Category: Daily News

A controversial genetic testing firm under federal investigation for healthcare fraud has been placed into court-ordered receivership – a form of bankruptcy – that could lead to the restructuring and sale of the company. The CEO and founder of Proove Biosciences has also left the company.

Proove Biosciences specializes in DNA testing that the company claims can improve the effectiveness of pain management treatment and determine whether a patient is at risk of opioid addiction.

In June, FBI agents raided the company’s headquarters in Irvine, California. Former and current employees who were interviewed said the agents were focused on possible kickbacks to doctors who encouraged patients to take Proove’s DNA tests. Physicians reportedly could make $144,000 a year in kickbacks that were called “research fees.”

In July, Pain News Network reported that Proove was linked to a Medicare fraud case in which three Indiana healthcare providers allegedly “caused Proove Bioscience” to falsely and fraudulently bill various health care programs for genetic tests administered to Physicians Primary Care patients that were not medically necessary and never interpreted.”

Proove was not named as a defendant in the Indiana case. In an email to PNN, the company CEO said Proove had cooperated with investigators.

The CEO claimed “Proove received written and signed determinations of medical necessity supporting the tests ordered and billed to insurance carriers just like every other laboratory which requires such a determination on a test requisition form. Thus Proove operated appropriately and consistent with usual and customary practices.”

The CEO also defended Proove research, published in the Journal of Addiction Research & Therapy, which claimed to show the effectiveness of its genetic tests.The publisher of the journal, OMICS International, has been accused by the Federal Trade Commission (FTC) of deceiving researchers and readers about the true nature of its publications and peer review process.

“Proove can only speak to its experience with this particular journal,” the CEO said in an email to PNN. “Specifically for papers submitted to this journal, our R&D team and academic collaborators engaged in documented, extensive peer-review, received suggested edits and provided responses to the suggested edits to the manuscripts submitted for review and publication. Thus, Proove would certainly consider the publications accepted from Proove-affiliated authors in that journal to be ‘peer-reviewed’.”

According to the FTC complaint filed last August, OMICS  has created hundreds of “open access” online medical journals that publish articles with little or no peer review. Researchers are also charged significant fees to get their articles published by OMICS, a “pay to play” policy that some consider unethical because it diminishes the quality of academic journals and the peer review process.

Proove has aggressively promoted its genetic tests with healthcare providers around the country. A pain clinic in Montana, for example, had a Proove “patient engagement representative” employed on site at the Benefis Pain Management Center.

Arizona’s attorney general sued Insys Therapeutics Inc this week, accusing the drugmaker of engaging in a fraudulent marketing scheme aimed at increasing sales of a fentanyl-based cancer pain medicine.

According to the report in Reuters Health, the lawsuit by Arizona Attorney General Mark Brnovich in Maricopa County Superior Court in Phoenix comes during a series of federal and state investigations centered on Insys’ Subsys opioid drug.

The lawsuit, filed in Maricopa County Superior Court in Phoenix, accused Insys of paying doctors sham speaker fees in exchange for writing prescriptions of Subsys without regard for the health of patients.

The lawsuit also named three Arizona doctors as defendants who it said collected speaker fees from Insys while writing prescriptions that generated more than $33 million in sales of Subsys, or 64 percent of all sales of the drug in the state.

“We need to put a stop to the unethical and greedy behavior in the pharmaceutical industry that is fueling the opioid crisis in our state,” Brnovich said in a statement.

Insys did not immediately respond to a request for comment. Lawyers for the three doctors – Steve Fanto, Nikesh Seth and Sheldon Gingerich – could not be immediately identified.

The case is the latest to center on Subsys, an under-the-tongue spray intended for cancer patients that contains fentanyl, a highly addictive and regulated synthetic opioid.

In December, federal prosecutors in Boston charged six former Insys executives and managers, including ex-Chief Executive Michael Babich, with engaging in a scheme to bribe doctors to prescribe Subsys.

Federal charges have also been filed in several other states against other ex-Insys employees and medical practitioners who prescribed Subsys.

Two former Insys Therapeutics Inc sales representatives including the wife of its ex-chief executive pleaded guilty in July 2017 to engaging in schemes to pay kickbacks to medical practitioners to prescribe a drug containing the opioid fentanyl.

Natalie Levine, who worked at the Arizona-based drugmaker from 2013 to 2014, plead guilty in federal court in Hartford, Connecticut, to conspiring to violate a federal anti-kickback statute, prosecutors said.

Karen Hill, a sales representative who became the company’s district manager for the Miami region, pleaded guilty in federal court in Mobile, Alabama to conspiring to violate the same anti-kickback law, court records show.

Insys has said it is in talks with the U.S. Justice Department to resolve the federal probe.

The Arizona-based drugmaker previously agreed to pay a combined $8.95 million to resolve investigations by attorneys general in Oregon, New Hampshire and Illinois.

Most of the events that led to sustained prescription opioid use were not hospital events and associated procedures, but diagnoses that were either nonspecific or associated with spinal or other conditions for which opioid administration is not considered standard of care, according to a study published by JAMA Surgery.

The initial event associated with exposure to prescription opioids has not been widely explored, but is often maintained to stem from an injury or surgical procedure.

Andrew J. Schoenfeld, M.D., M.Sc., of Brigham and Women’s Hospital, Harvard Medical School, Boston, and colleagues evaluated the medical diagnoses linked with an opioid prescription that resulted in sustained opioid use in Americans insured through TRICARE, the insurance plan of the U.S. Department of Defense that provides health care coverage for over 9 million beneficiaries. This population may be comparable to the proportion of the general public at greatest risk of sustained opioid use.

