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Tag: 2017 News

SCS for Back Pain – Another Opioid Alternative

Chronic pain affects up to 20% of people in developed countries, and represents not only a profound impact on individuals and their families but also a sizeable burden on employers, health care systems, and society in general.

Management of chronic pain varies greatly between nations and even within nations. Literature supports a multidisciplinary approach as the standard of care, although various health care systems may not always support this concept consistently.

A new study published in the Journal of Pain Research evaluates another safe and effective drug-free treatment option for chronic pain sufferers — spinal cord stimulation (SCS).

Spinal cord stimulation, also known as dorsal column stimulation, uses low-voltage electrical stimulation to the spine to block the feeling of pain, via a small device implanted in the body. The field of neuromodulation for the treatment of pain has developed rapidly since the seminal paper on the electrical inhibition of pain by the stimulation of the dorsal column almost 50 years ago. (Shealy CN, Mortimer JT, Reswick JB. Electrical inhibition of pain by stimulation of the dorsal columns: preliminary clinical report. Anesth Analg. 1967;46(4):489-491)

Patients typically undergo a trial of neuromodulation with an externalized power source and if this trial proves to be positive and compelling, they subsequently have a subcutaneously implantable pulse generator for the long-term therapy.

Spinal cord stimulation technologies are fast advancing, and an update of the literature was much needed. The newest study, authored by an Australian team, looks at recent evidence for safety, efficacy and cost-effectiveness of spinal cord stimulation in back and limb pain.

In recent years, the next phase in the evolution of neuromodulation has become available with the development of dorsal root ganglion (DRG) SCS and the emerging use of two novel advances in stimulation frequencies, being high-frequency SCS (at 10,000 Hz) and burst SCS.14-19 These recent advances have improved the efficacy and expanded the applicability of SCS.

The authors reviewed the scientific evidence from three studies looking at the different routes of spinal cord stimulation: dorsal root ganglion SCS, burst wave form SCS and high frequency 10 (HF10) SCS. They found that the literature supports the use of traditional SCS for chronic pain, and provides high-quality evidence that dorsal root ganglion SCS and HF10 SCS are safe and effective for back and leg chronic pain.

Lead author Paul Verrills from the Metro Pain Group in Melbourne, Australia, thinks the study findings represent “unheralded evidence that we can safely treat back and leg pain using spinal cord stimulation techniques.” Most importantly, spinal cord stimulation has relatively few side effects compared to other chronic pain therapies, and reduces the risks of complications.

Verrills goes on to say, “Spinal cord stimulation should now be considered earlier in the treatment continuum and not simply as an end-stage salvage therapy.”

CBT for Chronic Pain – Another Opioid Alternative

Cognitive behavioral therapy (CBT) is a treatment alternative for the millions taking opioids for noncancer pain, according to an article in the Journal of Psychiatric Practice.

“Cognitive behavioral therapy is a useful and empirically based method of treatment for pain disorders that can decrease reliance on the excessive use of opiates,” write Drs. Muhammad Hassan Majeed of Natchaug Hospital, Mansfield Center, Conn., and Donna M. Sudak of Drexel University College of Medicine, Philadelphia. They discuss evidence supporting the use of CBT to avoid or reduce the use of opioids for chronic pain.

Rising use of opioid medications to treat chronic noncancer pain is a major contributor to the US opioid crisis. But despite the aggressive marketing and prescribing of these powerful painkillers, there has been little change in the amount and severity of pain reported by Americans over the past decade. “There is no evidence that supports the use of opioids for the treatment of chronic pain for more than one year, and chronic use increases the serious risks of misuse, abuse, addiction, overdose, and death,” Drs. Majeed and Sudak write.

They believe that CBT is an important alternative to opioids for treatment of chronic pain. The goal of CBT is to help patients change the way they think about and manage their pain. The idea is not that pain (in the absence of tissue damage) “is all in your head” — but rather that all pain is “in the head.” Cognitive behavioral therapy helps patients understand that pain is a stressor and, like other stressors, is something they can adapt to and cope with.

