Attorney Tracy Green Quoted in Los Angeles Times' Article Regarding USC Gynecologist Under Investigation. Green Is Concerned About Physicians Failing to Perform Proper Gynecological Physicals and Rectal Exams Due to Concern Over Sexual Misconduct Allegations.

Attorney Tracy Green was quoted in an article by the Los Angeles Times published on May 30, 2018 entitled "LAPD begins sweeping criminal probe of former USC gynegologist while urging patients to come forward. This is the type of case that is growing due to the media attention which means the need for due process and the need for a full and complete investigation is even more necessary when a media storm is occurring. 

I pesonally have seen a huge change in how physicians do physical examinations the past ten (10) years. While I will not comment on whether I believe there was any misconduct (unprofessional, malpractice or even criminal), I will say that due to cases like this, physicians are AFRAID of putting their hands on patients.

I just had a women's well women exam and pap smear. The physician - Board Certified Internist and woman with a chaperone present with 10 years of experience and USC residency and medical school - did NOT insert her finger in me to see if there were any tumors or thickening or the usual. Nor did she do a breast exam on me. In addition, I had just had acute diverticulitis with bleeding from the colon (for which I was on Cipro) and she did NOT do a digital rectal. She did not even ask. Physicians are too afraid that someone will say it was for 'sexual gratification' and file a complaint.

I am very concerned about all of this. Physicians and care providers should not abuse their position. However, patients need to be educated that part of proper medical care is inserting a gloved finger in the vagina and is necessary and is part of a proper well women's exam and not just for sexual gratification. Hardly. Doctors can feel tumors, thickening of the tissues, pick up on bleeding, check the cervix, feel for endometriosis, and more (I'm not a physician and did not train as one.) 

Read this article from a well-respected Gynecological Medical Practice on what to expect during a gynecological exam. The article states: "After the Pap Smear test, your health care provider will remove the speculum and perform a bimanual exam to check the health of your ovaries and uterus. This portion of the exam involves inserting a gloved and lubricated finger in to the vagina with one hand. With the other hand, they will press down on your stomach. You will feel pressure and some light discomfort is possible, but again, always tell your gynecologist how you are feeling throughout the examination."


So yes, I was shocked last month when I had a pap smear and there was no finger inserted to check out my gynecological health even though the female internist had a chaperone. (The Gynecologist under investigation had a chaperone always but that did not seem to protect him so physicians are using his case as a reason to do substandard defensive medicine.)

Physicians are scared. Guess what, there are some weird doctors out there but the overwhelmingly vast majority are good competent doctors who get no sexual arousal from putting their finger in a mid-50s white woman lawyer (me). Am I going to complain about the doctor who did not do the job she should? No. Sadly, most of the physicians are doing the same but I am hoping to educate physicians and the administrators to please not give into the fear and educate patients.

Please, let's be smart on how we respond to allegations. Please find out the facts. Please understand the medicine. And let's not scare all the doctors from doing good medicine.

Posted by Tracy Green, Esq.
Green and Associates, Attorneys at Law

"ABUSE OF LOYALTY": Free Press Intervu with White Collar Crime Expert Tr...

Tracy Green, White Collar Expert Interview, on Special Counsel Investigation, Michael Cohen, FEC Issues, Etc. With Free Press Journalist Heidi Cuda

Dateline: Los Angeles, August 23, 2018. Independent investigative reporter and Free Press activist Heidi Cuda interviewed me to break down the prosecution tactics of Special Counsel Robert Mueller and his team. 

This is a "low-tech" interview that we set up impromptu via Skype...so hopefully the lags and tech issues don't bother you too much and you can listen to it like a podcast.

Here's a link to the interview which is posted on YouTube and entitled: "ABUSE OF LOYALTY": Free Press Intervu with White Collar Crime Expert Tracy Green"

I did my best, in a "just the facts, m'am" approach without being partisan to explain how the prosecution thinks and why these cases are so challenging. Regardless of political issues, I'm a believer in due process and I hoped to shed light on why Mueller as Special Counsel has proceeded in this manner so far and what we can expect as citizens watching from the armchair.

By the way, to read Emmy award-winning investigative producer Heidi Cuda's Free Press writings on the Trump-Russia investigation and media accountability, go to: https://maewestside.tumblr.com  

In my view, Heidi's style is unique and reflects her prior life as a music reporter for the Los Angeles Times and her punk rock approach to journalism. This was not her asking me for 5 two-sentence sound bites like I've had in mainstream interviews. She purposefully doesn't give questions beforehand or "practice" and wants it "real." So you'll see us having a conversation (with the informality that happens in normal conversations) from my home office to her home office. It's also different because we are not limited to 3 minutes of air time and luckily, I do not have to shout over other people on a panel. 

