Category: Daily News

David Williams, a personal trainer, spent years posing as a doctor and billing the nation’s top insurers, making off with millions of dollars.

Williams called himself “Dr. Dave” because he had a Ph.D. in kinesiology. But he didn’t have a medical license. Yet he wrongfully obtained, with breathtaking ease, federal identification numbers that allowed him to fraudulently bill insurers as a physician for services to about 1,000 people.

Getting one through the federal government’s Medicare program is a rite of passage for medical professionals and organizations. Without it, they can’t bill insurers for their services.

Williams discovered and exploited an astonishing loophole: Medicare doesn’t check NPI applications for accuracy. Instead, as one federal prosecutor later noted in court, Medicare “relies on the honesty of applicants.”

Williams first applied for an NPI under his own name as far back as 2008. But it wasn’t until 2014 that Williams began to ramp up his scheme, even though now he wasn’t just unlicensed, he was a two-time felon.

He got a second NPI under the company name, Kinesiology Specialists. The following year, he picked up another under Mansfield Therapy Associates. In 2016, he obtained at least 11 more, often for entities he created in the areas where he found fitness clients: Dallas, Nevada, North Texas and more. By 2017, he had 20 NPIs, each allowing him a new stream of billings.

For every NPI application, Williams also obtained a new employer identification number, which is used for tax purposes. But he never hid who he was, using his real name, address, phone number and email address on the applications. He added the title “Dr.” and listed his credentials as “PhD.” Under medical specialty he often indicated he was a “sports medicine” doctor and provided a license number, even though he wasn’t a physician and didn’t have a medical license.

“Now accepting most health insurance plans,” his Get Fit With Dave website announced. He added a drop-down menu to his site, allowing potential clients to select their health insurance provider: Aetna. Blue Cross Blue Shield. United.

He began building a team, soliciting trainers from the strength and conditioning department at Texas Christian University. He met with new recruits at local fast food joints or coffee shops to set them up. To the trainers, the business appeared legit: They even signed tax forms. Before long, Williams’ network stretched throughout Texas and into Colorado, Idaho and Nevada.

He used his favorite billing code – 99215. The code is supposed to be used less often because it requires a comprehensive examination and sophisticated medical decision-making, warranting higher reimbursement. In all, Williams used the code to bill United for more than $20.5 million – without apparently triggering any red flags at the insurer. For that code alone, the insurance giant rewarded him with $2.5 million in payments.

He ran the scheme for more than four years, fraudulently billing several of the nation’s top insurance companies – United, Aetna and Cigna – for $25 million and reaping about $4 million in cash.

A case summary, prepared by the Texas Department of Insurance, shows it first learned of the Williams case in January 2015 but lacked staff to investigate.

Cigna appears to have been the quickest to intervene. In January 2015, Cigna sent Williams a letter, noting that he wasn’t a licensed medical provider and had misrepresented the services he provided. The insurer said he needed to pay back $175,528 and would not be allowed to continue billing.

Williams had more than one National Provider Identifier, so he just switched numbers and kept billing Cigna. More than a year later, in May 2016, Cigna sent another letter, saying he now owed $310,309 for inappropriate payments. In total, the company paid him more than $323,000. Williams never gave any of it back.

In October 2017, Williams’ long run came to an end when he was arrested by the FBI. After a two day trial, a jury convicted Williams of four counts of health care fraud. He was sentenced him to a little more than nine years in federal prison and ordered him to pay $3.9 million in restitution to United, Aetna and Cigna.

The head of the U.S. House of Representative’s oversight panel on Wednesday called on three drugmakers to turn over documents as part of an ongoing congressional review over generic drug price increases and accused the companies of “apparent efforts to stonewall” the probe.

U.S. House Oversight Chairman Elijah Cummings, along with U.S. Senator Bernie Sanders, the ranking member on the Senate Budget Committee, sent the letters to Mylan NV (MYL.O), Teva Pharmaceutical Industries Ltd (TEVA.TA) and privately held Heritage Pharmaceuticals, the lawmakers said in a statement.

Mylan’s shares fell 6.8% to $18.37, while Teva slumped 6.2% to $6.61 on Wednesday morning.

“Teva continues to cooperate fully with all investigations,” a spokeswoman for the company said. Mylan did not respond to Reuters request for comment.

The lawmakers first launched the probe in 2014. Earlier this year, 44 U.S. states filed a complaint in federal court alleging drug price fixing by the three pharmaceutical companies and other drugmakers, according to the statement.

Now Cummings and Sanders said they were “opening an investigation into the companies’ apparent coordinated obstruction of the investigation as revealed by,” the states’ lawsuit.

“Not only did your company’s apparent obstruction undermine our investigation, but it may have caused further harm to patients and health care providers by delaying the discovery of evidence about the companies’ price-fixing,” Cummings and Sanders wrote.

Sanders, who is among those seeking the Democratic presidential nomination for the 2020 election, has made health care and drug prices a cornerstone of his campaign.

