Author: WorkCompAcademy

The U.S. House of Representatives passed “right to try” legislation that would allow people with life-threatening illnesses to bypass the Food and Drug Administration to obtain experimental medications, ending a drawn-out battle over access to unapproved therapies.

Now the legislation needs approval from the Senate. If so, President Trump is expected to quickly sign the measure, which was praised by supporters as a lifeline for desperate patients but denounced by scores of medical and consumer groups as unnecessary and dangerous.

The FDA would be largely left out of the equation under the new legislation and would not oversee the right-to-try process.  Drug manufacturers would have to report “adverse events” — safety problems, including premature deaths — only once a year. The agency also would be restricted in how it used such information when considering the experimental treatments for approval.

Patients would be eligible for right-to-try if they had a “life-threatening illness” and had exhausted all available treatment options. The medication itself must have completed early-stage safety testing, called Phase 1 trials, and be in active development with the goal of FDA approval.

One Congressman opposing the bill argued that eliminating FDA oversight would “provide fly-by-night physicians and clinics the opportunity to peddle false hope and ineffective drugs to desperate patients,” noting that the bill is opposed by over 100 patient advocacy and consumer groups.

Right-to-try laws exist in 40 states — including California. But this federal bill would introduce legislation across state lines. Right To Try was signed into law in California (Assembly Bill No. 1668) by Governor Jerry Brown on September 27, 2016. It allows very sick patients to plea for experimental treatments directly from drug companies, instead of waiting for years for drugs to hit the market or asking the Food and Drug Administration for early access.

But patients and advocates said the California law does not function well without a federal counterpart. As it stands, if someone experiences adverse effects while taking a drug acquired through California’s Right to Try policy, the FDA can pull the treatment from the clinical trial process. The mismatch has made drug companies reluctant to participate.

The federal right to try law would make California law more effective, or eliminate the need for the California law altogether

This month, the California Supreme Court issued an order approving 69 new Rules of Professional Conduct, which will go into effect for California attorneys on Nov. 1, 2018. The current rules remain in effect until then.

The court approved 27 amended rules as a state bar committee submitted them. Justices modified and authorized 42 more. And they rejected entirely one proposed rule on a lawyer’s obligations to clients “with diminished capacity”

The California Rules of Professional Conduct are intended to regulate professional conduct of attorneys licensed by the State Bar through discipline. They have been adopted by the Board of Trustees and approved by the California Supreme Court pursuant to statute to protect the public and to promote respect and confidence in the legal profession. The rules and any related standards adopted by the Board are binding on all members of the State Bar.

The new rules are the first comprehensive changes to the rulebook in 29 years. The ethical roadmap for California’s 250,000 attorneys covers 112 pages. It was approved by all seven justices. Here are five things lawyers should know about the new rules according to the summary on law.com.

➤➤ Conflict of interest rules are broader and less case-specific. For example, a new definition of what constitutes a legal “matter” covered by conflict disclosure and non-representation requirements is more expansive now. The changes are much more conforming and much more inclusive of how lawyers nationally understand conflicts of interest.

➤➤ Prohibitions on harassment, discrimination and retaliation by lawyers, both in the workplace and in the practice of law, have been expanded. The rule, the subject of intense debate during drafting, requires “all law firm lawyers the responsibility to advocate corrective action to address known harassing or discriminatory conduct by the firm or any of its lawyers or nonlawyer personnel.”

The state bar can now open an investigation into alleged harassment or discrimination without a triggering civil finding by another agency. Lawyers who receive a related disciplinary charge from the bar will be required to notify state and federal workplace-fairness agencies. One observer said “It’s frankly as broad as about any rule in the country.”

➤➤ The rules don’t specifically mention lawyers serving clients in the marijuana industry. The rules-writing committee sent the Supreme Court a proposed rule “Rule 1.2.1” that would allow lawyers to “discuss the legal consequences of any proposed course of conduct with a client” so long as they don’t counsel that client to break the law. Tuft said the high court sent the rule back about a month ago for more work on some accompanying comments but not the language of the rule itself. Tuft said the rule should be applicable to various topics, such as immigration, where federal and state laws conflict.