Interventions may include relaxation training, scheduling pleasant activities, cognitive restructuring, and guided exercise — all in the context of an “empathic and validating” relationship with the therapist. These interventions “have the potential to relieve pain intensity, improve the quality of life, and improve physical and emotional function,” according to the authors.

“Therapy helps the patient see that emotional and psychological factors influence perception of pain and behaviors that are associated with having pain,” Drs. Majeed and Sudak write. “Therapy…puts in place cognitive and behavioral strategies to help patients cope more successfully.”

The authors cite several recent original studies and review articles supporting the effectiveness of CBT and other alternative approaches for chronic pain. Studies suggest that CBT has a “top-down” effect on pain control and perception of painful stimuli. It can also normalize reductions in the brain’s gray matter volume, which are thought to result from the effects of chronic stress.

Cognitive behavioral therapy is moderately effective in reducing pain scores, while avoiding or reducing the opioid risks of overuse, addiction, overdose, and death. It can be used as a standalone treatment; in combination with other treatments, including effective non-opioid medications; or as part of efforts to reduce the opioid doses required to control chronic pain.

Unfortunately, CBT and other nondrug treatments are underused due to unfamiliarity, time pressure, patient demands, ease of prescribing medications, and low reimbursement rates. Drs. Majeed and Sudak note that significant investment of resources will be needed to train practitioners and to widely integrate the use of CBT into chronic pain treatment. The authors suggest that the President’s Commission on the opioid crisis might fund such training programs as a preventive strategy to curb opioid abuse.

“There is a need for a paradigm shift from a biomedical to a biopsychosocial model for effective pain treatment and prevention of opioid use disorder,” Dr. Majeed comments. “Increased use of CBT as an alternative to opioids may help to ease the clinical, financial, and social burden of pain disorders on society.”

7th Year of Sim Carlisle Hoffman M.D. Fraud Prosecution

In May 2011, Sim Carlisle Hoffman M.D. was indicted on 884 felony counts alleging healthcare insurance fraud in violation of section 550. Hoffman was the owner of Advanced Professional Imaging (API), Advanced Management Services (AMS), and Better Sleeping Medical Center (BSMC) in Buena Park, and prosecutors accused him of running a “medical mill” for the sole purpose of insurance over-billing without providing any legitimate treatment to patients.

Orange County District Attorney Tony Rackauckas and California Insurance Commissioner Dave Jones originally announced the hundreds and hundreds of charges against Hoffman, BSMC neurologist Dr. Michael Heric of Malibu, Hoffman’s administrator Beverly Mitchell of Westlake Village and API billing collector Louis Santillan of Chino Hills.

The 2011 indictment was ultimately dismissed in 2013 on the ground that the prosecution had failed to provide exculpatory evidence to the grand jury.

Rather than proceed by indictment, in January 2014, the prosecutors filed a felony complaint against Hoffman. The complaint alleged 159 counts of insurance fraud. One year and one-half later – after four amendments and two demurrers – the people filed a fifth amended complaint, alleging violations of section 550, subdivision (a)(5) (33 counts), subdivision (a)(6) (135 counts), and subdivision (a)(7) (one count).

The preliminary hearing began on September 1, 2015, and ended on November 23 of that year. The resulting transcript spanned over 2,300 pages. Over 53,000 pages of documentary evidence was submitted. During the preliminary hearing, the complaint was amended again. This final amendment contained 102 counts alleging a violation of section 550, subdivision (a)(6), and one count alleging a violation of subdivision (a)(5). Defendant was held to answer on all 103 counts.

Following the preliminary hearing, prosecutors filed an amended information containing 121 counts: 120 counts of violating section 550, subdivision (a)(6), and one count of violating subdivision (a)(5). the amended information, for each count, included both patient names and references to the preliminary hearing exhibit numbers containing the evidence relevant to the particular offense.

The court overruled a demurrer to several counts, finding notice to be adequate, and concluded the People were permitted to allege multiple acts that form the basis of each count. It cautioned, however, that there was still work to be done before setting a trial date to ensure the defendant had clarity on what he would need to defend against at trial.

In response, Hoffman filed the present petition for a writ of mandate directing the court to sustain the demurrer. The Court of Appeal initially summarily denied the petition. But the California Supreme Court granted review and instructed the Court of Appeal to issue an order to show cause.

