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Author: WorkCompAcademy

Medical Errors Now the Third Leading Cause of Death in the US

A new analysis, published in the British Medical Journal claims that “medical errors” in hospitals and other health care facilities are incredibly common and may now be the third leading cause of death in the United States — claiming 251,000 lives every year, more than respiratory disease, accidents, stroke and Alzheimer’s.

The annual list of the most common causes of death in the United States, compiled by the Centers for Disease Control and Prevention (CDC), informs public awareness and national research priorities each year. The list is created using death certificates filled out by physicians, funeral directors, medical examiners, and coroners. However, a major limitation of the death certificate is that it relies on assigning an International Classification of Disease (ICD) code to the cause of death. As a result, causes of death not associated with an ICD code, such as human and system factors, are not captured.

According to the report in the Washington Post, Martin Makary, a professor of surgery at the Johns Hopkins University School of Medicine who led the research, said in an interview that the category includes everything from bad doctors to more systemic issues such as communication breakdowns when patients are handed off from one department to another. “It boils down to people dying from the care that they receive rather than the disease for which they are seeing care,” Makary said.

The issue of patient safety has been a hot topic in recent years, but it wasn’t always that way. In 1999, an Institute of Medicine report calling preventable medical errors an “epidemic” shocked the medical establishment and led to significant debate about what could be done. The IOM, based on one study, estimated deaths because of medical errors as high as 98,000 a year.

Makary’s research involves a more comprehensive analysis of four large studies, including ones by the Health and Human Services Department’s Office of the Inspector General and the Agency for Healthcare Research and Quality that took place between 2000 to 2008. His calculation of 251,000 deaths equates to nearly 700 deaths a day — about 9.5 percent of all deaths annually in the United States. Makary said he and co-author Michael Daniel, also from Johns Hopkins, conducted the analysis to shed more light on a problem that many hospitals and health care facilities try to avoid talking about.

Kenneth Sands, who directs health care quality at Beth Israel Deaconess Medical Center, an affiliate of Harvard Medical School, said that the surprising thing about medical errors is the limited change that has taken place since the IOM report came out. Only hospital-acquired infections have shown improvement. “The overall numbers haven’t changed, and that’s discouraging and alarming,” he said.

Frederick van Pelt, a doctor who works for The Chartis Group, a health care consultancy, said another element of harm that is often overlooked is the number of severe patient injuries resulting from medical error. “Some estimates would put this number at 40 times the death rate,” van Pelt said. “Again this gets buried in the daily exposure that care providers have around patients who are suffering or in pain that is to be expected following procedures.”

RICO Claims in Comp Cases Struggle in California

The Racketeer Influenced and Corrupt Organizations Act, commonly referred to as the RICO Act or simply RICO, is a United States federal law that provides for extended criminal penalties and a civil cause of action for acts performed as part of an ongoing criminal organization. Beginning in 1972, 33 States adopted state RICO laws to be able to prosecute similar conduct. In order to prevail in a RICO action, a plaintiff must prove a “predicate offense” one of which is fraud. In addition to the predicate offense, a plaintiff must also prove a “pattern of racketeering activity” which requires a showing of at least two acts of racketeering activity. This second requirement opens the doors to fairly broad discovery rights covering practically any history of a target defendant that might prove a pattern of racketeering, an open ended discovery process. Federal RICO allows a successful plaintiff to recover treble damages, plus attorney fees.

The plaintiffs bar has sought to apply RICO laws as a penalty in workers’ compensation claims for at least a decade with mixed results. Conceptually they allege that an employer, carrier or third party administrator concocts a fraudulent scheme that is used over and over to prevent workers from obtaining just benefits.

Plaintiff efforts to succeed at RICO in the federal 6th Circuit (Kentucky, Michigan, Ohio, and Tennessee) ultimately ended in failure. In one the the last tries, a Michigan claimant alleged that employer/carrier defrauded him with “false” medical testimony, and filed federal Racketeer Influenced and Corrupt Organizations Act RICO case, In that case, Brown v. Ajax Paving Industries, 752 F.3d 656 (2014), the United States Court of Appeals for the Sixth Circuit followed the prior ruling in Jackson v. Sedgwick Claims Management Services, a carbon copy of this case, 731 F.3d 556, 558 (6th Cir.2013) (en banc). Essentially in the 6th Circuit, RICO cannot be based on an underlying workers’ compensation claim because the court held that “loss or diminution of benefits the plaintiff expects to receive under a workers’ compensation scheme does not constitute an injury to ‘business or property’ under RICO.”

