Author: WorkCompAcademy

The California Attorney General announced the sentencing of a Southern California doctor for an illegal prescription scheme that defrauded the state Medi-Cal program of over $20 million.

Mohammed El-Nachef, M.D., was sentenced to five years in jail after entering a plea of guilty for prescribing medically unnecessary HIV medications, anti-psychotics, and opioids to over a thousand Medi-Cal beneficiaries in Los Angeles and Orange Counties.

As part of his sentence, El-Nachef also paid $2.3 million in restitution and surrendered his medical license. The prosecution in this case was carried out by the California Department of Justice’s Division of Medical Fraud and Elder Abuse (DMFEA).

El-Nachef served as the prescriber at two clinics – one in Anaheim and the other in Los Angeles – and carried out the prescription scheme from June 2014 to April 2016.

In exchange for cash payments, he prescribed expensive medications to Medi-Cal beneficiaries who had no medical need for them. The medications were not kept or used by the beneficiaries, but were instead diverted to the illicit market for cash.

He was accused of helping “two convicted felons, Steve Fleming and Oscar Abrons, in a scheme to obtain expensive pharmaceuticals that were sold on the illicit market,” according to court papers filed by the state Attorney General’s Office.

In September 2022, El-Nachef pled guilty in the Orange County Superior Court to one count of insurance fraud and one count of aiding and abetting the unauthorized practice of medicine.

He will serve his five-year sentence split, with two years in the Orange County Jail and three years on mandatory supervision.

DMFEA protects Californians by investigating and prosecuting those who defraud the Medi-Cal program as well as those who commit elder abuse. These settlements are made possible only through the coordination and collaboration of governmental agencies, as well as the critical help from whistleblowers who report incidences of abuse or Medi-Cal fraud at oag.ca.gov/dmfea/reporting

For over 20 years Liberty Mutual has published the Workplace Safety Index (WSI). Liberty Mutual’s WSI estimates the top ten causes of the most serious workplace injuries – those causing an employee to miss more than five days of work – and ranks them by their direct costs of medical and lost-wage payments.

The 2023 Liberty Mutual Workplace Safety Index (WSI) is based on information from Liberty Mutual, customized data from the U.S. Bureau of Labor Statistics Office of Safety, Health, and Working Conditions, and the National Academy of Social Insurance (NASI).

U.S. industries spent $58.61 billion on the direct costs of worker injuries, and 82.2 percent of that cost ($48.15B) was for the top 10 causes of disabling injuries and illnesses. The 10 most costly causes of workplace injuries and illnesses are:

1) Overexertion involving outside sources – – Cost per year: $12.84B
2) Falls on same level – – Cost per year: $8.98B  
3) Falls to lower level – – Cost per year: $6.09B
4) Struck by object or equipment – – Cost per year: $5.14B
5) Other exertions or bodily reactions – – Cost per year: $3.67B
6) Exposure to other harmful substances – – Cost per year: $3.35B
7) Roadway incidents involving motorized land vehicles – – Cost per year: $2.58B
8) Caught in or compressed by equipment or objects – – Cost per year: $1.98B
9) Slip or trip without fall – – Cost per year: $1.92B
10) Pedestrian vehicular incidents – – Cost per year: $1.61B

One notable change is the presence of pedestrian vehicular incidents for the first time in the Index’s top 10. In addition to being a high-severity cause of loss, the BLS reported the highest number of these injuries in the previous 10 years, coupled with lower injury counts for most other causes of loss.

Compared to last year’s WSI, total estimated industry cost reduced the most for Leisure & Hospitality (-16.8%; consistent with the economic contraction caused by COVID-19 in this sector), whereas Professional & Business Services and Healthcare & Social Assistance experienced an increase in total cost of 6.2% and 4.3%, respectively.

Blue Shield of California announced a new pharmacy care model that is designed to fix problems in what it calls “today’s broken prescription drug system.” The nonprofit health plan is transforming how medications are purchased and supplied to its 4.8 million members by selecting organizations that share Blue Shield’s vision for more affordable and transparent pharmacy services.