Paul Ronald Payne (DOB 6/21/1968), of Simi Valley, was sentenced to 365 days in the Ventura County jail and ordered to pay $1,058,058 in restitution to the State Compensation Insurance Fund for underreporting payroll and failing to pay workers’ compensation insurance premiums.

Payne operated a roofing and painting business called Paul Payne Roofing. The business involved hiring and maintaining a crew of employees to work roofing and painting jobs.

Between 2012 and 2016, Payne submitted payroll reports to the State Compensation Insurance Fund indicating that he did not have any employees and thus paid only a fraction of the workers’ compensation premiums he owed.

One of Payne’s employees reported a traumatic injury in 2016, alerting the insurer that Payne was operating his business without reporting his true payroll.

In addition to his jail sentence, Payne was placed on six years of formal probation and paid $25,000 toward restitution prior to sentencing. He was ordered to continue making monthly restitution payments.

Workers’ compensation insurance fraud is not a victimless crime. It harms local businesses that pay for workers’ compensation insurance because their costs and prices are higher than those of uninsured and underinsured businesses. Uninsured and under-insured employers also risk the safety of their workers by failing to provide them with adequate protection from on-the-job injuries.

The Ventura County District Attorney’s Office takes a vigorous stance against workers’ compensation insurance fraud and works with local and state agencies to prosecute such fraud.

The Canadian government announced final regulations on Friday that should cut billions of dollars from patented drug prices that are among the highest in the world, overcoming heavy opposition from pharmaceutical companies who may eventually challenge the new rules in court.

The biggest reform to Canada’s drug price regime since 1987 would save Canadians C$13.2 billion ($10 billion) over a decade. The rules will save money for patients, employers and insurers including the government at the expense of drug company profits. They also could eventually cut the earnings of drugmakers in the United States, the world’s largest pharmaceutical market.

Minister of Health Ginette Petitpas Taylor said the new rules would lay the foundation for a new national drug program. Prime Minister Justin Trudeau’s government is expected to announce a program to cover the cost of prescription drugs for some or all Canadians, but the program’s scope is not yet clear.

Canada’s approach to drug pricing is unusual. Rather than bargaining prices down, the PMPRB declares that some prices are an illegal abuse of patent rights.

Drugmakers base their list prices on the agency’s published guidelines. When there is disagreement, PMPRB staff can challenge drugmakers at an internal tribunal. Most cases are settled, but appeals go to federal court and beyond.

In the past, drug companies have gone as far as the Supreme Court of Canada to challenge PMPRB guidelines. With new regulations come new guidelines, and the potential for fresh court challenges.

“We anticipate a considerable uptick in litigation, at least initially, as the industry patentees test the boundaries of the new regime,” said Douglas Clark, executive director of the PMPRB, on a call with reporters. “That’s to be expected any time you substantially change rules.”

Global drugmakers, including Johnson & Johnson , Merck & Co and Amgen Inc , argued against the draft plan.

While the government’s focus is on reducing domestic patented drug prices that are among the highest in the world, the new policy could eventually have consequences south of the border.

The Trump administration in July said it would allow U.S. states and other groups to start pilot programs related to importing drugs from Canada. It has also said it may start determining what the U.S. government healthcare program Medicare pays for certain medicines based on prices in some other countries, including Canada.

Reuters reported in February that pharmaceutical lobby groups had tried to head off the Canadian reforms with an offer to give up C$8.6 billion in revenue over 10 years, freeze prices or reduce the cost of treating rare diseases. Drugmakers argue the reforms could limit Canadians’ access to new medicines.

The government said many countries with lower prices have more pharmaceutical industry investment and access to drugs that meets or exceeds Canada’s.

An ex-physician pleaded guilty to federal criminal charges for illegally prescribing and distributing the semi-synthetic opioid painkiller oxycodone to undercover operatives who visited the physician’s Victorville medical office.

Wendell Mark Street, 67, of Las Vegas, pleaded guilty to two felony counts of illegally prescribing oxycodone to patients without a legitimate medical purpose. United States District Judge George H. Wu has scheduled a December 9 sentencing hearing, at which time Street will face a statutory maximum sentence of 40 years in federal prison.

Street admitted in court that, while he was a licensed anesthesiologist, on August 1, 2013, he sold two prescriptions for $300 each to a confidential informant and Ray Ephraim, an undercover investigator with the California Medical Board. He further admitted that he wrote the prescriptions without a legitimate medical purpose and intentionally acted outside the usual course of professional practice, including by failing to conduct a physical examination, establish diagnostic testing, provide a treatment plan, and create documentation to establish a medication indication for the prescriptions.

The investigation showed that Street prescribed 7,769 prescriptions for narcotics, including 437,000 doses of oxycodone, from November 2012 to November 2013.

Street was charged in a 10-count indictment returned by a federal grand jury in February 2018. During the investigation into Street, investigators executed a search warrant at his Victorville office in 2014. Street surrendered his California medical license in 2016.

This matter was investigated by the Drug Enforcement Administration – Riverside District Office Diversion Group.

This case is being prosecuted by Assistant United States Attorneys Bryant Y. Yang of the International Narcotics, Money Laundering, and Racketeering Section and Jason C. Pang of the General Crimes Section.