The effort to win comp related RICO cases then moved to the 9th Circuit (nine western states including California and Arizona) arguably the most liberal Circuit in the federal system. In Laurie Miller et al. v. York Risk Services Group, nine plaintiffs worked as firefighters or engineers for the Phoenix fire department, and York adjusted the department’s workers comp claims. The plaintiffs alleged, in part, that York worked with the City of Phoenix to wrongfully deny or delay their workers comp benefits in violation of the federal RICO Act. York moved to dismiss based partly on the en banc decision from the 6th U.S. Circuit Court of Appeals, which dismissed similar RICO claims against Sedgwick Claims Management Services Inc. That defense did not work in Arizona. Judge Sedwick ruled in 2013 that the employees “possess a property right in their workers compensation benefits under Arizona law,” which allows them to have a property interest under RICO law and the case was allowed to proceed. Before the case went to trial, it was settled at the end of 2015. Thus the ruling was not tested in the 9th Circuit Court of Appeals.

Now there is another 9th Circuit RICO case this time filed in California. John Black, and a group of police officers and fire fighters assert a RICO claim in their third amended complaint involving the City of Rialto and the City of Stockton, CorVel Enterprises, York Risk Services Group and others. These plaintiffs allege “York, CorVel, and Rialto engaged in a pattern of fraudulently denying and delaying legitimate claims in order to lower the liability of the city, while at the same time maximizing the TPA’s revenues (and allowing the TPA to maintain and obtain contracts with other public entities based on their ‘outstanding’ financial performance at the expense of public servants)”

At the end of April, the Federal Judge granted the defendant’s motion to dismiss but gave the plaintiffs leave to amend for the fourth time. The decision was based in part upon a determination that a workers’ compensation benefit is or is not a property right subject to RICO. In a ruling consistent with the 6th Circuit, the federal judge found that it was not a property right until it “vests” after entitlement issues have been resolved. Plaintiffs have 21 days to amend for the fourth time.

It will be important to monitor the City of Rialto case until it reaches its ultimate conclusion.

School District Custodian Arrested for Comp Fraud

Timothy Lowes, 42, of Corona was arrested by Department of Insurance detectives on two felony counts of insurance fraud for allegedly submitting a fraudulent workers’ compensation claim, which netted him $11,489.

While working as a custodian for the Baldwin Park Unified School District, Lowes claimed he suffered an injury to his right shoulder and elbow. Lowes was treated for the injury, but claimed continued pain was limiting his physical abilities.

An investigation and video evidence revealed Lowes was able to lift an all-terrain vehicle into and out of his pickup truck. Department detectives discovered Lowes was involved in CrossFit training and rock climbing during the time he claimed to be injured. Upon reviewing video evidence, Lowes primary treating physician determined Lowes misrepresented his physical limitations and should not have missed any time from work.

Lowes was booked into the Los Angeles County Sheriff’s Department on April 20, 2016. He is currently out on $30,000 bail. Lowes will be arraigned May 11, 2016. This case is being prosecuted by the Los Angeles County District Attorney’s Office.

Valencia Physician Pleads Guilty to $2.4 Million Fraud is Still Licensed to Practice

A Valencia doctor pleaded guilty to federal charges for submitting more than $2.4 million in fraudulent claims to Medicare.

Dr. Gary J. Ordog, 61, pleaded guilty before United States District Judge Fernando M. Olguin to one count of health care fraud. Judge Olguin is scheduled to sentence Ordog on August 18.

According to admissions made as part of his plea agreement, Ordog, a physician specializing in toxicology, specifically admitted he “submitted false and fraudulent claims to Medicare for purported office visits and other services that the defendant, in fact, never provided, including: (a) purported services for Medicare beneficiaries who were deceased well before the purported dates of services; (b) services purportedly provided to beneficiaries on dates and times when the defendant was, in fact, out of the area, including on dates and times when the defendant was outside of the United States; (c) for dates and times in which the defendant claimed to have provided more than 24 hours of services for that date. Defendant, at times, fabricated patient records to support false and fraudulent claims to Medicare”.

He also specifically admitted that he “submitted and caused the submission of approximately $2,435,089.00 in false and fraudulent claims.”

Despite these admissions, Ordog continues to be fully licensed as a physician to practice medicine in California, despite this case, his guilty plea, and prior disciplinary problems with the Board of Medicine.