Today’s announcement is a major milestone in Blue Shield’s Pharmacy Care Reimagined initiative, which will help provide its members with convenient, transparent access to medications while lowering costs. Once Blue Shield’s multi-year strategy is fully implemented, the health plan expects to save up to $500 million in annual drug costs.

Most American adults take at least one prescription drug annually, with more than a third of adults taking at least three medications per year. Already a significant cost, total prescription drug spend in the United States is consistently rising. In 2021, the American healthcare system spent more than $600 billion on prescription drugs – about $1,500 per person, per year.

The current pharmacy care system rewards some stakeholders for selling more drugs at higher costs. Blue Shield is seeking to transform the system into a value-based model that provides members with the medications they need at a more affordable cost.

“The current pharmacy system is extremely expensive, enormously complex, completely opaque, and designed to maximize the profit of participants instead of the quality, convenience and cost-effectiveness for consumers,” said Paul Markovich, president and CEO of Blue Shield of California. “That is why we are working with like-minded partners to create a completely new, more transparent system that gets the right drugs to the right people at the right time at a substantially lower cost.”

In today’s current pharmacy supply chain, there can be up to a dozen companies involved in the process from when a drug is made to when a member receives it. Some can add complexity and cost without adding value or providing transparency into the rationale for their pricing. To simplify the system and cut unnecessary costs, Blue Shield has selected five companies with like-minded philosophical and technology standards to build a new, innovative model following regulatory approval. Together, Blue Shield will offer an integrated, coordinated, and holistic pharmacy experience to its members.

– – Amazon Pharmacy will provide fast and free delivery of prescription medications, complete with status updates, as well as upfront pricing and 24/7 access to pharmacists.
– – Mark Cuban Cost Plus Drug Company will establish a simple, transparent, and more affordable pricing model, reducing surprise drug costs at the pharmacy pick-up counter.
– – Abarca will pay prescription drug claims quickly and accurately while continuing to evolve its technology platform, Darwin, to support new, simplified payment models.
– – Prime Therapeutics will work with Blue Shield to negotiate savings with drug manufacturers to move toward a value-based model that aligns drug prices to patient efficacy and health outcomes.
– – CVS Caremark will provide specialty pharmacy services for members with complex conditions, including education and high-touch patient support.

“Amazon Pharmacy is thrilled to join Blue Shield of California in their effort to help members get the medications they need, when they need them, at a price they can afford,” said John Love, vice president of Amazon Pharmacy. “With the help of Amazon’s upfront pricing, on-time delivery, and round-the-clock access to clinical care, we can provide a customer-centric pharmacy experience that supports better health outcomes.”

“Our company was built on a commitment to deliver transparent and affordable prescription drugs to everyone, and we are excited to collaborate with Blue Shield of California to change this part of the healthcare system in such an impactful and meaningful way,” said Alex Oshmyansky, founder and CEO of Mark Cuban Cost Plus Drug Company. “We hope others will follow in the effort to fix this convoluted and inefficient prescription drug supply chain.”

Juan Lopez claimed injury to his cervical, thoracic, and lumbar spine, to his shoulders and arms, to his heart and lungs, and in the form of hypertension, HIV, and GERD , while employed by Barrett Business Services as a laborer during the period from December 23, 2009, through December 23, 2010 (ADJ7745966). He also claimed injury to his heart and blood system, and in the form of HIV and GERD while employed by the same Barrett on September 13, 2010 (ADJ7909061).

By December 2014, the case had already been remanded by the Board on the issue of AOE/COE and assigned to a new WCJ after the prior WCJ had retired. The on-going litigation of this matter from December 2014 to the present included a number of additional times when the matter was continued or ordered off calendar for development of the record. The the case was submitted and the new WCJ issued an Opinion, and a Petition for Reconsideration was denied.

At an MSC in September 2016 the defendant asked that the case be set for trial on all issues, and applicant asked for a continuance, which was granted, and at the next MSC in November 2016 defendant asked that discovery be closed and the case set for trial, but the WCJ to the matter off calendar for a PQME appointment.