Among the highlights from the 40-minute interview: "PAPER DOESN'T LIE": "Particularly in a high profile case, the prosecution can't risk making any mistakes. They need evidence and documents that no one can challenge in court. Whatever case they file, they want to make sure it's gonna be bulletproof." "TRUMP" TACTICS: "Trump doesn't use email. He doesn't even like to use the mail. He likes to have things personally delivered. And he likes to have other people handle the communications. He doesn't appear to be texting. He delegates so it insulates him. When you come to try to make a white collar case...it makes it difficult because he's not leaving a paper trail."

The Fifth. Why Michael Flynn's Lawyer Properly Advised Him to Exercise His 5th Amendment Rights in Response to Congressional Subpoena.

No one should be in favor of overzealous prosecutions. We should also let all people exercise their constitutional rights. Even when we disagree with their politics or actions. The case of Ret. Lt. Gen. Flynn is no different. If anything, we need to be even more careful since this is a high profile case and is related to one of the most important criminal investigations in recent U.S. history. 

If I were Michael Flynn's lawyer and he were subpoenaed to Congress, what would I do? Have him do exactly what was done by his lawyer - exercise his 5th Amendment right against self-incrimination. Doing anything else would be legal malpractice in my view unless there were a solid immunity agreement. Even the request for documents is a problem since there are testimonial issues in identifying and producing documents that relate to his 5th Amendment rights.  

First, don't let a client testify or be interviewed when there's a criminal investigation. Simple. Don't care if he looks guilty. Gotta do it. If you don't it's malpractice or folly. You cannot care about the "optics" or that "someone will look guilty." Clients have a hard time understanding it but it is critical to not give into that type of thinking. I would lay down in the street outside my office in downtown Los Angeles before I'd let a client testify under these circumstances.

I would have Mr. Flynn exercise his 5th Amendment rights for numerous reasons. Let us just use his public FARA filings as one basis since we can review them.  To look at the issue, just take a look at the Mr. Flynn's Supplemental Foreign Agent Registration Act (FARA) filings on 3/7/17. They were signed by him electronically under penalty of perjury. Read them if you like [here's the FARA document search link], type in Flynn, click and see what you think. 

Woman Excluded By OIG Indicted For Health Care Fraud for Failing to Notify Employer Home Health Agency of Her OIG Exclusion

In the past, individuals and entities excluded by the Office of Inspector General (OIG) have usually not been prosecuted for fraud. A recent Indictment shows that the government is going to be more aggressive in pursuing individuals excluded by OIG if they fail to notify their employers of their exclusion. 

If OIG excludes an individual or entity it means that no payment can be made by a federal health care benefit program (or state program that received federal funds) for services provided by that individual. 

The United States Attorney’s Office for the Middle District of Pennsylvania announced on March 31, 2016 that China Scott of Pennsylvania was indicted by a federal grand jury for Health Care Fraud for allegedly failing to notify her employer at Cool Waters, a home health care agency that she was an "excluded person" by OIG. Ms. Scott was excluded by OIG due to two previous health care fraud convictions.

According to the Indictment, between November 2015 and January 2016, Ms. Scott provided home health care services to a disabled individual through her employment at Cool Waters, a home health care agency. Since Ms. Waters is an excluded individual, the home health agency cannot receive payments from Medicare or Medicaid or other federally funded programs for her services and must return any payments. Ms. Scott allegedly failed to notify the agency that she is an excluded person.

Indictments and criminal informations are only allegations. All persons charged, including Ms. Scott, are presumed to be innocent unless and until found guilty in court. The investigation was conducted by the U.S. Department of Health and Human Services.

Attorney Commentary: This is a reminder to those in the health care business to run background checks on their employees, independent contractors, and employees of independent contractors who provide services. And simply because Medicare or Medi-Cal or Medicaid is not being directly billed, there are many government programs through HMO contracts, TriCare and other entities that it is very difficult to tell when a patient is Medicare or Medi-Cal (Medicaid) or TriCare.  

In addition, individuals should also check their background since we have seen cases where individuals were excluded and did not know for reasons such as student loan defaults. Finally, if excluded, individuals and entities need to remember that they must apply for reinstatement. It is not automatic. 

Posted by Tracy Green, Esq.

Court of Appeal Rules In Favor of Defense Challenges to Indictments in Two Orange County Workers Compensation Fraud Cases (Landmark - People v. Ahmed & People v. Charbonnet). Only One Count Left In Ahmed Case and Three Counts Left in Charbonnet Case Unless Prosecutor Resubmits Cases to Grand Jury.

The Orange County District Attorney's Office has been dealt a setback in two workers' compensation fraud cases (known as the Landmark cases) due to amending and adding counts to the Indictments without returning to the grand jury. See the March 10, 2016 decision by the Court of Appeal in People v. Superior Court (Ahmed) (Charbonnet). 

In the Landmark cases -- known as People v. Ahmed (with 3 named defendants) and People v. Charbonnet (which has 12 named defendants), the defenses’ writ to the Court of Appeal has successfully forced the prosecution to have to return to the grand jury if they want to add these additional counts. 

