Tag: 2018 News

California signed up an estimated 450,000 people under Medicaid expansion who may not have been eligible for coverage, according to a report by the U.S. Department of Health and Human Services’ chief watchdog.

In a Feb. 21 report, the HHS’ inspector general estimated that California spent $738.2 million on 366,078 expansion beneficiaries who were ineligible. It spent an additional $416.5 million for 79,055 expansion enrollees who were “potentially” ineligible, auditors found.

Auditors said nearly 90% of the $1.15 billion in questionable payments involved federal money, while the rest came from the state’s Medicaid program, known as Medi-Cal. They examined a six-month period from Oct. 1, 2014, to March 31, 2015, when Medicaid payments of $6.2 billion were made related to 1.9 million newly eligible enrollees.

There were limitations to the California review, however. The audit extrapolated from a sample of 150 beneficiaries. The authors reported a 90% confidence level in their results – whereas 95% would be more common. That meant that the number of those ineligible could have been as low as 260,000 or as high as 630,000.

“If HHS has a strong reason to believe that California is systematically making enrollment errors, it would be helpful to show that in a more robust analysis,” said Ben Ippolito, a health care economist at the American Enterprise Institute, a conservative think tank. “The federal government should ensure that states are being good stewards of federal money.”

Nonetheless, the audit highlighted weaknesses in California’s Medicaid program, the largest in the nation with 13.4 million enrollees and an annual budget topping $100 billion, counting federal and state money. Medicaid covers 1 in 3 Californians.

The inspector general found deficiencies in the state’s computer system for verifying eligibility and discovered errors by caseworkers. The Medicaid payments cited in the report covered people in the state’s fee-for-service system, managed-care plans, drug treatment programs and those receiving mental health services.

California’s Department of Health Care Services, which runs Medi-Cal, said in a statement that it agreed with nearly all of the auditors’ recommendations and that the agency “has taken steps to address all of the findings.” In a written response to the inspector general, California officials said several computer upgrades were made after the audit period and before publication of the report that should improve the accuracy of eligibility decisions.

During the audit period, 12 enrollees in the sample group had incomes above 138% of the federal poverty line, making them ineligible financially for public assistance, according to the report. In other instances, beneficiaries were already enrolled in Medicare, the federal health insurance for people 65 and older or who have severe disabilities, and did not qualify for Medi-Cal. One woman indicated she didn’t want Medi-Cal but was enrolled anyway.

In a similar audit released in January, the inspector general estimated that New York spent $26.2 million in federal Medicaid money on 47,271 expansion enrollees who were ineligible for coverage. (The sample size there was 130 enrollees.) Overall, New York had far fewer expansion enrollees and related spending compared to California.

Audits of other states’ records are planned.

Nationwide, Medicaid, the state-federal health insurance program designed for the poor, is the country’s largest health insurance program, covering 74 million Americans. In the past year, Republican efforts to reduce Medicaid funding and enrollment have sparked intense political debates and loud protests over the size and scope of the public program.

The California audit didn’t request a specific repayment from the state, but the findings were sent to the U.S. Centers for Medicare & Medicaid Services for review. CMS officials didn’t return a request for comment.

Dr. Christopher Dean Owens was arrested in Indiana on July 11th, 2017, as part of the largest health care fraud enforcement action in the Department of Justice’s history. The former San Francisco vascular surgeon initially entered a not guilty plea on the drug charges, 36 counts of distributing oxycodone.He worked at the university-affiliated Veterans Affairs Medical Center in San Francisco

Owens’ profile on the university website said he is a 1998 graduate of Indiana University’s school of medicine and listed nine research grants and 70 published studies under his name. Another site listed him as a specialist in vascular surgery, aneurysms, deep vein thrombosis and diseases of the carotid artery.

One of his alleged victims, Danielle Pattillo, was found dead in her apartment under what investigators called suspicious circumstances. 35 year old Danielle Pattillo worked at the Veteran’s Affairs Medical Center with Owens. She mysteriously died in what investigators initially thought was a mere drug overdose.

But Paul Pattillo, who was in the midst of a divorce with Danielle, said she had become involved with Owens. She was found deceased and he was the last person who was with her.

Owens was immediately placed on investigatory leave by the University, UCSF fired him five months later after he was booked on local drug charges. But those charges with the San Francisco District Attorney’s office never stuck.

DEA agents also arrested Owens as part of the nationwide crackdown on fraudulent opioid prescriptions spearheaded by Attorney General Jeff Sessions.