After a DOR was filed, a trial scheduled for February 6, 2018, but the applicant did not appear, and the case was continued. On April 24, 2018, the parties appeared, the matter was pending submission to allow post-trial briefs and submitted on May 14, 2018.

On June 15, 2018, the WCJ vacated submission in part because the internal PQME deferred to an expert in infectious disease. At the second status conference after the submission was vacated the court issued an order for a panel qualified medical examiner in Infectious Disease. On February 7, 2019, the parties appeared for a status conference and no PQME panel had been issued because applicant’s hearing representative “guessed” his office did not send the paperwork. The court continued the status conference.

At the next status conference on May 2, 2019, the parties agreed to submit on the existing record. but the WCJ found that the record needed further development, At a continued MSC on August 19, 2021, the parties supplemented the existing record with the report of Dr. Vyas and the matter was submitted. On October 6, 2021, the court realizing the report submitted was not the internal medicine report the court had been waiting for and vacated the submission.

Finally on May 10, 2023, the matter was tried and submitted. On May 22, 2023, the WCJ issued a Finding and Award which found applicant failed to meet his burden to show industrial injury on the disputed body parts.

Applicant filed a Petition for Reconsideration in case number ADJ7745966, where the WCJ found that applicant did not sustain injury AOE/COE to his lungs or in the form of HIV (human immunodeficiency virus). And in case number ADJ7909061wherein the WCJ found that applicant did not sustain injury AOE/COE, to his heart and blood system nor in the form of HIV or GERD. Applicant contends the record should be further developed regarding applicant’s HIV injury claim.

Reconsideration was denied in the panel decision of Lopez v Barrett Business Services -ADJ7909061-ADJ7745966 (August 2023).

The WCJ and the Appeals Board have a duty to further develop the record where there is insufficient evidence on an issue. (McClune v. Workers’ Comp. Appeals Bd. (1998) 62 Cal.App.4th 1117, 1121-1122 [63 Cal.Comp.Cases 261]; see also Tyler v. Workers’ Comp. Appeals Bd. (1997) 56 Cal.App.4th 389, 394 [62 Cal.Comp.Cases 924].)

However, if a party fails to meet its burden of proof by obtaining and introducing competent evidence, it is not the job of the Appeals Board to rescue that party by ordering the record to be developed. (Lab. Code, § 5502; San Bernardino Community Hospital v. Workers’ Comp. Appeals Bd. (McKernan) (1999) 74 Cal.App.4th 928 [64 Cal.Comp.Cases 986]; Telles Transport Inc. v. Workers’ Comp. Appeals Bd. (2001) 92 Cal.App.4th 1159 [66 Cal.Comp.Cases 1290].)

The duty to develop the record must be balanced with the parties’ obligation to exercise due diligence to complete necessary discovery. (San Bernardino Community Hosp. v. Workers’ Comp. Appeals Bd. (McKernan), supra.)

“In this case, the parties have submitted the case for decision three times and the WCJ has vacated submission three times.The medical record has not been developed as directed by the WCJ despite ample opportunity to do so.“

“Our review of the entire record (for the period from January 2011, to the present) clearly indicates that applicant was repeatedly given the opportunity to develop the record in support of his injury claims. As noted above, it is not our responsibility to rescue a party by ordering the record to be developed when that party has previously been provided ample opportunity to further develop the record.”

“Thus, applicant has not shown good cause, under the circumstances of this matter, to yet again, delay final resolution of applicant’s injury claims through further development of the record. Therefore, we will not disturb the WCJ’s F&A.”

In 2020, Allstate Insurance Company and several of its affiliates filed two qui tam actions alleging insurance fraud in violation of the California Insurance Frauds Prevention Act (IFPA) (Ins. Code, § 1871 et seq.) and the Unfair Competition Law (UCL) (Bus. & Prof. Code, § 17000 et seq.) against three medical corporations, a medical management company and its parent company, four physicians, and Sattar Mir, an individual.

