Friday, May 8, 2009

Recent Federal Criminal Cases For Prescribing Controlled Substances

Yesterday, I wrote about the conviction of a Los Angeles physician by a federal jury here in Los Angeles. I also mentioned that prescription drug abuse is a high priority by the DEA. Here are 3 other recent cases from across the country that reflect how these cases are being treated by the government, the nature of the charges and the sentences being imposed. The forfeiting of medical licenses as part of the plea agreement and sentence -- and not letting the state Medical Boards make that decision while considering all mitigating and aggravating factors -- is becoming a more common trend in these cases.

1. Spokane Washington Doctor Sentenced To 9 Months Prison For Prescribing Schedule II Substances For Other Than A Legitimate Purpose And Agreed To Surrender Medical License

On April 27, 2009, Keith L. Hindman, a Doctor of Osteopathy in Spokane, Washington, was sentenced to nine months in prison followed by three years of court supervision after release. Hindman was also ordered to conduct 240 hours of community service and pay restitution totaling over $6,800 to several health care insurance programs, including Medicaid, Premera Blue Cross, Asuris Northwest Health, Molina, and Corporate Benefit Services of America.

Hindman had operated Foundation Medical Clinic in Deer Park, Washington, specializing in family practice medicine and pain management. Hindman also operated a counseling program known as Celebrate Recovery for patients who were abusing their prescription narcotics and/or were using illegal controlled substances.

Hindman was charged with prescribing Schedule II Controlled Substances for other than a legitimate medical purpose and outside the usual course of professional practice and health care fraud. The charges stemmed from the issuance of prescriptions for Oxycontin, Oxycodone, and Methadone to patients who purportedly sought controlled substances for pain management but who instead were using the drugs to feed their drug addictions and for other reasons. The health care insurance programs ultimately paid for the unlawfully prescribed drugs when prescriptions were filled and dispensed by pharmacies.

The sentence followed Hindman pleading guilty to the criminal charges on August 29, 2008. As part of the plea agreement he agreed to forfeit his medical license as well as his DEA registration number, which allowed him to issue prescriptions for controlled substances. Hindman agreed not to seek reinstatement of his license or registration number. In addition, he has closed the Foundation Medical Clinic and no longer operates the Celebrate Recovery program.

2. New Jersey Doctor Pleaded Guilty To Federal Charges For Illegally Selling Prescriptions For Oxycodone Without A Legitimate Medical Purpose

On March 31, 2009, Dr. Pankaj Agrawal, who had maintained a practice at Pennsauken Medical Center, pleaded guilty to federal charges for illegally selling prescriptions for oxycodone (in the form of Percocet prescriptions) without a legitimate medical purpose and outside the usual course of professional practice before U.S. District Judge Robert B. Kugler in Camden, New Jersey. Judge Kugler continued Agrawal’s release on a $500,000 secured bond pending sentencing, which is scheduled for July 10, 2009.

At his plea hearing, Agrawal admitted that between February 2005 and June 2008, he illegally sold bottles of promethazine cough syrup with codeine and numerous prescriptions for Percocet. Specifically, Agrawal admitted that on four occasions between January 2008 and June 2008, he sold prescriptions for Percocet to an individual, who he later learned was a confidential informant (“CI”), in the names of individuals other than that of the CI. For instance, on June 6, 2008, Agrawal sold prescriptions for Percocet in twelve different names that were provided to him by the CI. During each visit, Agrawal did not treat or examine the CI, he admitted.

Furthermore, Agrawal accepted responsibility, as relevant conduct, for the sale of 60 additional prescriptions to the confidential informant or his associates. Additionally, Agrawal admitted that on June 3, 2008, he deposit into a bank account $15,000 in cash that represented proceeds from illegally distributing controlled substances. The unlawful dispensing of controlled dangerous substances charge carries a maximum statutory sentence of 20 years in prison and a fine of the greater of $1 million or twice the pecuniary gain to the defendant. The money laundering charge carries a maximum statutory sentence of 10 years in prison and a fine of $250,000.

In determining the actual sentence, Judge Kugler will consult the advisory U.S. Sentencing Guidelines, which provide appropriate sentencing ranges that take into account the severity and characteristics of the offense, the defendant's criminal history, if any, and other factors. The judge, however, is not bound by those guidelines in determining a sentence. Parole has been abolished in the federal system. Defendants who are given custodial terms must serve nearly all that time.

3. New Jersey Doctor Sentenced To 41 Months Prison For Prescribing Oxycodone Without A Legitimate Medical Purpose

On March 27, 2009, pursuant to a plea agreement, Dr. Philip B. Eatough was sentenced today to the substantial sentence of 41 months in prison for unlawfully prescribing the controlled painkiller oxycodone without a legitimate medical purpose and outside the usual course of professional practice. U.S. District Judge Anne E. Thompson also imposed a $9,000 fine and ordered him to surrender to the federal Bureau of Prisons by June 1 to begin serving his sentence. Eatough also forfeited $120,000 to the government, representing the amount of money he laundered as part of his crimes. Eatough also paid the IRS back taxes of $302,000, including interest and penalties. As part of the plea agreement, Eatough has to surrender his medical license and DEA registration. Judge Thompson stated that the 41-month sentence was based in part for its potential deterrent effect on others.

Eatough, who practiced a pain management clinic in Keansburg, New Jersey, was arrested on an Indictment in October 2007 by Special Agents of the Drug Enforcement Administration. He pleaded guilty in July 2008. Eatough's office manager was also arrested in October 2007.
The government characterized Eatough's clinic as a 'pill mill." The investigation included review of over 1,000 medical files, interviews with hundreds of former patients, dozens of former employees and sending undercover officers to the clinic.

Conclusion: I cannot imagine a pain management clinic -- regardless of how well run and reputable -- that would dare not have a compliance plan, periodic reviews and internal audits. The risks of prescribing controlled substances for pain management are great if there is a showing of no medical necessity. With the DEA sending in undercover officers and the government relying on the drug addict patients who will lie to obtain prescriptions -- the risks are great and it is difficult to control every patient and every patient contact. The protocols must be rigorous and strictly imposed.

Any questions or comments should be directed to: Tracy Green is a principal at Green and Associates in Los Angeles, California. They focus their practice on the representation of licensed professionals and businesses in civil, business, administrative and criminal proceedings, with a specialty in health care providers.


DISCLAIMER: Green & Associates' articles and blog postings are prepared as a service to the public and are not intended to grant rights or impose obligations. Nothing in this website should be construed as legal advice. Green & Associates' articles and blog postings may contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations, and other interpretive materials for a full and accurate statement of their contents and contact their attorney for legal advice. The primary purpose of this website is not the commercial advertisement or promotion of a commercial product or service and this website is not an advertisement or solicitation. Anyone viewing this web site in a state where the web site fails to comply with all laws and ethical rules of that state, should disregard this web site.

The information provided on this website is for informational purposes only. It is not intended to create, and does not create, a lawyer-client relationship with Green & Associates, Attorneys at Law. Sending an e-mail to Tracy Green does not contractually obligate them to represent you as your lawyer, or create any type of client relationship. No attorney-client relationship will be formed absent a written engagement or retainer letter agreement signed by both Green & Associates and client and which specifies the scope of the engagement.

Please note that e-mail transmission is not secure unless it is encrypted. E-mail messages sent to Ms. Green should not include confidential or sensitive information.