The cases are not dismissed in their entirety but they have been gutted of almost all the individual counts. The Court of Appeal on March 10, 2016 ordered the Orange County Superior Court to vacate its order last year that denied defendants’ motion to set aside the indictment. The Superior Court is now required to issue a new order granting the motion with respect to:

(1) all counts in the Charbonnet indictment except counts 1, 298 and 323; and 

(2) all counts in the Ahmed indictment except count 1 (a conspiracy count to file a false medical claim).  

The court is further directed to, at the prosecutor’s election, order the case resubmitted to a grand jury pursuant to Penal Code Sections 997, 998, and 1009. 

In the federal criminal system, proceeding to grand jury is the usual way to charge a defendant. State district attorney's office rarely go to grand jury and when they do, there are often multiple errors due to the state prosecutors being used to preliminary hearings that allow hearsay evidence, do not require the presentation of exculpatory evidence and other procedural requirements. Prosecutors in multi-defendant fraud cases or complex cases where the defendants are well represented prefer grand juries so the defense attorneys will not have the opportunity to cross-examine the witnesses. 

This short cut does not seem to be serving the prosecutors well in Orange County workers' compensation fraud cases but their office seems to be patient and willing to let the cases take years. The Landmark Indictments are from June 2014. State court judges are also often unfamiliar with the rules governing Indictments and tend to apply the more lax rules governing preliminary hearings and Informations. This is what happened in this case. The details about the original Indictments and the amended Indictments are in the Court of Appeal decision.

San Diego MedTech Consultant Pleads Guilty to Defrauding Investors by Selling Fake Stock in Medical Research Company

Health care investment fraud is on the rise. On February 16, 2016, Oceanside businessman Greg Ruehle admitted to securities fraud (15 U.S.C. §§ 78j, 78ff) involving more than 160 people out of investments totaling nearly $2 million. As part of his plea to securities fraud charges, Mr. Ruehle admitted being hired by local medical research firm ICB International, Inc. (ICBI) to identify investors who could fund their research. 

Instead, Mr. Ruehle collected millions of dollars from investors and used the money for his own gambling and other personal expenses.  Mr. Ruehle disguised and concealed his fraud by issuing the investors fake stock certificates and failing to report the purported “investment” to the company. In a parallel action, the Securities and Exchange Commission today announced civil charges against Ruehle.  

In 2015, some of the investors asked for proof that their money was being used at ICBI.  In response, Ruehle sent them a letter on what appeared to be company letterhead, and purportedly signed by the company’s CEO.  In fact, the letter was a forgery, which was borne out by the fact that Mr. Ruehle misspelled the CEO’s name.  

ICBI remained unaware of these “investors,” and never received a penny of their $1.9 million investments. San Diego-based ICBI’s mission is to develop technologies to transport therapeutic treatments through the blood-brain barrier to treat neuro-degenerative diseases like Parkinson’s and Alzheimer’s disease.  Mr. Ruehle’s plea agreement requires that he forfeit the $1.9 million in proceeds and pay restitution to the victim investors.

Health care businesses and investors need to be vigilent about due diligence when investing in health care businesses. We have seen many investment disputes which were not properly documented and investors were not properly issued shares.

Tracy Green Interviewed About "Blood-Testing Startup Theranos, Inc. Is Trading Blows With the Wall Street Journal"

Legal Broadcast Network recently interviewed Los Angeles attorney Tracy Green, and expert in health care regulatory issues, on the possible outcomes of the dispute between Theranos, a $9 billion valued private biotech company started by Elizabeth Holmes, and The Wall Street Journal.

Theranos is offering a new technology solution to an old problem.  In October, the Wall Street Journal published a report alleging that Theranos’s claims about its transformative diagnostic technology, including needle-free blood tests that yield faster results than industry standard tests, do not hold up. Theranos fired back with a denial, offering a rebuttal to statements in the article and suggesting that the reporter, John Carreyrou, had been trying to “take down” Theranos.

As to the possibility of a libel action against the Wall Street Journal, Green points out that “libel cases are hard to win.” Green is involved in a case involving reporting by John Carreyrou, and she says that he is meticulous in detailing what he does. Green says that an FDA report released this week will affect any decision to sue. The FDA report is a public record, so it would be important in any issue as to the truth of what the Journal printed.

Green also notes that Carreyrou apparently did a good job of cultivating sources—employees and former employees of Theranos. Whether Carreyrou acted in good faith and checked his facts would also be important. Green says that Theranos has been known to be “incredibly secretive.” The company worked in hidden buildings with no indication of what was going on there. Getting information from insiders will be an important consideration, especially if this information tracks with what the FDA reported.

Posted by Green and Associates

Office: 213-233-2260

Telemedicine (Telehealth) Rules Are Changing Slowly and Medical Boards and Payors Are Slowly Adapting. Be Careful to Follow State, Federal and Payor Rules

Today's New York Times has an article about telemedicine (we call it telehealth in California) entitled "Modern Doctors' House Calls: Skype Calls and Fast Diagnosis." It is a worthwhile read.