The issue is whether an information may allege a single offense in a single count, but describe within that count multiple discrete acts, each of which constitute the charged offense.

The Court of Appeal just concluded this month that the information was proper and denied the writ petition in the published case of Sim Carlisle Hoffman v The Superior Court of Orange County.

Each count alleges a single offense. Any complications, or undue prejudice to defendant, arising from the fact that multiple discrete acts may constitute the charged offense in each count are adequately dealt with by a unanimity instruction at trial, or by other tools at the court’s disposal, such as a severance of counts, or trial continuances where appropriate. A demurrer on these grounds is not the proper vehicle to address defendant’s concerns.

The court correctly overruled the demurrer.

Travelers Dodges Opiate Civil Litigation Coverage Bullet

The County of Santa Clara and the County of Orange brought a California civil lawsuit against various pharmaceutical manufacturers and distributors, including Actavis, Inc., Actavis LLC, Actavis Pharma, Inc., Watson Pharmaceuticals, Inc., Watson Laboratories, Inc., and Watson Pharma, Inc. to seek redress for the costs of the opioid epidemic.

The California Action alleges the companies engaged in a “common, sophisticated, and highly deceptive marketing campaign” designed to expand the market and increase sales of opioid products by promoting them for treating long term chronic, nonacute, and noncancer pain – a purpose for which the companies allegedly knew its opioid products were not suited. The City of Chicago brought a lawsuit in Illinois making essentially the same allegations.

The Chicago Complaint alleges: “The City’s health plans have also paid costs imposed by long term opioid use, abuse, and addiction, such as hospitalizations for opioid overdoses, drug treatment for individuals addicted to opioids, intensive care for infants born addicted to opioids, long-term disability, and more. The City’s workers’ compensation program and health benefit plans have expended approximately $2.4 million on addiction treatment services from May 2013 to May 2015.”

Some of the companies purchased general liability policies from The Travelers insurance company, and St.. Paul, The carriers declined to defend the companies. In September 2014, Travelers filed a California lawsuit to obtain a declaration it had no obligation under the St. Paul Polices or the Travelers Policies to defend or indemnify the companies it insured in connection with the California Action or the Chicago Action.

The trial court found that Travelers had no duty under the Policies to defend the insured companies. The court concluded (1) the California Complaint and the Chicago Complaint do not alleged an “accident” as required by the definition of “occurrence” (Travelers Policies) or “event” (St. Paul Policies) to create a duty to defend and (2) the Products Exclusions precluded coverage for Watson’s claims. The court deemed moot the issue whether the California Action or the Chicago Action “seek damages for” or “because of” potentially covered “bodily injury.”

The Court of Appeal affirmed in the published case of The Travelers Property Casualty Company of America v Activis Inc., et. al.

The policies cover damages for bodily injury caused by an “accident,” a term which has been interpreted to exclude the insured’s deliberate acts unless the injury was caused by some additional, unexpected, independent, and unforeseen happening. The California Action and the Chicago Action do not create a potential for liability for an accident because they are based, and can only be read as being based, on the deliberate and intentional conduct of the companies that produced injuries – including a resurgence in heroin use – that were neither unexpected nor unforeseen.

In addition, all of the injuries allegedly arose out of products or the alleged statements and misrepresentations made about those products, and therefore fall within the products exclusions in the policies.

Medicare Spends $4.1B on Opioids Yearly

A total of 14.4 million beneficiaries of Medicare Part D, which offers Medicare recipients the opportunity to get federally subsidized prescription drug coverage, received at least one prescription for an opioid in 2016 while the Medicare Part D program paid about $4.1 billion to provide them with those drugs, according to a study by the inspector general for the Department of Health and Human Services.

Nationwide, 33 percent of all Medicare Part D beneficiaries got federally funded opioids in 2016. In Alabama, it went as high as 46 percent; in Mississippi, it was 45 percent; and, in Arkansas, it was 44 percent.

The IG’s discovery that 14.4 million Medicare Part D beneficiaries got an opioid prescription in 2016 was cited in a Government Accountability Office report.