➤➤ In most cases, lawyers can’t have sexual contact with their clients. This rule has received a lot of public attention. Currently, the rules bar lawyers from having sex with clients if the act is coerced or considered a form of payment for services rendered. The new rule forbids lawyer-client sex unless there was a previous consensual relationship.

➤➤ The court nixed a rule laying out a lawyer’s responsibilities in representing clients with “diminished capacities.” The justices did not explain the deletion, although they may have decided language dealing with client confidentiality and privacy may have stepped too far into the Legislature’s purview. The California Lawyers Association’s trusts and estates section had sought more clarity in the rules for attorneys practicing in this field.

Attorneys have about six months to become familiar with the rest of the 69 new rules. Ethics is a mandated continuing education topic, and this MCLE cycle will no doubt cover these new rules.

The Division of Workers’ Compensation has suspended three more medical providers from participating in California’s workers’ compensation system, bringing the total number of providers suspended to 245.

The most well know on the new list is Ronald Grusd MD who was convicted in federal court in 2017 for his involvement in a complex illegal referral scheme with suspended providers Steven Rigler, Carlos Arguello, Fermin Iglesias and Alexander Kiev Martinez to defraud the California workers’ compensation system by recruiting patients, paying illegal referral fees, and fraudulently submitting misleading documentation to insurers.

Beverly Hills Radiologist Ronald Grusd and two of his corporations, California Imaging Network Medical Group and Willows Consulting Company, were convicted by a federal jury of fraud and bribery charges in connection with a massive health care-fraud scheme.

After a seven-day trial, the jury found Grusd and his companies guilty on all charges facing them, including Conspiracy, Honest Services Mail and Wire Fraud, Health Care Fraud, and Travel Act violations, based on their years-long bribery and fraud scheme.

According to evidence presented at trial, Dr. Grusd and his companies paid kickbacks for patient referrals from multiple clinics in San Diego and Imperial counties in order to fraudulently bill insurance companies over $25 million for medical services. Dr. Grusd negotiated with various individuals, including a primary treating physician, the payment of kickbacks for the referral of workers’ compensation patients for various medical services, including MRIs, ultrasounds, Shockwave treatments, toxicology testing and prescription pain medications.

After the patients were referred for the treatment or service, one of Dr. Grusd’s companies, California Imaging Network Medical Group, would fraudulently bill insurance companies for the procedures, concealing from both the patients and the insurers that substantial kickbacks had been paid in violation of California law. Another of Dr. Grusd’s companies, Willows Consulting Company, funneled the kickback payments to those directing the referral of the patients from the various clinics. Records presented at trial showed that Dr. Grusd paid over one hundred thousand dollars in bribes to secure the billings for hundreds of patients, with bribes paid on a per-patient or per-body-part formula.

Grusd and the corporations were originally indicted by a federal grand jury in November 2015, when the U.S. Attorney’s Office and the San Diego District Attorney’s Office, working in conjunction with the Federal Bureau of Investigation and the California Department of Insurance, announced multiple arrests arising from “Operation Back Lash” – a long-term, proactive health care fraud investigation targeting corruption and fraud in the California Workers’ Compensation system that is continuing.

Grusd’s practice, California Imaging Network Medical Group, operated clinics throughout California in San Diego, Los Angeles, Beverly Hills, Fresno, Rialto, Santa Ana, Studio City, Bakersfield, Calexico, East Los Angeles, Lancaster, Victorville and Visalia.

Also on the new suspension list is Toros Yeranosian of Encino, co-owner of Mauran Ambulance Service, and Aharon Krkasharyan of Los Angeles, manager of Mauran, were convicted in federal court in 2017 of conspiracy to commit healthcare fraud for their involvement in an illegal scheme of providing unnecessary ambulance transportation services to Medicare beneficiaries and creating fraudulent reasons that justified the services. Yeranosian, Krkasharyan and their co-conspirators submitted over $1 million in false and fraudulent claims to Medicare.