His license to practice medicine in California was restricted in April 2015 by a condition in the order setting bail. At the time he was required to submit copies of paper billing with written notes and other supporting documents to the Department of Justice for billing submitted to Medicare.

But the following month the Medical Board of California issued an Order Following Completion of Probation indicating that Ordog had completed probation on prior charges against him and his license was “fully restored and renewed/current status and free of probation requirements, effective March 13, 2015.”

Notwithstanding his serial legal and ethical problems the Board of Medicine currently indicates his license is “Renewed & Current” and Ordog is at this moment free to practice medicine in California despite his admission that he committed a $2.4 fraud. He only agreed as part of his written plea agreement that “Defendant understands and acknowledges that as a result of pleading guilty pursuant to this agreement, defendant will be excluded from Medicare, Medicaid, and all Federal health care programs.”  The California Medical Board seems to be slow to respond in any way to his current admitted multi-million dollar fraudulent medical practice.

According to a report by the Center for Investigative Reporting, providers who have been convicted of fraud, or banned from practicing in one health system, have no problem starting a second career in California’s workers’ compensation system. Perhaps Ordog can join the growing list of refugee physicians who just migrate over to industrial patients for a living.

The HHS-OIG and the California Department of Justice investigated the case, which was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. Fraud Section Trial Attorneys Ritesh Srivastava and Niall O’Donnell are prosecuting the case.

Orange County Gardner Jailed for Working While on Temporary Disability

A man was convicted and sentenced in Orange County for committing insurance fraud by working as a gardener while receiving total disability benefits totaling over $29,000.

Alberto Gonzalez, 56, Stanton, pleaded guilty April 28, 2016, to three misdemeanor counts of making fraudulent statements to obtain or deny compensation. He was sentenced to 90 days in the Orange County jail, three years informal probation, and was ordered to pay $150 to the Fraud Assessment Fund. Prior to the plea, Gonzalez paid full restitution by giving the Orange County District Attorney’s Office (OCDA) two cashier’s checks in the total amount of $29,270.29, made payable to the Insurance Company of the West for the loss they incurred.

On June 27, 2012, Gonzalez, who at the time was working as a gardener for MS Landscape, claimed that he was injured on the job when he slipped while standing on top of a fence and trimming a tree. The defendant reported the injury to his employer but continued to work.

On July 5, 2012, Gonzalez complained that his pain was increasing and was sent to a doctor by the employer and a Workers’ Compensation claim was initiated. During the course of the claim, his complaints increased and he convinced the doctor that he could not perform all of his duties as a gardener. The doctor treating the defendant subsequently put Gonzalez on modified duties, which the employer could not accommodate and resulting in the insurance company paying the defendant temporary total disability.

On Aug. 20, 2012, Gonzalez was interviewed by an investigator for the insurance company. At that time, the defendant told the investigator that he had given his side business to his brother and stated he had not actively worked his own gardening business in over a year.

While the Workers’ Compensation case was open and while the defendant was receiving temporary total disability payments, the owner of MS Landscape saw the defendant doing gardening work at Keno’s Restaurant in Anaheim. The employer reported this to their insurance broker and the insurance company investigated the matter. Surveillance video was obtained showing Gonzalez providing gardening services to another business in Cerritos, Alpha Scientific Corporation. The owner of Alpha Scientific Corporation told the OCDA and the California Department of Insurance (CDI) that Gonzalez had provided gardening services for their business since 2007 and continues to currently provide gardening services. The owner of Keno’s Restaurant also verified that the defendant had been providing gardening services for their business in the calendar years 2010, 2011, and 2012.

This case was investigated and brought to the OCDA by CDI. Deputy District Attorney Pamela Leitao of the Insurance Fraud Unit prosecuted this case.

Florida Supreme Court Ends 2009 Legislative Limits on Comp Attorney Fees

There seems to be relentless constitutional challenges to legislative limits to the ever expanding worker’s compensation system. California has seen this play out in the Stevens case which has been resolved in favor of the constitutionality of the SB 863 IMR process. Similar constitutional battles against legislative reform to the rising costs of workers’ compensation coverage are being waged in courtrooms nationwide. These battles seem to define the trend of what might be expected in the industry in the near future.

In a major victory for injured workers and stinging defeat for businesses, the Florida Supreme Court on Thursday struck down a law limiting attorney’s fees in workers’ compensation cases. The story reported in the Miami Herald says that the 5-2 ruling is a setback for business groups who say legal fees drive up the cost of workers’ compensation insurance and threaten Florida’s economy and they must seek help from a reliably pro-business Legislature. The long-awaited decision puts pressure on lawmakers to call a special session in an election year to referee a high-stakes battle between Republican-aligned businesses and Democrat-leaning law firms, two deep-pocketed rivals that are among the biggest contributors to legislators’ political campaigns.

