Five Physicians Plead Guilty to Health-Care Fraud - An Important Lesson For Physicians

The United States Attorney in Boston recently announced the settlement of a health-care fraud case with five urologists and TAP Pharmaceutical Products Inc., one of the largest U.S. pharmaceutical manufacturers. The government claims that the urologist illegal incentives to prescribe the drug Lupron, TAP in the 1990s. The doctors agreed guilty to health-care fraud and TAP to pay 875 million U.S. dollars to allegations of fraudulent drug pricing andMarketing of Lupron.

TAP markets Lupron for treatment of advanced prostate cancer. The U.S. attorney's office launched an investigation into levels of TAP and marketing of Lupron in 1997, after an HMO, a urologist employed by law enforcement agencies reported that he offered an educational grant, a decision he had made on behalf of the HMO, to exclude coverage for reverse Lupron.

To encourage doctors to prescribe Lupron instead of a cheaper alternative, there TAPDoctors free samples of the drug, worth as much as U.S. $ 40,000, as a kind of volume discounts. The average cost for a monthly dose of Lupron were $ 400 to $ 600 Since Lupron reimbursed under the supervision of a physician, Medicare, which usually do not have to reimburse doctors for medication to be injected 80% of the cost of its administration. The remaining 20% was reimbursed by the patient as a co-pay. TAP are completely determined, and expects that doctors prescribe for their patients free Lupronand then bill the patients and their insurers, the average wholesale price of the drug. That is exactly what the doctors did not.

As a further incentive for physicians prescribe, Lupron, TAP offered them free consulting services, free trips to golf and ski resorts, and disguised the money as "training" that the doctors used to pay for cocktail parties, office Christmas parties, medical equipment and travel expenses. The government described these elements asUse commissions and bribes to influence doctors to prescribe Lupron.

TAP case is likely to have significant impact on the marketing practices that have not only pharmaceutical companies but to all providers of health care. For physicians, the message is loud and clear.

First, doctors must carefully some of the benefits of preserving it, used by the healthcare product and service providers should be verified. The federal government cited as illegal incentives, many of the marketingPractices usually by pharmaceutical companies and other health care providers, including: free products used, free advice, tours, golf and ski resorts and money allegedly used for "training", but for other purposes. Thus, risk-doctors, the free, free products or money from suppliers assume criminal charges and civil liability.

It is a crime under the Medicare-Medicaid Anti-Kickback Statute (42 USC 1320a-7b received), or to ask for payment inExchange and for the order, such as a prescription drug, reimbursable by Medicare and Medicaid. This statute was expanded to apply to all states health programs under the Health Care Portability and Accountability Act (HIPAA).

In respect of civil liability, physicians who knowingly submit false claims for reimbursement by the federal government to civil penalties of up to U.S. $ 10,000 per claim, plus treble damages under the federal False Claims Act (31 USC 3729 -- 3732) occur. AtU.S. $ 10,000 per claim, civil money penalties often reach millions of dollars. For example, recorded by TAP 875 million U.S. dollars over $ 559 million penalty to the Federal Civil False Claims Act liability in the case Lupron settlement.

Second, doctors must determine that the government just pays for their interactions with manufacturers and suppliers of health care products and services. TAP case, the government 's emphasizes increased vigilance in identifying and prosecutingViolations of the statutes of fraud and abuse. In a period of six months (April-September 2001), the government pays more than $ 1.22 billion through both a fine Civil Law and False Claims Act civil settlements.

The physician should be on further development in this area, stay tuned.