In my practice, I get calls from physicians and health care providers telling me that "telemedicine is now legal." This is especially common in aesthetic medicine (medical spas) in compliance with a physician or advanced practitioner visit before services are performed. While it is under certain circumstances, the efforts to make medicine like Uber or Lyft will face some challenges from medical boards, malpractice lawsuits, HIPAA compliance, prescribing issues, and insurance companies.

I have seen many physicians, health care providers and psychologists use Skype and FaceTime without researching their compliance and state rules. Remember, telemedicine (telehealth) is simply a valuable tool for providing health care services. 

It is as good as the policies and procedures followed. It is a valuable tool and can be very helpful to patients and practices. 

Here are things to think about if you are providing or plan to provide health care services via telemedicine (telehealth):

1.  If it is a new patient, you will be held to the standard of care for a physician having an in office visit. 

Physicians are held to the same standards and duties associated with practicing medicine regardless of whether they are practicing via telehealth or face-to-face, in-person visits. Your specialty will also come into play. Thus, if you are an internist or family practice physician, that is the standard. 

What if the patient has not had a physican in a certain number of years? How do you rule out other medical conditions?

How will you run labs (urine or blood) or perform other diagnostic studies? If the standard of care is that you take vital signs, how would that be accomplished?

2.  Prescribing is an issue. How will you prescribe for a new patient without a face to face visit? 

The prescribing laws in California for example are different than the telehealth laws and you must comply with them. For example, California requires that physicians perform a “physical exam” before prescribing drugs, and explicitly outlaws prescribing on “the internet” without a prior examination. Will your documentation meet this standard?

3.  Licensing. Most states require that you be licensed in their state. For example, physicians using telehealth technologies to provide care to patients located in California MUST be licensed in California. There are exceptions for consults but that requires that a physician request the consult and the other physician is simply using your review of the patient or medical records as a consultation.

4.  Informed consent. Physicians are held to the same responsibilities of providing informed consent. How will you obtain the written informed consent? How will that be in your file?

There are ways to handle this. The informed consent could be extremely useful to address some of the other issues raised here (the scope of the visit for example and a requirement that the patient go get a full physical and that you are not the primary care physician) but this needs to be thought out.

5.  HIPAA and State Privacy Laws. Physicians are held to the same responsibilities of ensuring the privacy of medical information. Skype and Facetime may not meet those requirements. They are not fully encrypted. There are services that are HIPAA compliant but Skype is not.

6.  Record keeping. Physicians are held to the same responsibilities of medical recordkeeping. 

7.  Malpractice and informed consent lawsuits and Board Complaints. I can imagine that in a couple of years we will see a lot of horror story lawsuits and Board complaints - probably many of them nuisance - simply because physicians and health care providers did not obtain written informed consents, did not follow HIPAA, did not keep good records and/or did not perform physicals or refer the patient for follow up.

8.  Medicare, Medi-Cal (Medicaid) and Private Insurance. Check with your biller on these issues. Medicare is not allowing billing for telemedicine and make sure your biller does not bill for phone or Skype visits or follow-up.

At present, the state laws are often limiting coverage to urgent care telemedicine.

For example, Washington is the 24th state to ensure reimbursement for some telemedicine services, does NOT cover virtual urgent care outside a medical facility.

It is the future but it will be carrier by carrier. UnitedHealthcare announced that by next year it would cover virtual urgent care visits for most of its 26 million commercial members by next year, citing the shortage of primary care doctors and the cost of less than $50 per virtual visit. Anthem will cover virtual urgent care visits for 16 million members in 11 states by the end of this year, and it expects the number to reach 20 million next year. 

Both insurers are relying on third-party telemedicine companies to provide the doctors and the technology platform for the service, just as most health systems do for now. Remember that these patients are already in the system where physicians have access to their records and they have a primary care physician. And the limit currently is for "urgent care." 

I believe that technology will vastly improve patients' lives and reduce the cost of health care. It will take time for us to adapt face-to-face to virtual examinations and get patients, providers, insurers, licensing boards, and malpractice standard of care all on the same page. If you are doing this, take the time to create policies and procedurers and run your plan by a health care lawyer. This is preventive medicine for your own practice.

For information or advice for your own practice, feel free to contact attorney Tracy Green at tgreen@greensasoc.com or 213-233-2260. Be careful out there.

Health Insurance Companies Seek Big Rate Increases for 2016 - How Will This Affect Health Care Businesses and Providers?

Zach Gibson / New York Times

Health care providers need to follow what is happening with health insurance companies: the mergers, the rate increases, the data issues, the complexitites. These mirror what will be happening in the health care industry as a whole. 

Reporter Robert Pear’s article in The New York Times (7/3/15) entitled “Health Insurance Companies Seek Big Rate Increases for 2016” explains how “health insurance companies around the country are seeking rate increases of 20 percent to 40 percent or more, saying their new customers under the Affordable Care Act turned out to be sicker than expected.” Federal officials say they are determined to see that the requests are scaled back.

