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Tag: 2017 News

Disgruntled QMEs Sue DWC to Renew Certifications

Former QMEs Dr. Timothy C. Howard, Dr. Meera Jani and Dr. Benjamin Simon have filed a lawsuit in the Los Angeles Superior Court against the California Department of Industrial Relations, its Director Christine Baker and other officials seeking a writ of mandate ordering their reinstatement and reappointment as a QME.

Howard has been licensed as an orthopedist since 1971, and has performed 400 to 500 total knee and hip surgeries, and 200 to 300 spinal surgeries. He was first appointed as a QME in 2005, and has prepared approximately 1,500 QME reports. Jani has been licensed as a chiropractor since 2000, and was first appointed as a QME in 2001. Simon has practiced medicine as a cardiologist for 30 years during which time he has performed thousands of interventional procedures. He has been a QME since 2015 and has prepared approximately 150 QME reports.

Prior to the DWC’s actions described below, none of them claim to have received any billing or other complaints from the DWC.

They allege that in addition to these three plaintiffs, so far approximately 400 QMEs have now “unlawfully” been denied reappointment out of a total DWC panel of only 3,000 QMEs, or approximately 1 3 .3% of all QMEs in California.

The 134 page complaint cites a variety of reasons for issuance of the relief they request. They assert that the DWC has “engaged in a scorched earth policy to deny reappointment licenses to qualified medical evaluators without due process of law – including without a hearing to challenge Respondents’ mere accusations – through Respondents’ imposition of new and different criteria governing such reappointments and the medical-legal fee schedule applicable to QMEs in California.”

The “new policy” they claim is the product of “underground regulations.” They allege that the DIR has “without notice, intentionally adopted underground regulations regarding the medical-legal fee schedule used as prima facie evidence of the reasonable fees paid for QME medical-legal evaluations of injured workers under California’s workers’ compensation system. These underground regulations are being utilized by Respondents to impose new and different criteria that effectively eliminate hourly billing code 104, a goal sought by the workers’ compensation insurers and other payors of the workers’ compensation benefits, which is contrary to the interests of the injured workers that workers’ compensation laws, for over 100 years, are designed to protect.”

Plaintiffs further say that respondents “are required by California law to provide QMEs with a hearing that protects QME rights to due process of law and procedural safeguards, before suspending, terminating or otherwise disciplining a QME for crimes, fraud, and all other violations of law, save for a few specifically enumerated circumstances that are irrelevant herein. However, through its use of underground regulations, Respondents have improperly extended the “no due process hearing” exception to apply specifically to the reappointment process for QMEs, thereby illegally denying reappointment based solely on mere accusations, and thus achieving an end-run around the QMEs’ rights to a due process hearing.”

The three allege they have requested hearings to contest the denial of their reappointment, and that the DIR refuses to allow them any type of hearing to present their case.

Petitioners allege that “a disproportionate number of QMES who have been denied reappointment without a due process hearing based on Respondents’ mere accusations of violations of the medical-legal fee schedule, reside in Los Angeles County.”

FDA Orders 74 Opioid Drugmakers to Train Doctors

The Food and Drug Administration Commissioner said on Thursday that makers of fast-acting opioids will have to fund voluntary training for healthcare professionals who prescribe the drugs, including education on safe prescribing practices and non-opioid alternatives.

FDA Commissioner Scott Gottlieb announced that “This week, we issued letters notifying 74 manufacturers of IR opioid analgesics intended for use in the outpatient setting that their drugs will now be subject to a more stringent set of requirements under a Risk Evaluation and Mitigation Strategy (REMS). The REMS requires that training be made available to health care providers who prescribe IR opioids, including training on safe prescribing practices and consideration of non-opioid alternatives.”

The medications, which include Vicodin and Percocet, often combine oxycodone or hydrocodone with less powerful painkillers like acetaminophen. They account for 90 percent of all opioid painkillers prescribed.

Manufacturers of long-acting opioids such as OxyContin, which release their doses over 12 hours or more, have been subject to the requirements since 2012.

Gottlieb called the immediate-release versions a “potential gateway to addiction” in a blog post Thursday.

Dr. Andrew Kolodny, founder of Physicians for Responsible Opioid Prescribing and an advocate for opioid reform, said the details of the trainings will be important in determining whether they have the potential to make a difference, but said Gottlieb’s choice of words is significant.

“To have the head of the FDA talk about addiction caused by medical treatment really suggests a change in what we hear about opioids,” Kolodny said.

The prescriber training, which could take a year to organize and implement, must include consideration of non-opioid alternatives.