The researchers identified 117,118 patients (opioid naïve, i.e., no use of prescription opioids for six months before receipt of a new prescription) who met the criteria for sustained prescription opioid use. Only 800 individuals (0.7 percent) received their initial opioid prescription following an inpatient encounter, with 0.4 percent having undergone an inpatient procedure.

The most common diagnosis associated with the initial opioid prescription for the entire group was other ill-defined conditions (30.6 percent). The most frequent diagnosis among patients treated in military facilities was lumbago. Spinal conditions were among the most frequent diagnoses in both civilian and military settings.

Among specific categories of conditions associated with the initial opioid prescription, spine and orthopedic disorders were the most prominent.

Limitations of the study include its retrospective design and reliance on insurance claims.

“Improved adherence to best practices in opioid prescribing and requirements for better documentation of the rationale for such prescriptions may reduce the risk of sustained use,” the authors write.

This suggestion seems like good advice for claims administrators as they review any Request for Authorization for an opioid medication.

Keenan HealthCare and actuarial consultant Milliman released the 2017 results of their California Hospital Workers’ Compensation and Payroll Benchmarking Survey.

The survey from 18 hospital systems and more than 44 individual facilities within California shows average losses paid per indemnity claim rose 2.9 percent annually over the past 10 years. Data for the survey was collected in the 2nd half of 2016 and early part of 2017 from past participants and entities that expressed an interest in participating.

The survey provides data on more than 4,300 annual claims. The survey analysis also relied on payroll and medical utilization information obtained from the California Office of Statewide Health Planning and Development website.

While the landscape of providing healthcare in the United States is seemingly in flux, “the workers’ compensation environment in California has been surprisingly stable over the last several years.” Despite this stability, workers’ compensation remains one of the most complex exposures for employers who must continue to look for ways to protect employees from injury and improve loss prevention programs.

The survey identified the following workers’ comp trends in the hospital sector:

– Projected loss cost for accidents occurring during 2016 and 2017 were at $2.10 per $100 of payroll. The decrease as compared to prior projections is largely driven by less than expected development in claim severity, while overall claim frequency has largely remained stable.
– Average losses paid per indemnity claim rose 2.9 percent annually over the past 10 years.
– Medical loss trends abated in recent years. Indemnity loss trends are less than long-term averages. Combined, these have resulted in a lower annual rate of severity increase as compared to prior versions of this study.
– However, annual allocated loss adjustment expenses increased significantly during this time period, representing an increasing share of the total cost of claims.

“Looking forward, we expect longer term trend rates closer to 5 percent or 6 percent to prevail, with stronger medical and indemnity loss trends than the recent past, and ALAE trends remaining high,” Bill Poland, marketing director of property/casualty for Keenan, said in a statement. “We believe these key indicators will be valuable in developing plans to modify or adjust programs where necessary with the goal of improving results.”

Ravinderjit Singh was employed as a physician with the California Department of Corrections and Rehabilitation (CDCR) at North Kern State Prison in Delano, California, when she claimed to have suffered a January 8, 2013, industrial injury to her psyche following a fire marshal order to close examination room doors while examining inmates.

Qualified Medical Evaluator (QME) John M. Stalberg, M.D., issued five medical reports regarding Dr. Sing. Following a workers’ compensation hearing a WCJ found, that the injury did not cause permanent disability and that based on Dr. Stalberg’s reporting, Singh “failed to meet the burden of showing entitlement to any period of temporary total disability.

Singh petitioned the WCAB for reconsideration, contending primarily that she was entitled to temporary disability. The WCAB issued its own decision finding Dr. Stalberg’s medical reporting lacking and that Singh “failed to follow-up with Dr. Stalberg and provide the requisite information for him to determine the period she was temporarily totally disabled.” The WCAB accordingly agreed with the WCJ and denied reconsideration.

Singh petitioned the court of appeal for a writ of review, and presented her case for entitlement to temporary disability payments. Singh notes that Dr. Stalberg opined she could return to work inside the prison with the reasonable accommodation of either leaving the examination room open or having a chaperone during examinations, but that the prison refused to accommodate her work restriction.

The WCAB filed a letter brief with the court of appeal stating that it “would admit error in this case and request that the Opinion and Order Denying Petition for Reconsideration issued on March 6, 2017, be annulled and that this matter be returned to the Board for further proceedings.”

The WCAB explains that while it focused its analysis on whether Singh proved temporary disability, she correctly pointed out in her petition for writ of review that “where an employer fails to provide modified work to an injured employee, temporary partial disability is deemed total. (Huston v. Workers’ Comp. Appeals Bd. (1979) 95 Cal.App.3d 856, 868.)” The WCAB explained that the record appeared incomplete, that it may have improperly analyzed Singh’s claim of temporary total disability, and expressed its desire to return the matter to the WCJ for further proceedings.

In response to this court’s inquiry as to whether this court should grant peremptory relief in light of the WCAB’s letter brief, the CDCR contends the matter should not be remanded because “[i]t is well established that an appellant cannot complain about an error that he or she created.” The CDCR asserts any lack of an adequate record is invited error of Singh’s own making by not further developing the record. (Mesecher v. County of San Diego (1992) 9 Cal.App.4th 1677, 1685.)

The court granted the WCAB request in the unpublished case of Sing v WCAB, and the California Department of Corrections and Rehabilitation, “Given the WCAB’s admission it did not consider all available legal theories that might have entitled Singh to benefits, we conclude the WCAB’s decision fails to “state the evidence relied upon and specify in detail the reasons for the decision” as required under section 5908.5. The WCAB’s failure to set forth its reasoning in adequate detail constitutes a sufficient basis to annul the decision and remand for a statement of reasons.”