The first action was filed against Discovery Radiology Physicians, P.C., a professional medical corporation; Mir; and radiologists Drs. Safvi and Feske.

The second action was filed against Mir; OneSource Medical Diagnostics, LLC, a medical management company owned by Mir; 1st Source Capital, LLC, OneSource’s parent company; Safvi Medical Corporation and Expert MRI, P.C., professional medical corporations; and radiologists Drs. Safvi, Mazhar, and Khan.

The complaints alleged that the three medical corporations – Discovery Radiology, Expert MRI, and Safvi Medical – were formed and controlled by Mir, who is not a physician, to broker radiology services. The medical corporations solicited patients, referred the patients to MRI facilities and radiologists with whom Mir had contracted, and then billed Allstate for the MRIs. The bills represented that the MRIs had been performed by the defendant medical corporations, but the MRIs actually were performed at MRI facilities whose identities were not disclosed, and were read by radiologists under contract with the medical corporations. The resulting bills falsely identified the technical and professional services as having been provided by one of the three defendant medical corporations and grossly inflated the fees for the services provided.

Demurrers were filed to amended complaints by the defendants in both actions. The trial court sustained the demurrers without leave to amend. It found, first, that Allstate did not comply with the court’s prior order because it did not identify the dates of each allegedly false bill, the persons or entities who prepared the bills, the persons or entities who transmitted the bills to Allstate, or which defendants made each alleged false statement. Second, the court found the complaints “woefully lacking in the required specificity.”

The trial court also said it was insufficient for Allstate to “invoke the mantra of ‘structural fraud.’ Importantly, Allstate makes no claim here that: (1) MRIs were not administered; (2) MRIs were not medically necessary; or (3) qualified radiologists did not read the MRIs. . . . [¶] . . . [Instead, Allstate argues] that this case involves the unlawful corporate practice of medicine and that ‘Mir engaged in the unlawful practice of medicine.”

The Court of Appeal reversed in the Published case of P. ex rel. Allstate Ins. Co. v. Discovery Radiology etc. -B315264 (August 2023).

This appeal presents four basic issues: (1) Are the business models alleged in the amended complaints unlawful? (2) If the alleged business models are unlawful, do they give rise to causes of action under the IFPA and the UCL? (3) Do the amended complaints plead fraud with sufficient particularity? (4) Does the Discovery action adequately allege delayed discovery to survive demurrer on statute of limitations grounds?

The answer to each of these questions was “yes.” First, the operative complaints allege the unlicensed practice of medicine in violation of the Medical Practice Act (§ 2000 et seq.) and related statutes. Second, claims submitted to an insurer for medical services rendered in violation of the Medical Practice Act may give rise to causes of action under the IFPA and the UCL. Third, Allstate’s claims are pled with adequate specificity. Finally, as alleged, the claims asserted in the Discovery action are not time-barred as a matter of law.

Defendants asserted , that the business practices alleged in the complaints were lawful because Mir and OneSource allegedly provided only managerial and/or administrative services, not medical care, and thus did not engage in the unlicensed practice of medicine.

The Court of Appeal was not aware of any appellate decisions that have discussed the unlicensed practice of medicine in the specific context of referrals for radiology services. However, the Attorney General has twice opined that selecting a radiology provider involves the practice of medicine. In an opinion issued in 2000, the Attorney General stated that a management services organization may not, for a fee, select, schedule, secure, and pay for radiology diagnostic services ordered by a physician because that would constitute the unlicensed practice of medicine.

Subsequently, in a 2009 opinion the Attorney General “reiterate[d] [its] view that professional radiology services – specifically including the selection of a suitable radiologist, and the selection of a suitable radiology facility with appropriate equipment and personnel, as well as preparing and interpreting radiological images – involve the exercise of professional judgment as part of the practice of medicine.” (92 Ops.Cal.Atty.Gen. 56 (2009).)

“The amended complaints state claims against each defendant for engaging in or assisting in the unlicensed practice of medicine because they allege an unlawful degree of control by non-physicians over the medical corporations’ provision of diagnostic radiology services.”