A gynecologist Rita Luthra, M.D. in Springfield, Massachusetts, was indicted and arrested last week in connection with allegedly accepting free meals and speaker fees from a pharmaceutical company Warner Chilcott in return for prescribing its osteoporosis drugs, allowing pharmaceutical sales representatives to access patient records, and lying to federal investigators.Warner Chilcott is a unit of Allergan.
Dr. Luthrow is presumed innocent of all charges and through her attorney she denies them. She was charged with one count of violating the Anti-Kickback Statute, one count of wrongful disclosure of individually identifiable health information, and one count of obstructing a criminal health care investigation by lying to federal agents and directing an employee to do the same. The Indictment also seeks $23,500 in criminal forfeiture which is the amount of payment Dr. Luthra received from Warner Chilcott.
According to court documents, Warner Chilcott, a pharmaceutical company, allegedly paid Dr. Luthra $23,500 to prescribe its osteoporosis drugs (Actonel and Atelvia) from October 2010 through November 2011. On thirty-one occasions, a Warner Chilcott representative allegedly brought food to Dr. Luthra's medical office for her and her staff, and paid $750 to speak with Dr. Luthra for roughly thirty minutes, while she ate. Warner Chilcott also paid to cater a barbeque hosted by Dr. Luthra at her home, and paid Dr. Luthra $250 for speaker training, despite the fact that there are no records where she spoke to any other physicians.
It is alleged that Dr. Luthra's rate of prescribing Warner Chilcott's osteoporosis drugs increased during the time she was paid by the company, and abruptly declined once she stopped being paid by Warner Chilcott. Additionally, it is alleged that Dr. Luthra allowed Warner Chilcott to access protected health information in her patients' medical files without appropriate authorizations.
When Dr. Luthra was interviewed about her relationship with Warner Chilcott by federal agents, she allegedly provided false information to those federal agents and allegedly instructed at least one of her employees to also lie and provide false information to the federal agents.
In related federal cases, Warner Chilcott has agreed to plead guilty to health care fraud and pay a $23 million criminal fine and $102 million to whistleblowers in a qui tam case. In addition, the former CEO of Warner Chilcott was also charged with conspiracy to pay kickbacks to physicians and his case is pending. Three former district managers of Warner Chilcott have agreed to plead guilty to conspiracy to commit health care fraud and other violations.
Lessons of the day. First, when federal investigators come to your office, do not speak to them, do not instruct your staff to do anything or do anything unless and until you seek advice of counsel.
This “lying to federal investigators” portion of the case reminds me of the Martha Stewart case except it involves a physician. I see many cases that proceed criminally because prosecutors have found mistruths during interviews, telling others to not be truthful or altered or destroyed records.
Second, federal and state anti-kickback statutes can be far reaching and are now being prosecuted more aggressively. Massachusetts has state laws that require public disclosure of physician payments and gifts to be reported which allows prosecutors to then see if there are any patterns in prescribing. This probably made it easier for the federal authorities to prosecute this case.
While actual sentences for federal crimes tend to be less than the statutory maximum penalties, the charges Dr. Luthra is facing each come with heavy possible penalties. Worse are the collateral consequences to Dr. Luthra’s medical license, her ability to participate in Medicare and Medicaid programs, her insurance provider contracts, and so on. Even if Dr. Luthra wins the criminal case, the Medical Board can pursue under a lower burden of proof. Further, a qui tam civil lawsuit can be filed.
In other words, a case like this can end or hobble a medical career. For this reason, it is critical to avoid the filing of charges if ever possible. Just the filing of charges starts a chain reaction that makes practicing medicine difficult. Compliance while engaging in marketing or receiving benefits from health care providers or companies is critical. See what the "safe harbor" is when doing marketing in health care. Make sure your practice is compliant and use health care attorneys.
Advice of counsel can be a critical defense in a case. For example, if Dr. Luthra could show that she consulted with an attorney who stated that it was not a violation of law, that could show her good faith and demonstrate that she did not have “scienter” to violate the Anti-Kickback Statute. One of the reasons prosecutors charge defendants like Dr. Luthra with lying to federal investigators is to show that there was knowledge that the conduct was wrong and an attempt to cover it up. Clearly, no one would choose to ruin their medical career over $25,000 in meals and compensation but what everyone was doing in marketing years ago does not pass muster any longer and criminal prosecutions and qui tam cases are being filed with greater frequency.
Posted by Tracy Green, Esq.
Green and Associates