Physicians who consider "telemedicine" or writing prescriptions to patients they have not physically seen or any other unusual arrangement for seeing patients and prescribing medications or supplies should consider a recent case.
In this case, a 78 year old Mississippi physician, Albert
Diaz, M.D., went to trial after the key people in the compounding pharmacy and marketing plead guilty. I often see older or impaired physicians get brought into these arrangements and this case fits the pattern.
On March 2, 2018, after a five-day jury
trial, Albert Diaz, M.D. in the Southern District of Mississippi was convicted of one count of conspiracy to commit health care
fraud and wire fraud, four counts of wire fraud, one count of conspiracy to
distribute and dispense a controlled substance, four counts of distributing and
dispensing a controlled substance, one count of conspiracy to falsify records
in a federal investigation and five counts of falsification of records in a
federal investigation.
On June 8, 2018, Dr. Diaz was sentenced to 42 months in federal prison and was denied bail pending surrender. According
to government evidence presented at trial, between 2014 and 2015, Dr. Diaz participated with others in defrauding TRICARE and other insurance companies by prescribing
medically unnecessary compounded medications, some of which included ketamine,
a controlled substance, to individuals he had not examined. The government's trial evidence claimed that, based on the prescriptions signed by Dr. Diaz, Advantage
Pharmacy in Hattiesburg, Mississippi, dispensed these medically unnecessary
compounded medications and sought and received reimbursement from TRICARE and
other insurance companies totaling more than $3 million.
The government argued that its trial evidence
further demonstrated that in response to a TRICARE audit, Dr. Diaz falsified
patient records to make it appear as though he had examined patients before
prescribing the medications. There was video evidence at trial that also demonstrated Dr. Diaz's plan to not disclose certain information during the audit. It appears that Dr. Diaz's reaction to the audit created evidence that supported criminal intent or intent to defraud.
Attorney Commentary: Others who plead guilty testified against Dr. Diaz and although they were the ones who created the pharmacy and arrangement, physicians are held to a high standard when they allow their license to be used to help perpetuate a health care fraud. There is even a sentencing enhancement for those who have special skills.
Even where the physician makes a small fraction of what the pharmacy makes, the physician can be held liable for the entire amount of the billing resulting from his prescription. The loss amounts are based on billing and collections and can result in exposure to long jail sentences. Even a physician such as Dr. Diaz who had a lifetime of law abiding conduct is not spared a sentence in a case such as this.
