Saturday, June 16, 2018

Three Orthopedic Surgeons Charged In Los Angeles Federal Indictments Relating to Alleged Kickbacks for Surgeries at Pacific Hospital


Three orthopedic surgeons (David Hobart Payne, Jeffrey David Gross and Lokesh Tantuwaya) have been charged in three separate cases for their roles in alleged kickbacks paid for surgeries performed at now-closed Pacific Hospital. The facts underlying this case were from 2008 to 2013 and this has been a longstanding investigation. The case is pending in the Central District of California in Los Angeles.

All three physicians have plead not guilty.  An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court. 

Monday, June 11, 2018

After Losing At Trial, Mississippi Physician Sentenced to 42 Months in Prison for Role in Prescribing Allegedly Medically Unnecessary Compounded Medications to Patients and for Falsifying Patient Records to Make it Appear He Had Examined Them Before Prescribing

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. 

Monday, June 4, 2018

Los Angeles Clinic Owner, Physician, Office Manager, Insurance Biller and Former Insurance Investigator Indicted for Health Care Fraud. Charged With Billing for Services Not Provided and Giving Patients Free Cosmetic Procedures for Insurance Information.

On May 22, 2018, five people linked to two Los Angeles (San Fernando Valley) clinics were arrested on federal health care fraud charges for allegedly inducing patients to visit the clinics with promises of "free" cosmetic procedures, using the patients' insurance information to submit fraudulent claims to at least eight health insurance companies and then using some of the fraud proceeds to provide patients with the free cosmetic procedures.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

The government’s unsealed Indictment claims that Roshanak (“Roxanne” or “Roxy”) Khadem operated two clinics – R and R Med Spa, which was located in Valley Village until early 2016, and its successor company, Nu-Me Aesthetic and Anti-Aging Center, which operated in Woodland Hills. Ms. Khadem was arrested and charged along with four others:

Dr. Roberto Mariano, 59, of Rancho Cucamonga, a physician who helped operate the clinics; 

Marina Sarkisyan, 49, of Panorama City, who was the office manager at the clinics;

Lucine Ilangezyan, 38, of North Hills, an employee and insurance biller for the clinics; and

Gary Jizmejian, 44, of Santa Clarita, a former senior investigator at the Anthem Special Investigations Unit, the anti-fraud unit within Anthem that is responsible for investigating health care fraud committed against the insurance company. 

Sunday, May 27, 2018

Northern California Pain Management Doctors Agree To Pay $260,000 To Settle Civil Claims Following DEA Inspection Regarding Adequacy of Controlled Substances Records


Drug Enforcement Administration (DEA) inspections can have significant financial repercussions if the logs and records of controlled substances are not properly maintained. A recent case illustrates how this happens and is a reminder for practices and pharmacies to be sure their business is compliant in this regard.  

In January 2014, the DEA inspected the controlled substance ordering and dispensing records relating to Pain Medicine Consultants, Inc., a medical practice which had offices in multiple Bay Area locations (Novato, Pleasant Hill, and Pleasanton). 

The government alleged that the DEA inspection uncovered multiple violations of the Controlled Substances Act, 21 U.S.C. § 801 by the practice and the physicians in the group who have the DEA registrationsThe government specifically alleged that between January 10, 2012, through January 17, 2014, the medical practice and the physicians failed to:

(1) keep and maintain adequate records pertaining to controlled substances, as required by 21 C.F.R. § 1304, et seq.; 

Monday, May 21, 2018

Connecticut Hospital Paid Fines for Stark Law Violations for Renting Space to Medical Practice at Less Than Fair Market Value


On April 24, 2018, after it self-disclosed conduct to OIG, Hartford Hospital in Connecticut, agreed to pay $423,017.45 for allegedly violating the Civil Monetary Penalties Law provisions applicable to physician self-referrals and kickbacks. 

The OIG alleged that Hartford Hospital provided remuneration to a medical practice in the form of office space, where Hartford Hospital charged the practice rent at less than fair market value. The remuneration created a financial relationship between Hartford Hospital and the practice that caused Hartford Hospital to present claims for health services that resulted from prohibited referrals in violation of the Stark law.

Rental arrangements where there are patient referrals need to be reviewed for compliance with Stark and Anti-Kickback statutes. This case is an example of the high fines that can result. Luckily, the self-disclosure likely prevented more severe sanctions such as exclusion or criminal referral. 

Posted by Tracy Green
Green and Associates

Friday, May 18, 2018

U.S. Department of Justice Intervenes in Five Civil Qui Tam Lawuits in Los Angeles Accusing Insys Therapeutics of Paying Kickbacks in Form of Speaker Fees, Meals, Entertainment, Jobs, Etc. to Encourage Physicians Promote Sybsys, a Sublingual Spray Form of Fentanyl


On May 15, 2018, the United States intervened in five “whistleblower” lawsuits that have been consolidated in United States District Court in Los Angeles and accuse Insys Therapeutics, Inc. of paying illegal kickbacks and defrauding federal health programs in connection with the marketing of Subsys, an opioid painkiller manufactured and sold by the Arizona-based company.   The civil claims asserted against Insys are allegations only, and there has been no determination of liability.

The five cases brought pursuant to the False Claims Act were ordered unsealed late last week, as was the government’s complaint in intervention. The United States has separately pursued a number of criminal cases against Insys employees and Subsys prescribers.

The cases allege illegal marketing tactics related to Subsys, a sublingual spray form of fentanyl, an opioid painkiller. In 2012, Subsys was approved by the Food and Drug Administration for the treatment of persistent breakthrough pain in adult cancer patients who are already receiving, and tolerant to, around-the-clock opioid therapy.

The government’s complaint alleges that Insys paid kickbacks to induce physicians and nurse practitioners to prescribe Subsys for their patients. Many of these kickbacks allegedly took the form of sham speaker fees to physicians, jobs for the prescribers’ relatives and friends, and lavish meals and entertainment.

The United States also alleges that Insys improperly encouraged physicians to prescribe Subsys for patients who did not have cancer, and that Insys employees lied to insurers about patients’ diagnoses in order to obtain reimbursement for Subsys prescriptions that had been written for Medicare and TRICARE beneficiaries.

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