Gottlieb wrote in the blog post that the agency’s new opioid policy steering committee is considering “whether there are circumstances when FDA should require some form of mandatory education for health care professionals, and how the agency would pursue such a goal.”

Feds Accuse Tenet Healthcare of $400 Million Fraud

According to an indictment made public on Wednesday, the U.S. Justice Department has brought new charges over a scheme that it says enabled Tenet Healthcare Corp to fraudulently bill state Medicaid for $400 million.

William Moore, the ex-chief executive of Atlanta Medical Center Inc, which had been operated by Tenet; and Edmundo Cota, the ex-head of a clinic operator that provided prenatal care to Hispanic women, were charged in an indictment filed in Atlanta federal court. They were added as defendants in a case the Justice Department brought in February against John Holland, a former Tenet senior vice president. The trio faces multiple charges including conspiracy and wire fraud, according to the indictment.

The charges came after Dallas-based Tenet and two of its Atlanta-area units in October 2016 reached a deal with the Justice Department and agreed to pay more than $513 million to resolve criminal charges and civil claims in a related case.

Brian McEvoy, a lawyer for Moore at the law firm Polsinelli PC, said in a statement he was “extremely disappointed” with the agency’s action. “Mr. Moore is not guilty and we look forward to presenting this case to a jury at trial,” McEvoy said.

A lawyer for Cota, the former CEO of medical clinic operator Clinica de la Mama, could not be immediately identified. A Justice Department spokesman declined to comment.

The indictment said that from 2000 to 2013, Holland, Moore Cota engaged in a scheme to cause Tenet to pay over $12 million in bribes and other illegal inducements to Clinica, which operated clinics in Georgia and South Carolina. In exchange, the owners and operators of Clinica referred patients to Tenet hospitals and arrange for medical services for Clinica patients related to child birth at the hospitals.

To justify the $12 million, Holland, Moore, Cota and others created pre-textual contracts between Tenet’s hospitals and Clinica, which provided services mostly to undocumented Hispanic women, the indictment said.

In order to steer patients to Tenet hospitals in Georgia and South Carolina, Cota and others blocked doctors from seeing patients at Clinica unless the physicians agreed to deliver their babies at Tenet hospitals, the indictment said.

Prosecutors said the scheme enabled Tenet hospitals to fraudulently bill the Georgia and South Carolina Medicaid programs for over $400 million, and allowed Tenet to receive at least $127 million on those claims.

The case is U.S. v. Holland, et al, U.S. District Court, Northern District of Atlanta, No. 17-cr-234.

DWC Adjusts DMEPOS Section of OMFS

The Division of Workers’ Compensation (DWC) has posted an order adjusting the Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) section of the Official Medical Fee Schedule to conform to the fourth quarter 2017 changes in the Medicare payment system as required by Labor Code section 5307.1.

The order effective for services rendered on or after October 1, 2017 adopts the Medicare DMEPOS Quarter 4, 2017, DME17-D ZIP file.

The 2017 Parenteral and Enteral Nutrition Fee Schedule File from DME17-A (Updated 01/06/17) ZIP file was not updated for the fourth quarter, and remains in effect for services on or after October 1, 2017.

The order adopting the adjustment can be found on the DWC website.

Governor Signs AB 1422 – Lien Fraud Clean Up Bill

Governor Brown signed AB 1422 into law on Tuesday. According to the Governor’s signing memo he said “I am signing AB 1422 which is clean-up legislation to last year’s workers’ compensation anti-fraud bills, AB 1244 and SB 1160. Those measures established new requirements and authority to help prevent and reduce fraud in the workers’ compensation system. Specifically, they require the suspension of medical providers who have been convicted of crimes involving fraud or abuse. They also require placing a stay on any liens filed by providers charged with such crimes (pending disposition of the charges).”

“AB 1422 confirms that the Workers’ Compensation Appeals Board retains jurisdiction to resolve disputes about the applicability of the automatic stay provision to specific liens. This bill is declaratory of existing law which provides for the resolution of these disputes through the Board’s current practices and procedures. Nothing in last year’s legislation creating the stay was intended, or operated, to divest the Board from jurisdiction over these issues.”

The Administrative Director of the Workers’ Compensation System would be authorized to adopt regulations to implement these provisions.

The original fraud law was ambiguous in terms of the status of liens filed by companies who were not themselves part of a criminal prosecution. Under the revised law, the stay provisions will apply not only to a person who is being prosecuted, but to a “controlled entity” as well. An entity is controlled by an individual if the individual is an officer or a director of the entity, or a shareholder with a 10 percent or greater interest in the entity.