‘The Centers for Disease Control and Prevention (CDC), reported that from 1999 to 2014 the rate of drug poisoning deaths from prescription opioids nearly quadrupled from 1.4 to 5.1 per 100,000 people,’ said the GAO report. ‘In addition, the Department of Health and Human Services (HHS) Office of Inspector General (HHS-OIG) reported that 14.4 million people (about one-third) who participate in Medicare Part D received at least one prescription for opioids in 2016, and that Part D spending for opioids in 2016 was almost $4.1 billion.”

The inspector general’s report – “Opioids in Medicare Part D: Concerns about Extreme Use and Questionable Prescribing” – was completed in July. “In 2016,” said the IG report, “one out of every three beneficiaries received at least one prescription opioid through Medicare Part D.”

Some of the Medicare Part D beneficiaries received an opioid prescription only for a short period of time. But others received an opioid on what the IG called “a regular basis” – and some received “high” or “extreme” amounts.Some beneficiaries also appeared to be “doctor shopping” in pursuit of opioids. The IG report stated:

— “Specifically, 5 million beneficiaries received opioids for 3 months or more in 2016.”
— “A total of 501,008 beneficiaries received high amounts of opioids through Medicare Part D in 2016. This does not include beneficiaries who had cancer or were in hospice care.”
— “A total of 69,563 beneficiaries received extreme amounts of opioids for the entire year, putting them at serious risk of opioid misuse or overdose. Each of these beneficiaries had an average daily MED [morphine equivalent dose] that exceeded 240 mg for the entire year, This extreme amount is more than two and a half times the dose the CDC recommends avoiding for chronic pain patients.”
— “A total of 22,308 beneficiaries appear to be doctor shopping. Each of these beneficiaries received a high amount of opioids – an average daily MED that exceeded 120 mg for at least 3 months – and have four or more prescribers and four or more pharmacies in 2016. Typically, beneficiaries who receive opioids have just one prescriber and one pharmacy.”

The IG also report noted that a number of prescribers – including doctors, nurses and physician assistants – also exhibited extraordinary patterns in the opioid prescription they issued to Medicare Part D beneficiaries:

The report recommended that the Centers for Medicare and Medicaid Services: “(1) gather information on the full number of at-risk beneficiaries receiving high doses of opioids, (2) identify providers who prescribe high amounts of opioids, and (3) require plan sponsors to report to CMS on actions related to providers who inappropriately prescribe opioids.”

Chatsworth Medical Suppliers Sentenced

Acting U.S. Attorney Duane A. Evans announced that Geoffrey Ricketts, age 48, and Samuel Kim, age 42, both of Porter Ranch, California, were sentenced this month after previously pleading guilty to conspiracy to commit health care fraud.

U.S. District Judge Eldon E. Fallon sentenced Geoffrey Ricketts to to 46 months imprisonment. Samuel Kim was sentenced to 25 months imprisonment. In addition, Geoffrey Ricketts and Samuel Kim owe restitution in the amount of $1,338,210 and $988,593 respectively.

Geoffrey Ricketts, Samuel Kim, along with co-defendants Marla Ricketts and Sunyup Kim were indicted on June 11, 2015, for their direction of a $38 million fraud scheme centering around the distribution of “talking glucose meters” that were not medically needed and were often not even requested.

The defendants operated Care Concepts, LLC, which was based in Metairie and Choice Home Medical Equipment and Supplies (Choice), which was based in Chatsworth, California.

According to court documents, the defendants paid kickbacks to workers at call centers in California and South Carolina, from which operators would cold-call Medicare recipients to convince them to accept talking glucose meters and related supplies. From 2007 through 2015, the defendants caused thousands of claims to be submitted to Medicare through Care Concepts and Choice, virtually all of which were fraudulent.

Marla Ricketts pleaded guilty on January 5, 2017, to conspiracy to commit health care fraud and was sentenced to five years of probation and ordered to pay $39,880.46 in restitution.

Sunyup Kim pleaded guilty on September 7, 2017, to conspiracy to commit health care fraud and was sentenced to twelve months and one day imprisonment, followed by two years of supervised release. Additionally, KIM was ordered to pay $93,927 in restitution.