The case before the high court involves a Miami man, Marvin Castellanos, who suffered head, neck and shoulder injuries while working for Next Door Company, a maker of doors and door frames in Miami. The company waged an aggressive defense, but Castellanos won and received benefits of $822.70. His lawyer, who worked on the case for 107 hours, sought a fee of $36,817.50. He received a fee of $164.54, the equivalent of $1.53 per hour under a fee system the Legislature approved in 2009. Under that law, attorneys who successfully represent injured workers are paid 20 percent of the first $5,000 in benefits obtained and 15 percent of the next $5,000 in benefits.

But the question is not only how the fees are calculated, but also who pays the fee. When litigation is filed in Florida for workers’ compensation medical care or wages, the defendants have thirty days to provide the benefit voluntarily. After that point, they become responsible for payment of the fee associated with any benefits provided as a result of the suit. This is commonly called a “prevailing party” fee shifting provision. The Castellanos case involves a fee that was to be paid by the employer, unlike California where it is paid out of the worker’s benefits.

Writing for the majority, Justice Barbara Pariente said the law violates workers’ due process rights under the state and U.S. Constitution because it prevents challenges to the “reasonableness” of legal fees in workers-compensation cases. “Without the likelihood of an adequate attorney’s fee award, there is little disincentive for a carrier to deny benefits or to raise multiple defenses, as was done here,” Pariente wrote. “Virtually since its inception, the right of a claimant to obtain a reasonable prevailing party attorney’s fee has been central to the workers’ compensation law.” By replacing the former “reasonable” standard with a sliding scale of legal fees, Pariente said, “the Legislature has thus eliminated any consideration of reasonableness.”

Workers’ compensation rates in Florida are regulated by the Office of Insurance Regulation, run by Kevin McCarty, who has resigned effective May 2 but who has offered to stay on with no permanent successor in place. “Limiting attorney’s fees has been an important factor in reducing workers’ compensation rates,” McCarty said. “A legislative remedy will be required to prevent significant increases in rates, and we look forward to working with all parties affected to bring about a sensible solution.”

The effect on rates businesses pay for workers’ comp insurance will be clearer in about a month when the National Council on Compensation Insurance, a federal clearinghouse, is expected to submit a proposed rate filing with McCarty’s office. The impact on Florida’s workers compensation system costs is expected to be significant, said Chris Bailey, a spokesman for NCCI.

Owners of Long Beach Trucking Company Face Fraud Charges

Alvin Shin Chen, 54, and Fiona Xilin Chen, 46, both of La Cañada Flintridge were arrested at their home by detectives from the California Department of Insurance and charged with multiple felony counts, including workers’ compensation insurance premium fraud for allegedly cheating their workers’ compensation insurer.

The Flintridge, owners of Metro Worldwide, Incorporated and Pacific Coast Distribution, operate a trucking company at 6901 Cherry Avenue in Long Beach and are accused of attempting to reduce their workers’ compensation premiums by providing fraudulent information to their insurer regarding the number of their employees and what work those employees performed.

Chens Insurance detectives uncovered evidence indicating the Department of paid cash to employee truck drivers to avoid reporting them to the insurer and reduce their payroll tax obligation. Audits of the Chens records found they underreported their payroll by more than $4.7 million. As a result, the Chens’ allegedly cheated their insurer out of more than $1.6 million in workers’ compensation premium.

The Chens were booked into the Century Station and are held on $950,000 bail each. Arraignment is scheduled for April 29 in Los Angeles County Superior Court. The Los Angeles District Attorney is prosecuting this case.

Second Federal Class Action Filed Against Carriers for Alleged “Hacking”

Class action litigation has been pending for nearly a year against Berkshire Hathaway Homestate Insurance Company, its wholly owned subsidiary Cypress Insurance Company, Zenith Insurance Company, the defense lawfirm of Knox Ricksen, LLP, and others.alleging that the defendants illegally “hacked” confidential information about workers’ compensation claimants to use to defend claims pending before the WCAB. This month a second class action has been filed in federal court against essentially the same parties. The new case has received some media attention. However, it does not seem that the second case adds anything new to the factual basis for the first alleged case.