In addition, the amendments address some other complications that have arisen. For example, in criminal law, a conviction is not entered until judgment is imposed, which usually means at the time of sentencing. With respect to addressing liens, that time frame does not work in cases where a provider pleads guilty, agrees to cooperate with prosecutors, and delays sentencing for an extended period. Other clarifications, such as the right to refuse to pay a bill of a convicted provider, simply fill in some gaps in the drafting of last year’s bills.

In some respects, the amendments are intended to be more explicit about what the Legislature intended the language in last year’s enactments to mean – and these are designated as declaratory of existing law because it is clear that the new language is precisely what was intended by the Legislature in this bill and SB 1160.

The new law deletes language that terminates the stay on lien proceedings at the end of the criminal proceedings, and specifies that the stay remains in effect until the completion of the special administrative proceedings that apply to liens filed by providers convicted of workers’ compensation fraud.

With respect to the constitutional issue of “due process” over the automatic stay provisions, the new law added the following language to LC 4615 “(e) The automatic stay required by this section shall not preclude the appeals board from inquiring into and determining within a workers’ compensation proceeding whether a lien is stayed pursuant to subdivision (a) or whether a lien claimant is controlled by a physician, practitioner, or provider.”

The next hearing on the motion for preliminary injunction pending in federal court based upon this constitutional issue filed Dr. Eduardo Anguizola, who is facing multiple counts of insurance fraud filed by Orange County prosecutors, is set on this Thursday, September 28, 2017 at 8:30 am in courtroom 9D in downtown Los Angeles. AB 1422  should provide federal Judge Wu with ample authority to deny the request for an injunction now that there is clear language affording stayed lien claimants with “due process” of law.

Going and Coming Rule Precludes Employer Tort Liability

In 2012, Mr. Ong’s vehicle collided with a vehicle driven by Louis Deandre Gonzalez, Jr. A passenger in the Gonzalez vehicle, Marisol Morales, was killed in the collision.

Ong told the officer who investigated the accident that he was driving to his employer, Genentech in South San Francisco on his night off to collect resumes for “some upcoming interviews he had.” Ong said that he worked the night shift at Genentech. A few hours before the accident, Ong told his friend Dan Alvarez that he was going to Genentech to do something important for work.

Ong resided in Hayward, California and commuted to Genentech in his own vehicle. Genentech never owned, leased, or possessed Ong’s 1999 Range Rover or Land Rover, the vehicle he was driving at the time of the accident. Genentech did not require Ong to drive or own a vehicle, and did not compensate Ong for travel time or expenses.

During his deposition, Ong gave various reasons for his trip to Genentech that morning. Ong testified that he intended to stop at Genentech to retrieve old resumes he had left in his mailbox and some personal belongings from his locker on his way to visit his grandmother in hospice care in South San Francisco. He also said one purpose of the trip to Genentech was to pick up the resume of his unemployed friend, Dan Alvarez, who had asked Ong if he could recommend Alvarez for a job. Ong’s testimony with respect to Alvarez’s resume was impeached; Alvarez stated he does not have a resume and never gave one to Ong.

Plaintiffs filed a civil complaint in 2013 alleging Ong and Genentech were both liable for the accident that caused Marisol Morales’ death, asserting causes of action for motor vehicle negligence and general negligence, together with a survivorship action. Plaintiffs’ claim against Genentech was based on the doctrine of respondeat superior.

Genentech moved for summary judgment. The trial court entered judgment in favor of Genentech, dismissing it from the case and leaving Ong as the sole defendant. The court of appeal affirmed in the unpublished case of Morales-Simental v. Genentech.

Under the doctrine of respondeat superior, an employer is vicariously liable for the tortious conduct of its employees within the scope of their employment. The scope of employment has been interpreted broadly under the respondeat superior doctrine in California. Nevertheless, there are exceptions to the respondeat superior doctrine. Pursuant to the going and coming rule the employment relationship is ‘suspended’ from the time the employee leaves until he returns or that in commuting he is not rendering service to his employer.

An employee’s decision to take work home or to drive to work at an unusual time does not bring the trip within the scope of employment. Even accepting as true plaintiffs’ assertion that Ong took it upon himself to drive to Genentech on his day off to respond to a hiring crisis, an employee’s unilateral decision to commute to work after hours does not bring the trip within the special errand rule.

The court concluded by stating “we decline plaintiffs’ invitation to expand the special errand exception in the manner they suggest. What they propose is an invitation to self-serving pretense by anyone with a plausible claim to supervisorial authority.”

Sessions Identifies California as Opioid “Hot-Spot”

The U.S. attorney general isn’t letting up on efforts to go after doctors and other medical professionals who overprescribe opioids.