Acting U.S. Attorney Evans praised the work of the Federal Bureau of Investigation and the Office of Inspector General for the United States Department of Health and Human Services for investigating this matter. Assistant U.S. Attorneys Patrice Harris Sullivan and Jordan Ginsberg were in charge of the prosecution.

DWC Suspends 21 More Providers

The Division of Workers’ Compensation (DWC) has suspended 21 more medical providers from participating in California’s workers’ compensation system, bringing the total number of providers suspended this year to 73.

DWC Administrative Director George Parisotto issued Orders of Suspension against the following providers:

1) Christopher King of Beverly Hills, owner of medical-billing and medical-management companies, and his wife were the masterminds in a $40 million conspiracy to commit medical insurance fraud along with over two dozen doctors, pharmacists and business owners. More than 13,000 patients and at least 27 insurance carriers were victims in the scheme. King pled guilty in Orange County Superior Court on April 26 to two felony counts of conspiracy to commit medical insurance fraud and felony insurance fraud. King, co-owner of Monarch Medical Group, King Medical Management and One Source Laboratories, recruited doctors and pharmacists to prescribe unnecessary treatment for patients with workers’ compensation insurance.
2) Marisa Schermbeck Nelson of Torrance pled guilty on July 26 in Los Angeles County Superior Court for her involvement in a fraudulent $150 million workers’ compensation insurance billing and capping conspiracy with orthopedic surgeon Munir Uwaydah. Nearly two dozen patients were deceived by Dr. Uwaydah and his staff into undergoing surgeries they were told would be performed by Dr. Uwaydah, but were instead performed by a physician’s assistant who has never attended medical school. These patients were operated on under general anesthesia and without Dr. Uwaydah present in the operating room. The scheme included payments of up to $10,000 a month for illegal referrals.
3) Marlon Songco of Burbank, president of Rehab Dynamics, Inc., pled guilty in federal court on January 8, 2015 for paying illegal kickbacks as part of a Medicare fraud scheme along with co-conspirators Joseff Sales and Danniel Goyena. Department of Industrial Relations Newsline No. 2017-102 Page 2
4) Dolphus Dwayne Pierce II, chiropractor in Lemoore, was found guilty in Kern County Superior Court on January 8, 2016 of conspiracy to commit insurance fraud for billing insurance companies for services that were unnecessary, not rendered or double billed.
5) Julio Diaz, physician in Santa Barbara and Orange Counties, was found guilty in August 2015 on 79 counts of writing prescriptions for narcotics without a legitimate medical purpose.
6) Edward Balbas, physician in Rancho Cucamonga, pled guilty on May 5 in Riverside County Superior Court to two felony counts of insurance fraud for submitting more than 165 fraudulent bills over a three-year period. As part of his plea agreement, Balbas was required to pay multiple insurance companies restitution of over $650,000.
7) Randall William Tonelli, pharmacist in San Mateo, pled guilty in federal court on July 11, 2016 to knowingly offering to sell and trade a prescription drug sample and misbranding drugs for sale with the intent to defraud and mislead. Tonelli surrendered his pharmacist license on October 13, 2016.
8) Candelaria Valdez, medical services provider in Hemet, pled guilty in September 2016 in Riverside Superior Court to misdemeanor battery relating to abuse of a patient.
9) Bennie Johnson, osteopathic physician in Encinitas, had his license revoked by the osteopathic board on March 6. The board determined he had committed repeated acts of gross negligence in his treatment of multiple cancer patients.
10) Helen Chang, physician in San Diego, was disciplined by the Medical Board of California for incompetence and gross negligence in her treatment of a patient. She surrendered her medical certificate on November 1, 2015.
11) Raffiel Arvon Norwood of Rosamond, former vocational nurse, pled guilty in federal court on October 22, 2009 to felony possession of child pornography. Norwood surrendered his medical license on July 7, 2016. He was suspended from the Medi-Cal program last April.
12) Mark Anderson, dentist in Woodland, was found guilty in March 2009 on felony counts of sexual battery.
13) Jerry Tabuyo, operator of a community care facility for the elderly in San Jacinto, pled guilty in January to operating without a license.
14) William Richard Bailey, osteopathic physician in San Diego, had his medical license revoked following conviction for tax evasion in 2016. He was sentenced to more than three years in federal prison and required to pay over $500,000 in restitution and fines.
15) James Francis Murphy of Encinitas, osteopathic physician, was convicted on federal charges of income tax fraud and evasion. He was sentenced to four years in prison commencing on February 24, 2015 and ordered to pay $447,528 in restitution. His medical license was revoked on October 24, 2016.
16) David Anderson, chiropractor in San Diego, pled guilty to mail and income tax fraud in 1997. He was suspended from participation in the Medicare and Medi-Cal programs on September 20, 2001.
17) Robert Craig Taylor, former chiropractor in Los Angeles, was convicted in March 2007 of misdemeanor burglary and identity theft, in September 2007 of felony possession of a controlled substance for sale and grand theft and in December 2007 of receiving stolen property, identity theft and commercial burglary. His chiropractic license was revoked effective October 25, 2009.
18) Matthew Cole, Newport Beach physician, pled guilty December 15, 2015 to federal charges of conspiracy to obtain controlled substances by misrepresentation, fraud, forgery deception and subterfuge. He was barred from participating in the Medi-Cal program following his conviction.
19) Joanne Benzor, Riverside physician, pled guilty in 2009 to two counts of driving under the influence of alcohol. Her medical license was revoked between May 18, 2012 and June 16, 2017, at which time it was reinstated subject to limitations.
20) Virginia Garrett of Sarasota, Florida, former registered nurse, was convicted on August 20, 2008 in Los Angeles Superior Court for reckless driving while under the influence of alcohol and drugs, with a prior conviction for driving with a blood alcohol content exceeding the legal limit. Her medical license was revoked by the Board of Registered Nursing on January 27, 2012.
21) Kenneth R. Geiger, physician in Sonoma, surrendered his medical license on April 2, 2008 following an evaluation that he suffers from an illness that impairs his ability to safely practice medicine.

