennorhea at 20 mgs, twice a day as needed. In 2001, the FDA specifically denied the request of the pharmaceutical company to approve it for acute pain, including the pain of surgery. The FDA told the pharmaceutical company that it could not approve it for these other indications because the safety in these other uses had not been established. Specifically, the FDA was concerned about the results of a study in which there was an excess of cardiovascular events in patients who had undergone coronary artery bypass graft surgery and used Bextra.

HOLLOWAY was aware of the FDA’s safety concerns, but that she nonetheless had her sales staff of approximately 100 employees sell Bextra for precisely the uses that the FDA refused to approve. For example, HOLLOWAY trained and encouraged her sales teams to promote Bextra by obtaining protocols from doctors that instructed that Bextra be used for the pain of surgery, an unapproved use, and at 20 mgs, an unapproved dose. HOLLOWAY also instructed her staff to market Bextra for use before, during and after surgery to reduce the risk of deep vein thrombosis, which is a form of life threatening blood clots, even though she knew there were no studies showing that Bextra was safe and effective for this use. Finally, HOLLOWAY encouraged her staff to make false safety claims about Bextra in order to sell the drug.

Holloway was sentenced by United States Magistrate Judge Judith Dein to pay a $75,000 fine and twenty-four months of probation after pleading guilty to an Information charging her with distribution of a misbranded drug.

Many in the healthcare industry and the attorneys who represent them in South Florida notice trends in law enforcement and criminal prosecutions that are logically preceded by increased audit activity. There are generally surges in prosecutions following increased outlays in Medicare and Medicaid spending on services, claims or equipment. Recently, the federal government has dedicated substantial resources, particularly in South Florida , to the prosecutions of physicians and clinic owners alleged to be engaged in fraud related to the administration of HIV medications; these were preceded by increased audits and overpayment demands with regard to most of the physicians and clinics later prosecuted.

With the 2006 amendments to Medicare and the creation of Part D, there was a tremendous surge in prescription drug spending by the Medicare Program, however the audit activity did not really catch up with the increased spending until recently. In South Florida, private Medicare contractors including Integrity Health, Trust Solutions and National Audit, along with the internal units of drug plan insurers have vigorously stepped up activity with fraud units conducting expansive and coordinated and almost search warrant like audits. The targets of these audit investigations often extend not only to pharmacies, but physicians who issue a large number of prescriptions for expensive medications.

The stakes can be quite high. Pharmacy owners, providers and health care administrators should be aware that these audits are not random and are generally a pretext to a referral to law enforcement authorities and should treat an audit like a search, including the use of competent counsel to preserve the provider’s rights and to avoid questioning intended to elicit incriminating information

One recent article indicates that audit activity has detected increased pharmacy fraud is found here.