Attorney General Jeff Sessions reiterated in speeches in West Virginia on Thursday and Pennsylvania on Friday that he is expanding efforts of the Opioid Fraud and Abuse Detection Unit, which was unveiled last month and is designed to combat the overprescribing of opioid painkillers that have contributed to the country’s opioid epidemic.

“I have assigned 12 experienced prosecutors to focus solely on investigating and prosecuting opioid-related healthcare fraud cases in a dozen ‘hot-spot’ locations around the country, places where they are especially needed,” he said. The locations include both southern West Virginia and western Pennsylvania.

The other states include Ohio, Florida, Michigan, Alabama, Tennessee, Nevada, Kentucky, Maryland, North Carolina and California.

Sessions said the prosecutors will be working with the FBI, the Drug Enforcement Agency and the Department of Health and Human Services to target and prosecute doctors, pharmacies and medical providers who have profited from the epidemic.

The Detection Unit is using data to track anomalies in the disbursement of prescription opioids to find those who are fueling the epidemic, he said.

“The data analytics team will help us to find the telltale signs of opioid-related healthcare fraud by identifying statistical outliers,” Sessions said. “They can tell us which physicians are writing opioid prescriptions at a rate that far exceeds their peers, how many of a doctor’s patients died within 60 days of an opioid prescription, the average age of the patients receiving these prescriptions that pharmacies are dispensing, and which pharmacies are dispensing a disproportionate amount of opioids in regional hot-spots for opioid issues.”

“Fraudsters might lie but the numbers don’t,” he said. “They give a clear indication of who we need to examine.”

In addition, Sessions announced that the Justice Department will award nearly $20 million in federal grants to help law enforcement and public health agencies address prescription drug and opioid abuse. That’s part of $58.8 million in funding announced Friday by the Department of Justice that will also strengthen drug court programs.

Those efforts build on earlier attempts to reverse the opioid epidemic. Sessions spoke about the action two months ago when the DOJ coordinated the largest healthcare fraud takedown in American history, with the arrest of more than 400 defendants. More than 100 defendants have been charged with opioid-related crimes, including many doctors, he said.

Acupuncture, Electrotherapy Reduced Opioid Use

With growing pressure on physicians to replace opioid medications for pain relief, scientists are focusing attention on non opioid pain relief strategies. A new study reviewed in Medical News Today illustrates some of the new findings.

Inadequate postoperative pain management has profound effects. Long-term influences of poor pain management include transition to chronic pain and prolonged narcotic consumption, which can result in opioid dependence, an epidemic in the United States. There is increased interest in nonpharmacological treatments to reduce pain after total knee arthroplasty (TKA; knee replacement). Yet, little consensus supports the effectiveness of these interventions.

An analysis of drug-free interventions to reduce pain or opioid use after total knee replacement found modest but clinically significant evidence that acupuncture and electrotherapy can potentially reduce and delay opioid use; evidence for other interventions, such as cryotherapy and preoperative exercise, had less support, according to a study published by JAMA Surgery..

Tina Hernandez-Boussard, Ph.D., of Stanford University, Stanford, Calif., and colleagues conducted a review and meta-analysis to evaluate the effectiveness of commonly used drug-free interventions for pain management after TKA. The researchers identified 39 randomized clinical trials (2,391 patients) that met criteria for inclusion in the analysis.

The most commonly performed interventions included continuous passive motion (CPM), preoperative exercise, cryotherapy, electrotherapy, and acupuncture. The researchers found moderate evidence that acupuncture and electrotherapy improved postoperative pain management and reduced opioid consumption. There was very low-certainty evidence that cryotherapy reduced opioid consumption, but no evidence that it improves perceived pain. The findings suggested that CPM and preoperative exercise do not help alleviate pain or reduce opioid consumption.

Several limitations of the study are noted in the article.

“As prescription opioid use is under national scrutiny and because surgery has been identified as an avenue for addiction, it is important to recognize effective alternatives to standard pharmacological therapy, which remains the first option for treatment,” the authors write.

Article: Drug-Free Interventions to Reduce Pain or Opioid Consumption After Total Knee Arthroplasty A Systematic Review and Meta-analysis, Tina Hernandez-Boussard, PhD et al., JAMA, doi: 10.1001/jamasurg.2017.2872, published online 16 August 2017.

Final Brief Filed in Lien Stay Constitutional Challenge

Dr. Eduardo Anguizola, who is facing multiple counts of insurance fraud filed by Orange County prosecutors, is the lead plaintiff who claims Labor Code 4615 – the automatic lien stay law – violates the procedural component of the due process clause because it immediately stays all liens without notice or a hearing.