The federal indictment alleged that between September of 2012 and June of 2015, Owens, who had moved to Indiana, intended to act outside the course of usual professional practice and without a legitimate medical purpose when he prescribed oxycodone on numerous occasions. In sum, Owens is charged with 36 counts of distributing oxycodone, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(C).

Owens pleaded guilty to Count 36 of the indictment in open court in San Francisco this month, but the court may consider evidence relating to Counts 1 through 35 at sentencing. Judge Alsup scheduled Owens’s sentencing hearing for July 17, 2018, at 2:00 pm. The maximum statutory penalty for the violation of 21 U.S.C. § 841(a)(1) and (b)(1)(C) is 20 years’ imprisonment and a fine of $1,000,000 plus restitution, if appropriate.

“I just think this shows that the *federal* courts are going to take this seriously and start cracking down and they need to,” said Pattillo.

His California Physicians and Surgeons certificate was revoked by the Board of Medicine in June, 2017.

A WCJ issued a Findings of Fact wherein she found that lien claimant Monrovia Memorial Hospital is not barred from proceeding on its lien due to a “dismissal” notation in the Electronic Adjudication Management System (EAMS) pursuant to Jose Guillermina Rodriguez v. Garden Planting Co., et al. (2017) 82 Cal.Comp.Cases 1390 (Appeals Bd. en banc).

The WCJ then found that lien claimant had until the close of business at 5:00 p.m. on Monday, July 3, 2017 to file a lien claim declaration pursuant to Labor Code section 4903.05.

Defendant contends that lien claimant’s lien is dismissed by operation of law because its section 4903.05(c) declaration was not timely filed before the close of business, i.e., 5:00 p.m., on Friday,June 30, 2017 pursuant to section 4903.05, subsection (c)(2); and because it was unsigned in violation of subsection (c)(3).

The Appeals Board issued an en banc decision in the case of Hernandez v Henkel Loctite Corporation, determining that Labor Code section 4903.05(c) declarations filed after the close of business at 5:00 p.m. on Friday, June 30, 2017 through the close of business at 5:00 p.m. on Monday July 3, 2017 are timely filed.

Labor Code section 4903.05(c)(2) states that lien claimants “shall have until July 1, 2017” to file the declaration identified in Labor Code section 4903.05(c)(1), thereby establishing the last date for performance of an act required by statute as July 1, 2017, a Saturday.

When the last date for performance of an act required by any workers’ compensation statute falls on a weekend or holiday, “the act or response may be performed or exercised upon the next business day.” (Cal. Code Regs., tit. 8, § 10508; see Code Civ. Proc., § 12a(a) and Gov. Code, § 6707.)

The Appeals Board clarified that pursuant to the plain language in Labor Code section 4903.05(c)(2) and WCAB Rule 10770.7, declarations filed at or before 5:00 p.m. on the next business day, Monday, July 3, 2017, are timely filed.

Another issue discussed in dicta was the validity of an electronic signature rather than a wet signature on lien documents filed in EAMS. “We note that our rules require all liens, including the supportive required documentation, to be electronically filed on an e-form approved by the Appeals Board and submitted by the Administrative Director’s electronic filing or JET-filing procedures. (Cal. Code Regs., tit. 8, § 10770(b)(1)(A), (B), and (C)(i).) The Administrative Director’s approved electronic filing technical requirements10 allow the use of an ‘S Signature,’ which shall be ‘rebuttably presumed to be that of the individual whose name is on the document signature line.’ (BR-16 S Signatures; Guide, p. 42.) Defendant compares section 4903.05(c) declarations to settlement documents; however, settlement documents require a ‘wet’ signature. (See BR-18 Wet/Actual Signatures [‘The following documents will require actual wet/actual signatures(s) be used: Scanned in signed settlement documents.’]; and Guide, p. 42.) The electronic signature rules and procedures adopted by the Administrative Director are consistent with California’s statutory rules of procedure. (See Civ. Code, §§ 1633.2, 1633.7.)”

En banc decisions of the Appeals Board are binding precedent on all Appeals Board panels and WCJs. (Cal. Code Regs., tit. 8, § 10341; City of Long Beach v. Workers’ Comp. Appeals Bd. (Garcia) (2005) 126 Cal.App.4th 298, 313, fn. 5 [70 Cal.Comp.Cases 109]; Gee v. Workers’ Comp. Appeals Bd. (2002) 96 Cal.App.4th 1418 [67 Cal.Comp.Cases 236].) This en banc decision is also adopted as a precedent decision pursuant to Government Code section 11425.60(b).