“Insurers with decades of experience and brand-new plans underestimated claims costs. Blue Cross and Blue Shield plans — market leaders in many states — are seeking rate increases that average 23 percent in Illinois, 25 percent in North Carolina, 31 percent in Oklahoma, 36 percent in Tennessee and 54 percent in Minnesota." 

The Oregon insurance commissioner just approved 2016 rate increases for companies that cover more than 220,000 people. Moda Health Plan, which has the largest enrollment in the state, received a 25 percent increase, and the second-largest plan, LifeWise, received a 33 percent increase.

Jesse Ellis O’Brien, a health advocate at the Oregon State Public Interest Research Group, said: “Rate increases will be bigger in 2016 than they have been for years and years and will have a profound effect on consumers here. Some may start wondering if insurance is affordable or if it’s worth the money.”

Sylvia Mathews Burwell, the secretary of health and human services, said that federal subsidies would soften the impact of any rate increases. Of the 10.2 million people who obtained coverage through federal and state marketplaces this year, 85 percent receive subsidies in the form of tax credits to help pay premiums.

The good news is that there are more insured consumers. There are opportunities for health care providers and businesses. Consumers may buy catastrophic insurance to keep costs low and pay cash for everyday care where they can choose their own physicians. 

The money is going to the insurance carriers. How will the money trickle down from the carriers to the providers?  There is a pent up demand and my physician clients who provide primary care are completely overwhelmed.  This will change but it will take some years for this to adjust and the price levels to become predictable and for providers and businesses to have an idea of what life will be like in 5 years. 

Posted by Tracy Green, Esq.

Green and Associates, Attorneys at Law

Private Investigator Hired Hackers To Obtain User Names Passwords for Emails of People He Was Investigating. Being Sentenced Today For One Count of Federal Conspiracy to Commit Computer Hacking

Anyone tempted to hire an investigator to obtain access to another’s emails or hacks into someone else’s email should know that it is a federal crime. 

In addition, just because you see hacking services “advertised” on the Internet or in email solicitations do not mean that they are legal. Today, June 26, 2015, federal prosecutors are expected to seek a prison sentence of up to six months for a licensed private investigator in New York City, Eric Saldarriaga, 41, who admitted to hacking into emails on behalf of his clients.

Mr. Saldarriaga, age 41, pleaded guilty on March 6 before U.S. District Judge Richard J. Sullivan to one count of conspiracy to commit computer hacking, paid an unidentified overseas firm to secure the login credentials and passwords for the email accounts he wanted access to without permission.

Like many federal cases, the facts occurred years ago. In the plea agreement, Mr. Saldarriaga admitted that over six years ago, beginning in 2009 he found services advertised on the Internet (the “Hacking Services”). He then paid the Hacking Services to provide him with login credentials, including usernames and passwords, for e-mail accounts of numerous individuals he was investigating on behalf of his clients as well as individuals in whom Mr. Saldarriaga was interested for personal reasons. Mr. Saldarriaga then admitted that he unlawfully accessed and reviewed victims’ e-mail communications. In total, Mr. Saldarriaga  admitted that he hired Hacking Services to hack into, and provide unauthorized access to, at least 60 different e-mail accounts. These individuals are the “victims” in this federal case.

Mr. Saldarriaga has been the only one charged with a crime, even though some of those who hired him appear to have been aware of what he was doing. Mr. Saldarriaga's clients are known to have included lawyers, wealthy people and even other private investigators.  Some of the victims of Mr. Saldarriaga's email hacking, like Tony Ortega, a former editor of The Village Voice who has written about Scientology, have been pressing the prosecutors in the U.S. Attorney’s Office to reveal the name of the clients.

The sentence was left up to Judge Sullivan and in sentencing memoranda, the defense sought probation while the prosecutors sought six months of prison. The maximum sentence for this charge is 5 years in federal custody but that is not expected since this is Mr. Saldarriaga’s first offense and he only made $5,000 from these hacking assignments. The assigned Assistant U.S. Attorney argued in a pre-sentencing memorandum that Mr. Saldarriaga's invasion of privacy warranted a stronger punishment than the six months of home detention and three years of supervised probation recommended by the court's own probation department. "Unlike defendants in a gun or drug case, who often act without reflection, there is reason to believe that individuals who engage in hacking and other forms of cybercrime can be deterred by a substantial threat of penalties," he wrote.

Judge Sullivan later sentenced Mr. Saldarriaga to three months in prison because the guidelines showed that economic losses by the victims were minimal. However he noted that the guidelines do not cover the drastic invasions of privacy performed and ordered that Mr. Saldarriaga also serve three months of home detention after his release as a deterrent to others. Two victims who addressed the court requested that sentencing be put off until they discover who paid Mr. Saldarriaga to hack their emails. One of the victims suspected it was the Church of Scientology who has hired investigators before to follow him after he wrote news articles critical of the church. Yet Judge Sullivan noted it was not his job to investigate that matter and that he could not force Mr. Saldarriage to reveal who hired him.