The federal case was filed this May, and there have been several hearings in federal court on his request for a preliminary injunction halting the implementation of the new lien automatic stay law.

The final brief by the California Attorney General on behalf of DIR Director Christine Baker asserts that the lien claimants have not made their case. The AG says that despite “submitting 10 declarations and 53 exhibits, Plaintiffs have still failed to establish that due process is being denied to the parties in this case or to lien claimants more broadly.”

“Plaintiffs continue to confuse (1) whether existing procedures permit a lien claimant to challenge whether its liens fall within the parameters of Section 4615 and are thus subject to the stay (existing procedures do) with (2) whether a workers’ compensation administrative law judge (“WCALJ”) has the discretion to determine that the stay should not apply to a particular lien notwithstanding the provisions of the statute (no, the stay is automatic for liens within the statute’s parameters).”

The Attorney General further said that “Not one declaration demonstrates that a lien claimant followed proper procedures for requesting adjudication of an issue of law or fact by a workers’ compensation judge, and was wrongly denied that adjudication.1 Further, not one declaration demonstrates that any party claiming that a workers’ compensation judge wrongly refused to hear a Section 4615 lien issue followed proper procedures and filed either a petition for reconsideration or a petition for removal to the workers’ compensation appeals board (“WCAB”) to challenge the judge’s action or lack thereof.”

“Even after this latest of three rounds of briefing, Plaintiffs have failed to demonstrate that they are entitled to the preliminary injunctive relief that they seek. Their motion should be denied.”

“Missing from the declarations are any examples of lien claimants who attempted to raise Section 4615 issues using the proper procedures provided in the regulations and described in Judge Levy’s declaration, and who have had those efforts rejected.”

“These conclusory allegations are insufficient to establish the violation of lien claimants’ due process rights by operation of Section 4615 and cannot support a preliminary injunction invalidating the statute on its face. They also fail to establish a likelihood of irreparable harm. To the extent Plaintiffs’ allege irreparable harm stemming solely from the deprivation of Plaintiffs’ due process rights, their failure to offer sufficient evidence to support their procedural due process claims also dooms their claim of irreparable harm.”

The next and perhaps final hearing on the preliminary injunction is set on this Thursday, September 28, 2017 at 8:30 am in courtroom 9D in downtown Los Angeles.

Another Drugmaker Pleads Guilty – Pays $40M Fine

Aegerion Pharmaceuticals Inc will plead guilty to two misdemeanors and pay $40.1 million to resolve investigations into its marketing and sales of an expensive cholesterol drug, U.S. authorities said on Friday.

Reuters Health reports that the settlements will resolve long-running investigations into Aegerion, a subsidiary of Canada’s Novelion Therapeutics Inc, by the U.S. Justice Department and the U.S. Securities and Exchange Commission related to its drug Juxtapid.

Under the agreements, Aegerion will plead guilty to two misdemeanor drug misbranding violations of the Food, Drug and Cosmetic Act, pay $36 million to resolve cases by the Justice Department and pay $4.1 million to settle the SEC’s lawsuit. It also entered into a deferred prosecution agreement to resolve a charge that it conspired to violate the Health Insurance Portability and Accountability Act.

The settlements finalized agreements Aegerion disclosed in May 2016. The Cambridge, Massachusetts-based company in November merged with QLT Inc and became a subsidiary of the newly named Novelion. “We are eager to get the problems that occurred with Aegerion under prior leadership behind us, and we believe these agreements are in the best interest of shareholders,” Aegerion said in a statement.

Prosecutors said after the U.S. Food and Drug Administration in 2012 approved Juxtapid for treating a rare genetic condition that causes high cholesterol, Aegerion promoted it for patients who had not been diagnosed with the condition. Juxtapid, which cost $250,000 to $300,000 annually per patient, featured a black box warning on its label that it could cause serious liver and stomach problems, prosecutors said.

Sales representatives also were trained to tell doctors and patients that Juxtapid would “take patients out of harm’s way” and prevent “impending” heart attacks and strokes, despite the lack of data supporting those claims, prosecutors alleged.

Numerous patients discontinued using Juxtapid after suffering conditions including liver toxicity and gastrointestinal distress, prosecutors said.

The Justice Department said Aegerion’s promotion of Juxtapid for patients without the genetic condition also led to false claims for payment to be submitted to government health care programs including Medicare.

The SEC alleged Aegerion also misled investors by exaggerating how many new patients filled prescriptions for Juxtapid.

The Justice Department said three ex-Aegerion employees who brought a whistleblower lawsuit against the company will receive $4.7 million as part of its civil settlement.