Indivior lost a second legal case in recent months in its battle to protect the patent of its opioid addiction treatment that generates 80 percent of its revenues.

A U.S. District Court ruled that American generic drugs maker Alvogen had not infringed three Indivior patents, the British company said, weakening its defense against rival versions of its big seller, Suboxone Film.

Indivior said it believed it has grounds to appeal.

The case comes six months after the Delaware District Court ruled Indivior could not rely on patents to stop Indian drugmaker Dr. Reddy’s launching a generic version of Suboxone Film.

Generic rivals in tablet form are already on the market in the United States which is grappling with an opioid addiction epidemic that killed 33,000 people 2015.

But Suboxone Film leads the market for a version which is placed under the tongue to suppress cravings. Its U.S. market share was 56 percent at the end of 2017, down from 61 percent the previous year.

Indivior is also in patent disputes with Allergan Plc’s Actavis Laboratories, Endo International’s Par Pharmaceutical, Teva Pharmaceutical Industries and Mylan NV. Indivior settled a case with Mylan in September.

Analysts said the impact of the latest ruling was “less significant” than the September one and most companies would remain wary of launching a generic against Indivior and Dr. Reddy’s was likely to be first.

Indivior launched a once-a-month injectable drug to suppress opioid craving in the United States this month. It hopes Sublocade will become a blockbuster medicine although expects initial sales to be slow.

Sublocade, which could be launched in Canada, Australia and Europe from late 2019, is designed to eliminate the risk that treatment drugs could be missed or misused.

While employed by Activor Corporation in 2007, Mahavir Mehta fell 12 feet off a ladder and sustained serious injuries, including one to his left wrist that required surgery. Activor did not carry workers’ compensation insurance and was not permissibly self-insured.

Mehta initiated workers’ compensation proceedings and sued Activor and the principle stockholder Chanda Zaveri for damages pursuant to Labor Code section 3706. The suit (Metha I) resulted in a judgment in plaintiff’s favor against Activor only in the total sum of $184,850.22, which included $129,850.22 in attorney fees. Through a writ of execution, plaintiff collected $55,000 from Activor.

After entry of the Mehta I judgment, Activor began transferring assets and accounts receivable to Chanda Zaveri and to Actiogen Corporation and Chanda LLC, two newly formed entities controlled by Zaveri. Activor subsequently initiated a “no asset” bankruptcy proceeding, omitting more than $900,000 accounts receivable due and owing to Activor.

In order to collect the outstanding attorney fee portion of the judgment, Mehta commenced this action (Mehta II) for compensatory and punitive damages against Activor, Zaveri, Actiogen, and Chanda based on common law and statutory fraudulent transfer theories.

The trial court awarded plaintiff compensatory damages of $207,760.35 and punitive damages of $621,781.05, for a total judgment of $829,041.40, plus interest, attorney fees and costs. There was no court reporter or live witness testimony. Instead, counsel stipulated the evidence would consist of deposition testimony and documents. The court of appeal modified but otherwise affirmed the judgment in the unpublished case of Mehta v Activor Corp.

On appeal defendants did not provide a settled statement or other suitable substitute. The clerk’s transcript was incomplete. Before any appellate briefs were filed, this court issued a briefing order, directing the parties to include in their briefs a discussion of the effect of defendants’ failure to provide most of the relevant papers as part of the record in an appendix. Defendants failed to heed the briefing order.

The court noted that where the appellate record is inadequate to permit us to assess whether the trial court has erred or the judgment is not supported by substantial evidence, it must affirm. A party on appeal has the duty to support the arguments in the briefs by appropriate reference to the record, which includes providing exact page citations. We have no duty to search the record for evidence and may disregard any factual contention not supported by proper citations to the record.

On appeal defendants contend the right to sue for the unpaid attorney fees portion is vested in plaintiff’s law firm, not plaintiff himself. Stated another way, defendants insist plaintiff is no longer a judgment creditor entitled to sue defendants for fraudulent transfers.

The Supreme Court acknowledged more than 80 years ago, a judgment for attorney fees belongs “to the party to the action for fees paid or incurred by him, and not directly to the attorney, who is not a party to the action.- (Los Angeles v. Knapp (1936) 7 Cal.2d 168, 173.).

The trial court found by clear and convincing evidence that all defendants entered into a fraudulent scheme.