The lesson from this case is that while all attorneys and parties in a case would enjoy having an upper hand by knowing the private communications of others, any such temptation must be resisted. As I tell my clients when they ask me to do something that is not legal in order to gain advantage: “who will be representing you while I am in jail?” Litigation and business/family disputes can be incredibly frustrating especially when the other side is not fair or is incredibly unreasonable. However, ethics and following the law are required and everyone should use legal means to obtain information. There are a wide number of ways to obtain information legally and this should be exhausted in these cases.

Posted by Tracy Green, Esq.

Green and Associates, Attorneys at Law

Largest Health Insuance Companies Are Seeking to Merge in Order to Capture Medicare Managed Care Patients In a Multi Billion Dollar Industry

The Los Angeles Times reports today in an article entitled "Anthem, other health insurers are eyeing consolidation" by Chad Terhune that Anthem (the largest for profit insurer in California) is one of the potential bidders for Humana, Inc. The Los Angeles Times reports that Anthem had annual revenue of  $73 billion and profit last year of $2.6 billion. The consolidation of insurance companies is a trend that has been predicted for years in the health care industry. Humana is sought after due to its expertise in managed care plans for Medicare patients.

What does this mean for providers? There will be fewer carriers and it will be critical to have managed care and insurance contracts with the largest providers as the health care industry consolidates.

Posted by Tracy Green, Esq.

Medical Marijuana Physicians & Businesses Are Attacked By The Feds (IRS) For Taxes Who Disallow Deductions Under Little Known Provision 280E. It's Hitting These Businesses Hard. Don't Let This Catch Your Business By Surprise.

The country’s rapidly growing marijuana industry (including physicians who write the recommendations) has a tax problem.

Even as more states embrace legal marijuana, shops and dispensaries say they are being forced to pay crippling federal income taxes because of a decades-old law (26 U.S.C. § 280E) aimed at preventing drug dealers from claiming their smuggling costs and couriers as business expenses on their tax returns.

The latest audits are not just aimed at dispensaries but at medical marijuana physicians.  Imagine being audited and finding out that all your deductions are being disallowed and you are to pay hefty taxes on gross revenue even if seventy-five percent of it went to pay employee wages, rent, supplies, costs of goods sold, etc. You get the picture of what the IRS is doing here.

Congress passed that 280E in 1982 after a cocaine and methamphetamine dealer in Minneapolis who had been jailed on drug charges went to tax court to argue that the money he spent on travel, phone calls, packaging and even a small scale should be considered tax write-offs. The provision, still enforced by the I.R.S., bans all tax credits and deductions from “the illegal trafficking in drugs.”

This has caught many in the medical marijuana business including physicians by surprise. Many people invested in dispensaries only to find out this fact after they invested millions of dollars.

Here is the text of 26 U.S.C. § 280E, Expenditures in connection with the illegal sale of drugs:

“No deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances(within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by Federal law or the law of any State in which such trade or business is  conducted.”

This week’s New York Times article on this issue by Jack Healy highlights the issues. “Marijuana business owners say it prevents them from deducting their rent, employee salaries or utility bills, forcing them to pay taxes on a far larger amount of income than non-marijuana businesses with the same earnings and costs. They also say the taxes, which apply to medical and recreational sellers alike, are stunting their hiring, or even threatening to drive them out of business.”

The gap between the federal position on this issue and the states is hitting business owners hard. Remember that 23 states, plus the District of Columbia, allow medical or recreational marijuana. The federal government does not and this affects businesses in many ways.  For example, banks will not allow medical marijuana businesses to have accounts since marijuana possession is a federal crime in national parks (including those in California and Colorado).

As Jack Healy of the NYT writes, while “President Obama and top federal officials have allowed states to pursue legalization, marijuana advocates say the dissonance between increasingly permissive state laws and federal prohibitions is creating a morass of complications and uncertainty.” It is time for the federal government to not use this as a revenue generator but to engage in fairness and consistency. The tide is turning and this is nothing less than extortion on small to medium size businesses since they know that large companies have avoided this business for this exact reason. Either that or the medical marijuana business needs to get together and lobby Congress on a states’ rights issue which is certainly popular in the South and Southwest.

If you are in this business or are audited by the I.R.S., it is critical that you hire an accountant and lawyer familiar in this field. Do not go to any audits on your own. Be prepared for these issues and think ahead. In addition, get involved politically and make this madness stop.

Posted by Tracy Green, Esq.

Green and Associates, Attorneys at Law

800 West 6th Street, Suite 450

Los Angeles, California 90017

Office: 213-233-2260

Mobile: 310-710-6434

Email: tgreen@greenassoc.com

Green and Associates' Toy Drive for Children With Autism & Developmental Challenges

TOY DRIVE TIME! 