The first federal case was filed by Hector Casillas in June 2015. His second amended complaint was filed in March 2016. He files this as a class action pursuant Federal Rule of Civil Procedure 23. He alleges he was a client of the law firm of Reyes & Barsoum LLP to litigate a worker’s compensation claim.

One of the defendants, Palmdale based HQSU Sign Up Services, Inc. is the centerpiece of the compromised data. HQSU is allegedly paid a pre-negotiated flat fee to provide “administrative services” for clients unable to come to an attorney’s office due to physical, financial, or transportation limitations, and to.assist attorneys signing a retainer agreement and filling out an In-Take Packet with personal information. HQSU then uploads the documents to its allegedly username and password-protected website. Attorneys using this service upload and download other documents to HQSU servers. Casillas alleges that HQSU failed to provide adequate or responsible protections against unlawful access and failed to report the hacking activity so it is sued in the class action along with the carriers.

The alleged “hacking” of the HQSU files was first suspected during an in-chambers hearing in a worker’s compensation case before Presiding Judge Paige Levy. The case was being defended by Knox Ricksen. Knox Ricksen’s attorneys allegedly revealed they had Mr. Casillas’ attorney-privileged In-Take Packet. The attorney first allegedly responded to questions by Judge Levy that it was obtained from the HQSU “website” but later said he did “not know” where it came from. Levy ruled it was attorney client privileged and ordered it to be returned.

Allegedly the downloading of documents from HQ Sign Up compromised approximately 32,500 intake sheets, in addition to the Casillas documents. Plaintiff’s experts have allegedly discovered that the documents were obtained by a “directory traversal attack.” Directory traversal is an HTTP exploit which allows attackers to access restricted directories and execute commands outside of the web server’s root directory. On the other hand, Zenith has argued HQSU intake packet materials were obtained using a Google search of the claimant’s name and thus “were found in the public domain.”

In a motion by Zenith to be dismissed, it’s attorneys claim that the case was before Judge Levy because “Knox petitioned the WCAB for an order allowing certain discovery that Knox asserted may show that a “runner” or “capper” had procured Casillas as a Reyes client and Casillas had fabricated or exaggerated his claimed injuries. Reyes opposed, arguing that the discovery was derived from attorney-client privileged information contained in Reyes’s “In-Take Packet” for Casillas. (One would assume from this motion that Zenith believed HQSU Sign Up Services was suspected of running and capping injury cases for lawyers). In any event Zenith was not involved in the Casillas workers’ compensation case and asks to be dismissed.

Another motion recently filed by defendants seeks to strike the class action allegations claiming Casillas violated Central District local rule 23-3 which requires a motion for class certification to be filed “[w]ithin 90 days after service of a pleading purporting to commence a class action” which expired last October. Casillias replied that the local rule is discretionary, and asks for more time.

An now a second federal complaint has been filed by Adela Gonzalez seeking class action status against the same carriers and others. Gonzalez was also a client of Reyes & Barsoum LLP in connection with a workers’ compensation claim. The facts of the second case are essentially similar to the Casillas second amended complaint. Nothing new is alleged what was not previously claimed. The second case is in its infancy, and no responsive documents have yet been filed by any defendants. Gonzalez does not specifically allege how her case was compromised other than as part of the entire scheme.

At the moment, the controversy seems to essentially be a claim by a client of an applicant lawfirm that approximately 33,000 “In-Take Packets” completed by HQSU Sign Up Services, Inc. were “hacked” by a conspiracy of insurance carriers using a “a directory traversal attack” to download these confidential records that were protected by attorney client privilege from HQSU in violation of law.

On the other hand, the defendants suspect and claim that HQSU was really a runner or capper organization soliciting injury claimants for lawfirms, and that they had approximately 33,000 records of litigants on an insecure website that Google regularly indexed. A Google search of any of the claimants by name in these records would lead to file on the HQSU website that could be downloaded by anyone without hacking anything and thus were in the “public domain.” Since HQSU is a party to this case, no doubt discovery will prove or disprove its status as a runner or capper organization.

San Jose Company Earns Carrier’s 15th Safety Recognition Award

There are regular and seemingly unending media announcements chastising business practices that are purportedly unsafe for workers. Cal/OSHA regularly issues heavy fines for those who violate safety laws. It is not often we hear of an award that is given for an exemplary safety record, especially fifteen years in a row. So here is the “good news” story.

Ultratech, Inc. a leading supplier of lithography, laser­ processing and inspection systems used to manufacture semiconductor devices and high-­brightness LEDs (HB­ LEDs), as well as atomic layer deposition (ALD) systems, recently received its 15th safety recognition award from its workers’ compensation carrier for its exemplary health and safety record.