The Ventura County District Attorney’s Office reports that a Santa Paula man pleaded guilty to defrauding Pacific Compensation Insurance, his employer’s workers’ compensation carrier.

Jose Alvizo-Rodriguez (DOB 6/2/71) pled guilty to one count of violating Insurance Code section 1871.4(a), felony workers’ compensation insurance fraud.

Alvizo-Rodriguez was employed at Daley Landscaping in Ojai. On July 2, 2016, he reported an on-the-job injury to his employer.

He was sent to a doctor who placed him off work on temporary total disability (TTD). Daley Landscaping’s insurer, Pacific Compensation Insurance, was required to pay Alvizo-Rodriguez two-thirds of his salary while he was off work receiving medical treatment for his injury.

In August 2016, Alvizo-Rodriguez began working for Coastal Farm Labor Service in Oxnard.

He never told his new employer he was on TTD. In addition, he failed to report to Daley Landscaping and Pacific Compensation that he was back at work full time earning income.

Each TTD check he received contained a warning in both Spanish and English directing him to report any income, and that failure to do so could result in criminal prosecution.

Alvizo-Rodriguez will be sentenced on July 19, 2018, at 9:00 a.m., in courtroom 12 of the Ventura Superior Court, County of Ventura. He faces a maximum sentence of up to five years in jail and a fine of $150,000.

This case was the result of an investigation by the District Attorney’s Bureau of Investigation.

Last February Anthem Blue Cross sent a letter to Sonoma West Medical Center and Palm Drive Healthcare District, demanding repayment and threatening legal action. According to Anthem, the hospital “appears to have conspired with several third parties to fabricate or misrepresent claims for toxicology testing services that were improperly billed to Anthem.”

According to Anthem, the fraudulent billing began after the hospital partnered with Durall Capital Holdings, a Florida company, and Durall’s testing laboratory, Reliance Laboratory Testing. In exchange for more than $2 million, the cash-strapped hospital agreed to conduct toxicology testing for Durall.

Sonoma West denied that they did anything wrong. However they discontinued the practice nonetheless. The Palm Drive Health Care District is now seeking bids for the purchase of its Sebastopol hospital, a move brought on by ongoing financial struggles and debt,. Alanna Brogan, executive director of the district, said the need to sell the hospital became clear after the hospital’s lucrative but controversial lab services were suspended.

The Sonoma West story may be just the tip of a large iceberg of fraud rings that infect rural hospitals.

In March, CBS News investigated questionable billing at rural hospitals in Georgia and Florida. It found that some rural hospitals have become hugely profitable because insurance providers reimburse them at much higher rates. These out-of-the-way hospitals have become gold mines for enterprising health care executives looking for a way to quietly make a quick buck.

Records showed the money was being paid out for drug screens – toxicology tests on urine samples collected from all over the country. Some of the testing was conducted at Durall’s lab, Reliance, in Sunrise, Florida, but everything was billed through Chestatee Regional Hospital, a 49-bed hospital, has been operating for more than 40 years in rural north Georgia. As a rural hospital, it can bill at a higher rate than other facilities.

Documents show Durall’s lab made $67 million billing tests through another rural hospital in Graceville, Florida. A similar deal Durall made with Sonoma West Medical Center in northern California has generated more than $31 million in the last eight months. Last year, Durall bought two more rural hospitals in Georgia and Alabama.

CBS News now reports that in 2016, Missouri state auditor Nicole Galloway began examining the finances of several rural hospitals in her state. One was Putnam County Memorial, a 15-bed hospital in Unionville, Missouri, struggling to keep its doors open.

Her team discovered a management company called Hospital Partners had swooped in weeks before Putnam was about to close, promising to turn it around. They made deals with labs around the country to funnel billing for blood tests and drug screens through Putnam, which collects higher reimbursement rates as a rural hospital. Putnam kept about 15 percent; most of the money was wired back to the labs and the management company.

“Essentially the hospital appeared to act as a shell company for these questionable lab billings,” Galloway explained. “In a six-month period, the hospital funneled through about $92 million in revenues. To put that in perspective, the previous year their total revenues were $7.5 million.”