Donate new unwrapped toys for low income children with autism & developmental challenges serviced by one of our favorite nonprofit and multidisciplinary clinic Professional Child Development Associates for speech, OT (occupational therapy), music therapy, social skills, feeding therapy, and psychological counseling. 

You can drop off at our office in downtown Los Angeles or just have it shipped to our office. If you drive to our office, let us know and we will come and meet you in the parking garage to make it easy for you.

If you read our blog and get some benefit and want to show your gratitude -- this is a way to do it. Or if you have gotten free consultations from our office, here's a great way to show your gratitude with a donation of a new unwrapped toy. 

Developmental toys preferred with no batteries. Great toys can be found for under $10. Toys or gifts needed for all ages 1-18.  

From now till Dec 21. Thanks and happy holidays!

Call us at 213-233-2260 and we will arrange for pick up or drop off.

Posted by Tracy Green, Attorney and Advocate for children with special needs.

Health Care Attorney Tracy Green Quoted in USA Today Article On Chiropractors Being One Largest Medicare Billers. Article Is Result of CMS Releases for First Time Data On Medicare Payments For 2012 By Provider.

Ever since Medicare decided last month to release its 2012 data showing all the payors (physicians and other suppliers), journalists have been reviewing the data and trying to determine how certain providers are getting paid such large amounts. The CMS website has all the data in an Excel spreadsheet that can be downloaded and each physician and supplier can be searched. It's actually an incredible disclosure of private information in that physicians' and suppliers' addresses are there as well as their collections.

I must admit that I searched for my own clients to let them know what the data revealed and gave my clients a heads' up that they may get calls from reporters (which happened in a couple of cases). But providers should review this data so they know what is there. Technically, this is private information but be aware that your patients, employees, friends, ex-spouses, et al., can review this to see your gross collections (of course it does not address

For many of the physicians and suppliers, the numbers are misleading since the billing may reflect an entire group that is being billed under the name of one owner. For others it may be an accurate reflection. However, this is the first time the collections have ever been revealed. The New York Times has posted a link that allows one to search by provider name.

One of the questions that arose is how are chiropractors such a large Medicare group and why are their billings so high? USA Today looked at chiropractors and in the article entitled "Some Chiropractors Making Big Medicare Paid Adjustments," I was quoted on why chiropractors are being looked at in particular. This reporter's editor was particularly interested in chiropractors.

My quote was:

"Los Angeles health care lawyer Tracy Green has represented many chiropractors and says the specialty has "a fair amount of regulatory problems and fraud." Part of the problem is that "they are the ones doing the care" frequently in auto insurance fraud cases and some run pain management clinics, a field that's closely watched given all the pain medication abuse and fraud."

Although it doesn't reflect fully my comments, it is important for providers to see where they are in this list and how they rank compared to similar providers since it will be used as a source of audits and scrutiny. There is no question that physical therapy and chiropractor providers will be at risk for more audits since the charting requirements are incredibly strict and CMS often challenges on medical necessity.

Posted by Tracy Green, Esq.
Green and Associates, Attorneys at Law
Los Angeles, California 90017
Phone: 213-233-2260
Email: tgreen@greenassoc.com

Medical Board of California Appoints New Interim Executive Director After Retirement of Linda Whitney After 37 Years

The Medical Board of California announces the appointment of Kimberly Kirchmeyer as its new interim executive director. Ms. Kirchmeyer has been with the Medical Board since 1999, and was deputy director from 2005 to 2009. In late 2009, Ms. Kirchmeyer left the Medical Board for approximately two years and served as deputy director of Board and Bureau Relations for the Department of Consumer Affairs. She returned to the Medical Board in June 2011 in her prior position as deputy director.

Kimberly Kirchmeyer succeeds Linda Whitney, former executive director of the Medical Board, who retired this month after 37 years of state service. Ms. Kirchmeyer begins her new position immediately.

An executive recruitment and search committee is working with the Department of Consumer Affairs to find a permanent Executive Director.

Attorney Commentary Regarding Medical Board

The California Medical Board is undergoing a great deal of change and pressure in today’s political climate. Ms. Kirchmeyer will be the interim director while they search for a new Executive Director. I expect the climate with respect to the discipline of physicians and other health care professionals to become more aggressive, consumer-oriented and proactive in its investigations.

Posted by Tracy Green, Esq.

Ms. Green is an experienced California Medical Board attorney who represents physicians, nurses, pharmacists and other health care professionals in licensing, civil, administrative and criminal investigations, criminal prosecutions and board proceedings. To discuss your particular situation, call 213-233-2260 or email tgreen@greenassoc.com.  The firm website is www.greenassoc.com

County Of Los Angeles Award Given To Attorney Tracy Green

The County of Los Angeles recently gave an award to attorney Tracy Green for efforts above and beyond in a two strikes criminal case involving a young adult who was developmentally disabled and was facing revocation of felony probation with state prison time and a second criminal case where the best offer had been 7 years' state prison with a second strike. Ms. Green spent a year on the case, announced ready for trial, and was able to obtain reinstatement of probation, dismissal of the strike, and probation on the new case.