AB 1244 (Gray and Daly), which went into effect January 1, introduced new changes to the workers’ compensation system and requires the division’s Administrative Director to suspend any medical provider, physician or practitioner from participating in the workers’ compensation system under certain circumstances such as the above.

Widow of Firefighter Gives Up on Death Benefits

The relatives of a private contractor killed in last year’s massive Soberanes Fire near Big Sur have given up pursuing their wrongful death lawsuit against the state of California.

Robert Reagan, 35, died after the bulldozer he was operating tipped over down an embankment several days after the epic Monterey County wildfire began in July 2016.

His widow, Morgan Kemple, and two young daughters filed a lawsuit in March, blaming Cal Fire for his death. Their suit sought compensatory damages and claimed that the firefighting agency was negligent in supervising operation of the dozer.

But a Monterey County Superior Court judge dismissed the lawsuit last month after the family decided to end its legal bid.

In court papers, the family’s lawyer, Cyrus Shahriari of Beverly Hills, wrote the suit was being dropped because his clients faced a California law that makes it difficult to win negligence claims against state government on incidents involving firefighting injuries.

The development left one Bay Area expert on employment law shaking her head. “The perverse outcome is that his family has nothing,” said Veena Dubal, an associate professor at UC Hastings College of the Law. “It’s a tragic situation.”

The company that employed Reagan was not providing its employees with workers’ compensation coverage at the time of the crash, which has made it difficult for his family to receive benefits from his death.

Kemple has not responded to requests for comment about the decision to drop the lawsuit. Last April, she said the lack of workers’ compensation made it tough for her young family to get by.

Separately, Monterey County prosecutors have filed criminal charges against the small firm that employed Reagan, Czirban Concrete Construction. Among the charges is insurance fraud and failure to provide workers’ comp. A preliminary hearing in the case is scheduled for Dec. 14.

California’s Division of Occupational Safety and Health (Cal/OSHA) has fined Czirban tens of thousands of dollars, and the Contractors State License Board has suspended the company’s license.

