Tag: 2019 News

Covidien was an Irish-headquartered global health care products company and manufacturer of medical devices and supplies. It was purchased by Medtronic in a transaction that closed in 2015.

Covidien has agreed to pay $17,477,947 to resolve allegations that it violated the False Claims Act by providing free or discounted practice development and market development support to physicians located in California and Florida to induce purchases of Covidien’s vein ablation products.

Under the settlement agreement, Covidien will pay an additional $1,474,892 to California and $1,047,160 to Florida for claims settled by these state Medicaid programs. The Medicaid program is a jointly funded federal and state program.

The United States alleged that Covidien violated the Anti-Kickback Statute and, correspondingly, the False Claims Act by providing practice development and market development support to health care providers located in California and Florida from Jan. 1, 2011, through Sept. 30, 2014, to induce those providers to purchase ClosureFASTTM radiofrequency ablation catheters that were billed to Medicare and to the California and Florida Medicaid programs.

ClosureFastTM catheters are used in procedures that treat venous reflux disease, a disease often marked by the presence of varicose veins.

The practice and market development support Covidien provided included customized marketing plans for specific vein practices; scheduling and conducting “lunch and learn” meetings and dinners with other physicians to drive referrals to specific vein practices; and providing substantial assistance to specific vein practices in connection with planning, promoting, and conducting vein screening events to cultivate new patients for those practices.

The Anti-Kickback Act prohibits the payment of remuneration to induce the referral or use of items or services paid for by federal health care programs. Remuneration includes not only cash payments but also offers or payments made “in kind.”

The settlement resolves allegations contained in lawsuits filed by Erin Hayes and Richard Ponder (former sales managers for Covidien) and Shawnea Howerton (a former employee of one of Covidien’s customers), which are pending in federal court in San Francisco, California.

The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the United States for false claims and to share in any recovery. Mr. Hayes and Mr. Ponder will receive $3,146,030 as their share of the federal recovery.

Trial proceeded in the case of Ana Villanueva v Teva Foods, Travelers Insurance Company on December 12, 2018 on the issue of whether the lien of Firstline Health, Inc., should be subject to an automatic stay pursuant to Labor Code section 4615.

The WCJ found that applicant claimed an injury arising out of and in the course of her employment on October 11, 2012; that criminally charged providers Munir Uwaydah, M.D., and Paul Turley controlled Firstline pursuant to Labor Code section 139.21(a)(3); and, that Firstline’s Exhibit 73 is not admissible as it was not listed on the pre-trial conference statement.

The WCJ thus ordered that the lien of Firstline in this case is subject to a stay pursuant to section 4615.

Firstline filed a Petition for Reconsideration contending that as of October 11, 2010, David Johnson, M.D., was the sole owner and officer of Firstline and thus “controlled” Firstline pursuant to section 139.21(a)(3); that Dr. Johnson is not currently charged with any crime; and, thus, there are no grounds to impose a section 4615 stay against its lien in this case.

Defendant did not file an answer to Firstline’s Petition for Reconsideration.

The WCJ filed a Report recommending that Firstline’s Petition for Reconsideration be denied because defendant’s evidence indicates that Dr. Uwaydah exercised absolute control over Firstline despite the fraudulent identification of other individuals as owners, officers or directors of Firstline in official documents, which was done in order to hide Dr. Uwaydah’s ownership and control of Firstline from creditors, investigators, government agencies and law enforcement.

Mr. Turley states that Firstline was created to take over the fraudulent activities of Frontline, and that Dr. Uwaydah exercised the same absolute control over Firstline as he had over Frontline, even though others – including Dr. Johnson – were identified as owners, officers or directors:

Uwaydah fled the United States to Lebanon in June of 2010…In the Fall of 2010, Turley traveled to Lebanon to confer with Uwaydah and to discuss how to keep the Frontline Business operating without Uwaydah’s presence, and without his name being connected to the business.

Uwaydah told Turley that there was close to a billion dollars in receivables from Frontline and Firstline

Dr. Uwaydah’s control extends to the current criminal defense in this case. He has paid millions of dollars for the attorneys for the defendants, including defending Turley.

The WCAB on reconsideration said it concurs with the conclusion of the WCJ that defendant’s evidence, namely defendant’s Exhibit C, the “Factual Statement of Paul Turley dated 12/3/18” appears to establish prima facie grounds to impose a section 4615 stay against Firstline’s lien based on Dr. Uwaydah’s de facto ownership and control of Firstline.” The ruling is posted to its website as a “Significant Panel Decision.“

“However, the Turley Statement was produced on the eve of trial and thus, lien claimant did not have sufficient notice or opportunity to rebut the Turley Statement.”

Lien claimant objected that the Turley Statement was part of a plea arrangement in his criminal case wherein he pled guilty and got credit for time-served in exchange for his execution of this statement.