The award, presented by Ultratech’s Insurance carrier Berkley Technology Underwriters, a Berkley Company, acknowledges Ultratech’s successful efforts to incorporate safety as part of the company’s corporate culture. This recognition includes its facilities in San Jose, Calif., Waltham, Mass. and Singapore.

Matthew Mueller, President, Berkley Technology Underwriters, a Berkley Company, stated, “As a property-casualty insurance provider specializing in the tech industry, we are well aware of what extremes a company might take to protect its most valuable assets, its people. Without question, Ultratech has gone to the utmost to do so. Safety is truly embedded in the culture at Ultratech. We are very proud to work so closely with them.”

“The safety of our employees is built into everything that we do,” noted Arthur W. Zafiropoulo, Ultratech’s Chairman and CEO. “Building on our 15th safety award, Ultratech will continue to find ways to make further improvements. The accolades surrounding this award go to our employees who work to make safety and quality a priority in Ultratech’s corporate culture. In receiving this award, I challenge other companies around the world to make a commitment to improving workplace and employee safety.”

Berkley Technology Underwriters is a global insurance solution provider offering most lines of property, casualty and professional insurance coverage for clients with technology exposure and technology firms worldwide. Headquartered in Minneapolis, MN USA, it is a member company of W. R. Berkley Corporation. Offerings encompass global coverages for first and third-party solutions. It has been accredited as a Coverholder on behalf of Lloyd’s of London. As a Coverholder, Berkley Technology Underwriters is able to secure locally accepted insurance coverage around the world for its U.S. technology clients. Coverage is provided under Lloyd’s licenses through W. R. Berkley Syndicate 1967, a Lloyd’s syndicate underwriting a worldwide portfolio of insurance and reinsurance risks.

GlaxoSmithKline Says Eliminating Kickbacks Has Not Hurt Profits

It has been one of the pharmaceutical industry’s most closely watched experiments: does ending kickback payments to doctors undermine drug sales?  GlaxoSmithKline, the British drugmaker, believes it has proved that raising the ethical bar on marketing practices doesn’t necessarily reduce competitiveness.

GSK Chief Executive Andrew Witty said better-than-expected 2016 first quarter results coincided with a period where the entire group had operated under a new policy that bans payments to doctors who speak on behalf of GSK. “It convinces us that the moves we’ve made are both good for our business and also good for improving the reputation of the industry,” Witty told reporters.

GSK, which was fined nearly $500 million in 2014 for bribing doctors in China, is the first drug company to implement such a broad clampdown on payments to prescribers and competitors are watching closely to assess the commercial fallout.

The former head of the Chinese division of GlaxoSmithKline was charged with corruption in connection with the bribery scandal in which GSK paid off doctors and government officials. In the prior six years Mark Reilly and some of his associates allegedly spent an approximate sum of $480 million on hospitals and its employees, in order to increase the sales of GSK pharmaceuticals in China. Shortly after the allegations against the pharmaceutical company were made public their sales in the Chinese market fell 61%.

GlaxoSmithKline announced it would stop paying doctors for promoting its drugs and scrap prescription targets for its marketing staff – a first for an industry battling scandals over its sales practices, and a challenge for its peers to follow suit. Britain’s biggest drugmaker also said it would stop payments to healthcare professionals for attending medical conferences as it tries to persuade critics it is addressing conflicts of interest that could put commercial interests ahead of the best outcome for patients.

The Chinese authorities were not only investigating GlaxoSmithKline; big international pharmaceutical companies like Novartis International AG, AstraZeneca PLC, Sanofi S.A., Bayer AG und Eli Lilly and Company have also been subjected to greater scrutiny.

In China, GSK’s business is still struggling, with sales down 28 percent in the first quarter, due to disposals of some products and lower prices, but Witty said he expected GSK to return to growth in China in the second half of 2016.

In the United States, the industry’s biggest market by far, many companies have run into conflicts over improper sales tactics and GSK reached a record $3-billion settlement a few years ago with the U.S. government over charges that it provided misleading information on certain drugs.

AstraZeneca said in 2011 it was scrapping payments for doctors to attend international congresses but others, until now, have not followed suit and GSK’s actions go further.

The shift is pragmatic to a certain extent, since many decisions about which drugs to use are now taken centrally by big insurers and governments, based on cost-effectiveness measurements, rather than by individual doctors.