Word of the Reagan family’s dropped lawsuit comes as state workplace regulators investigate the private contractor that employed a water truck driver killed last month in Napa County while helping battle the Nuns Fire, because it also failed to provide workers’ compensation insurance.

Garrett Paiz, a 38-year-old volunteer firefighter from Noel, Missouri, died Oct. 16 after his truck overturned as he was descending Oakville Grade. The California Highway Patrol is looking into the causes of the crash.

AIG Files Fraud Lawsuit Built on Plea Agreement Admission

It what may be characterized as a federal lawsuit pieced together from evidence that exists across existing criminal and civil litigation, 14 AIG related companies seek restitution from nearly 30 named defendants who it claims fraudulently or illegally made claims for payment for providing worker’s compensation treatment on cases where AIG entities provided coverage. The 22 page federal lawsuit filed on October 31, 2017 lists the following entities as defendants:

– Healthsmart Pacific, Inc.
– Healthsmart Pacific, Inc. doing business as Pacific Hospital of Long Beach
– Long Beach Pain Center Medical Clinic, Inc. a California Corporation
– International Implants, LLC a California Corporation
– International Implants, LLC formerly known as SI Venture Partners LLC
– Michael D. Drobot, Sr. an individual
– Michael R. Drobot Jr. an individual
– Industrial Pharmacy Management LLC a California Corporation
– Venture Partners, LLC
– Long Beach Prescription Pharmacy a California Corporation
– Coastal Express Pharmacy, Inc. a California Corporation
– Meds Management Group LLC a California Corporation
– Pacific Specialty Physician Management, Inc. a California Corporation
– First Medical Management, Inc. a California Corporation
– Paul Richard Randall an individual
– Platinum Medical Group, Inc. a California Corporation
– Linda Martin an individual
– Daniel Capen an individual
– Daniel Capen, M.D., A Professional Corporation a California Corporation
– Southwestern Orthopedic Medical Corporation a California Corporation, Beneficiary and Heir to the Estate Of Downey Orthopedic Medical Group
– Southwestern Orthopedic Medical Corporation a California Corporation doing business as Channel Islands Orthopedic
– Westlake Surgical Medical Associates, Inc. a California Corporation
– Ismael Silva an individual
– Healthpointe Medical Group, Inc. a California Corporation
– National Intraoperative Monitoring a California Corporation formerly known as West Ocean Union Medical
– Southwest Hospital Development Group, Inc. a former California Corporation
– Starbase, Inc. a California Corporation
– Lokesh S. Tantuwaya an individual
– Dr. Lokesh S. Tantuwaya, M.D., Inc. a California Corporation

What stands out in the AIG lawsuit is its reliance on either admissions filed in plea agreements in other cases made by federally indicted  and convicted parties, or the deposition testimony already taken in related cases. In other words much of the evidence relied upon by AIG in their suit was available “in plain sight,” in plea agreements or discovery in other litigation. For example the AIG complaint quotes from data in other cases such as the following examples.

Paragraph 47 reads: On February 20, 2014, Drobot, Sr. pleaded guilty and admitted in his plea agreement that a) “Beginning in or around 1998 and continuing through in or around November 2013, he conspired with dozen of doctors, chiropractors, marketers, and others to pay kickbacks in return for those persons to refer thousands of patients to Pacific Hospital for spinal surgeries and other medical services;” b) “To help generate the monies for the kickback payments, defendant used a co-schemer’s company or his own company . . . to fraudulently inflate the price of medical hardware purchased by Pacific Hospital to be used in the spinal surgeries . . . “; and c) “In paying the kickbacks, inflating the medical hardware costs, and submitting the resulting claims for spinal surgeries and medical services, defendant and his co-conspirators acted with the intent to defraud workers’ compensation insurance carriers . . . ”

Paragraph 48 reads: Defendant Randall, who pleaded guilty in United States v. Randall, Case No. 12-cr-00023. Randall admitted in his plea agreement that his company, Platinum Medical “paid kickbacks to physicians for referring workers’ compensation patients for toxicology tests.”

Paragraph 49 reads: Randall also admitted in a March 9, 2016 deposition that he negotiated contractual agreements between Drobot Sr. and physicians to provide compensation for those doctors performing spinal surgeries at Pacific Hospital. He testified that there were “many” such agreements entered into between Drobot Sr. and doctors for compensation for spine surgeries at Pacific Hospital.