The result in the case was also due to presenting a vigorous defense and mitigation package to the Los Angeles County District Attorney's Office which was willing to work in this case and being before an excellent judge in the Los Angeles County Superior Court. It takes a great deal of work and coordination in cases involving criminal defendants who are developmentally disabled.

Tracy Green Nominated For 2013 "Women Making A Difference Award"

The Los Angeles Business Journal held its twenty-first annual Women Making a Difference Awards Reception and Luncheon event at the JW Marriott Hotel at L.A. Live in Los Angeles on Wednesday, May 14, 2013.  It was an uplifting and inspirational event, with an impressive group of Los Angeles based women who are leaders in business and the community.

Tracy Green of Green and Associates was nominated in the category of Volunteer of the Year Award, and was honored to be nominated as part of an impressive group of women leaders in Los Angeles.

Tracy Green Interviewed On Plea Bargain Agreements In Criminal Justice System By Santa Monica Daily Press

Tracy Green was interviewed in the Santa Monica Daily Press  as part of their story entitled "Family fights plea bargain in deadly hit-and-run" regarding the role of plea bargains in the criminal justice system. The fact is that approximately 95% of all cases plea before trial.  While most clients come to our office looking to prevent or defend a case, it is important to understand the role of plea negotiations in the criminal justice system -- both federal and state.

The article touched briefly on some of Ms. Green's beliefs and strategy as it relates to negotiating and/or considering a plea bargain for her clients, as part of case strategy.  The article did not quote Ms. Green's statement to the reporter that she "believes the system is broken" and that pleas are used to process the huge numbers of cases that are filed each year. Often pleas are offered in weak state cases that offer a "guaranteed" result and help avoid the risk and expense of trial.

Scott Burns, the executive director with the National District Attorneys Association, explained it well in the article: “The reality is that there are between 15 and 20 million non-misdemeanor cases prosecuted in America every year.” Mr. Burns added: “If each of those, or frankly half or a third of those, went to trial, we would need a much, much larger criminal justice system.” Instead, attorneys forge plea bargains, agreements that offer a potentially lighter sentence in exchange for a guilty or no-contest plea.

The article also stated: "They also offer security, said Tracy Green, a private defense attorney based in Los Angeles.  Whereas plea deals are negotiated between the attorneys involved, jury trials rely on a body of 12 unknowns, making the process a roll of the dice for both sides." I hate to tell people it's like going to Las Vegas, but justice can come at a price," Green said." 

"Defense attorneys also look at the merits of the case, but also determine if it’s a financial possibility for their client to go through the expensive trial process and if they’re capable of serving time, even a reduced amount, Green said."

“What are the client’s goals? Can they risk, handle or afford emotionally or lifestyle-wise any threat of incarceration, or having a conviction of what’s been charged?” she asked. “What’s the downside risk if you go to trial and lose?”

While neither attorney believes that the system is broken, Burns was more apt to defend it than Green, who felt that defendants risk getting a harsher sentence if they go for a trial and lose." It is now considered "below the standard of care" for an attorney not to explain the benefits of early plea negotiations to targets of investigations and persons charged with a crime -- especially in the federal system. Thus, any experienced criminal defense attorney should explore these issues and explain the system to their client without fear of looking "weak" or that they are "not a fighter." These are complex issues and each person's case and situation may be different. 

Some clients are concerned that discussing plea bargains is a sign of weakness but it is a tool to be used. For example, if we have a professional client who is charged with a felony it is important to address all potential strategies including going to trial, the risks if the trial is not successful and whether a certain result (such as a misdemeanor plea by a corporation) may make sense given the facts and risks. Each person or business entity have different goals and different ability to absorb risks. 

To be conscious of the role of plea negotiations is important. It is unfortunate that there are many people who plea because it is in their best personal and business interest rather than risk going to trial, but if it is to be done it should be explored in detail, addressed throughout the process and not simply done at the last minute when there is fear of going to trial. This requires an assessment of the facts, legal exposure and personal issues faced by the client.

Posted by Tracy Green, Esq. 
To speak with Ms. Green, you can email her at tgreen@greenassoc.com or call for an appointment at 213-233-2260.

Can Hospital Chains Improve the Medical Industry? Interesting Article In The New Yorker

One of my favorite writers on health care is Atul Gawande, M.D. (author of "The Checklist Manifesto" which I highly recommend to all health care professionals and other professionals). He has a recent article in The New Yorker magazine that I highly recommend entitled "Big Med: Restaurant Chains Have Managed To Combine Quality Control, Cost Control and Innovation: Can health Care?"

Read this article when you have time and think about how you would apply it to your own practice or business. How do you deliver a range of medical or other professional services to people at a reasonable cost and with a consistent level of quality? Can the innovations in other industries be applied to health care?

Posted by Tracy Green, Green and Associates, Attorneys at Law
Email: tgreen@greenassoc.com
Phone: 213-233-2260