Paragraph 49 reads: In United States v. Linda Martin, Case No. 16-cr-00014. Martin admitted in her plea agreement that she “conspired with Drobot, other hospital employees, dozens of doctors, chiropractors, marketers, and others to pay kickbacks in return for referral of hundreds of patients to Pacific Hospital for spinal surgeries and other medical services paid for primarily through the California Workers’ Compensation System (“SWCS”) and the Federal Employees’ Compensation Act (“FECA”).”

Paragraph 59 reads: Documents produced by Pacific Hospital Fraud co-conspirators IPM, PSMP and/or International Implants (also referred to as “I2”) demonstrate that Capen, either directly or through Capen, M.D., received monthly “reimbursement” in the amount of $10,137.90 from May through September 2008, totaling $50,689.50. By November 2009, International Implants records reflect that “per surgery,” Capen was receiving $5,833 as a “monthly payment” and $8,333 as a “management fee.” Between January and June 2010, the co-conspirator records demonstrate that Capen performed 32 “Qualifying Fusions” for the Pacific Hospital Fraud, resulting in a $440,000 payment due.

Paragraph 71 reads: According to records produced in another litigation, Tantuwaya had a $70,000 “option” contract dated March 1, 2010, pursuant to which PSPM was to make payments to Tantuwaya “due on the 15th day of each succeeding month until aggregate pmts equal $15,000,000.” December 2010 PSPM records list his year-to-date payments as $510,000. January 2012 PSPM records list total payments to Tantuwaya from 2009-2012 as $943,900. December 2012 PSPM records list total payments to Tantuwaya as $1,453,900.

And the allegations continue to show that much evidence is contained in plea agreements signed by perpetrators in criminal cases, and depositions already taken in other civil actions against the same group of perpetrators. In other words the evidence is in “plain sight.” It is not that hard any more to piece together the pieces of a puzzle found across a variety of criminal and civil actions that show the big picture needed to prevail in a recovery action by an insurance company.

FDA to Force Drugmakers to Pull Painkilers

The head of the Food and Drug Administration recently warned that the agency will get much more aggressive with drug makers, potentially forcing companies to pull painkillers off the market.

FDA Commissioner Scott Gottlieb addressed the National Press Club in Washington arguing that the current opioid epidemic requires a much more “intrusive” response from federal regulators than previously expected. Gottlieb said that over the past decade the government failed to address the looming crisis, despite being aware of mounting problems concerning opioid addiction. .

The FDA will enact stricter standards for their own product review and approval process, including evaluating if the risks for abuse of the drug outweigh the legal benefits of the product. Popular painkillers previously approved by the FDA can be crushed up for snorting or injection.

“To try to get ahead of it now, I think we need to be willing to take much more dramatic action, be much more potentially intrusive than what we thought we might have to do and what would have been our comfort zone five years ago or 10 years ago,” Gottlieb said Friday, according to The Washington Examiner.

For the first time in history, the FDA ordered a drug maker to pull a medication off the market June 8 due to widespread reports of abuse. Endo Pharmaceuticals announced the decision to comply with the FDA request July 6 following an internal review of the drug.

The unprecedented move came in the wake of reports patients were crushing up the pills to inject. Representatives for Endo said they stand by the safety profile of Opana ER and believe the benefits outweigh the risks. They say the pill is safe and effective when administered properly, but will comply and work with the FDA on the issue.

The move reflects the FDA’s new focus on not just the prescribed risks of painkillers, but the risks posed by illegal abuse of the pills.

President Donald Trump declared the opioid epidemic a “public health emergency” Oct. 26, giving states hit hard by opioid addiction flexibility on how they direct federal resources to combat rising drug deaths.

Data from the National Institute on Drug Abuse released Sept. 7 predicts that the addiction epidemic in America will continue to deteriorate, pushing drug deaths to an estimated 71,600 in 2017. If the estimates prove accurate, 2017 will be the second year in a row that drug deaths surpass U.S. casualties from the Vietnam War.