The Petition for Reconsideration, was granted, and the WCAB rescinded the F&O and returned this case to the trial level for further proceedings consistent with this decision. Firstline is thus afforded an opportunity to rebut the Turley Statement.

In a radiation-proof room at the Erasmus Medical Center in Rotterdam, Emar Thomasa sits behind shielded glass as he carefully measures and mixes lutetium octreotate, an intravenous treatment for certain types of cancer.

The Dutch hospital has been offering it to patients for more than a decade at 16,000 euros ($18,000) for one course of treatments. Drug firm Novartis, which in 2018 acquired rights to sell it in Europe, is asking more than five times that for its proprietary version, Lutathera.

Thomasa is part of a protest against high drug prices launched by an unlikely group of rebels: Dutch pharmacies.

Three – Erasmus, Amsterdam’s University Medical Center (UMC) and the Transvaal Pharmacy in The Hague – have vowed to bypass drug company products and make treatments for a handful of rare diseases themselves, exercising their right to “compound” medicines.

The dispute is part of a growing global backlash against high drug prices, from the United States and Canada to Japan, and campaigners said it was being closely watched by health experts elsewhere.

Compounding is the ancient practice of preparing medicines for individual patients. Pharmacists are trained to compound, though nowadays most medicines are made by industrial producers.

UMC received a 5-million-euro grant last month to expand its compounding program. It plans to use the money to set up a center to swap know-how with pharmacies at home and abroad.

The worldwide push against high drug prices has seen the Trump administration in the United States declare bringing down prescription prices a top priority.

The Dutch pharmacies, whose production is on a small scale, acknowledge they may face legal challenges from the drug industry. However, such a case could set a precedent for other European countries.

Pharmacies retain the right under European and American law to prepare medicines for individual patients. Common examples including making lower dosage versions for children or liquid versions for people with difficulty swallowing.

However, in the United States, for-profit compounding pharmacies have tested the limits of what they are allowed to do in recent years, including mixing medicines in large quantities. In some cases, that has prompted legal conflicts with drugmakers.

Official scrutiny of the practice increased after the 2012 deaths in Massachusetts, which led to U.S. lawmakers requiring bulk compounding facilities to register with the Food and Drug Administration (FDA) and meet quality and labeling standards – still not as stringent as full FDA drug approval.

The first two drugs targeted by Dutch pharmacies are Novartis’s Lutathera and a drug called CDCA, registered in Europe by Leadiant.

Novartis boss Narasimhan said he was worried by developments in the Netherlands. “The Netherlands’ characterization that the local medicine that is made in the hospitals is the same as what we’ve done from a regulatory, full-development standpoint, particularly given (the Dutch) will house the European Medicines Agency, I think is troubling,” he told Reuters in an interview.

Paris-based Shift Technology has raised another $60 million funding round, and announced a new contract with CNA. Shift Technology claims to have a 70% hit rate in detecting fraudulent insurance claims.

Bessemer Venture Partners is leading the round and existing investors Accel, General Catalyst, Iris Capital and Elaia Partners are also participating.

This March it announced that it has entered into an agreement with CNA Financial Corporation, one of the largest commercial property and casualty insurance companies in the United States, to automate the carrier’s fraud detection capabilities. CNA is the first commercial insurer based in the United States to partner with Shift Technology to take advantage of FORCE, the company’s AI-native, SaaS-based fraud detection solution.

FORCE uses advanced artificial intelligence (AI) and data science to not only detect potentially fraudulent claims but also provide contextual guidance for investigation and resolution.

Unlike other technologies which rely heavily on the use of static business rules to identify those claims which may be non-meritorious, FORCE uses AI to analyze vast amounts of data from multiple sources. The result is a dynamically generated fraud score for each claim that indicates how suspicious the claim is, contributing factors, and how the claim could be investigated.

“CNA continues to focus on, and invest in, technology and analytics to advance claims,” said Rob Thomas, Senior Vice President of Claim Analytics, Finance and Operations for CNA’s Worldwide P&C Claim unit. “By partnering with Shift Technology, CNA will optimize its special investigations efforts by focusing on the most suspicious cases with pre-identified paths for investigation.”

There are 70 insurance companies around the world relying on its product, such as MACIF in France, Axa in Spain, and CNA and HyreCar in the U.S.

The startup has already grown quite a lot since its previous funding round. They now have 200 employees, and customers all around the globe. In addition to its headquarters in Paris, Shift Technology also has offices in Boston, London, Hong Kong, Madrid, Singapore and Zurich.

With today’s funding round, the company plans to hire more people in Boston, including data scientists and developers. The company is also developing an automated claim-processing solution.

Jorge Orozco was a carpenter for Southland Framers. On September 7, 2001, he sustained and industrial injury to his back, neck, and head, and filed three claims for benefits.

His primary treating physician noted in 2012 that he was ambulating with a wheeled walker and that his wife was providing continuous home care services for him. He said “Patient requires home care assistance. He is a candidate at least eight hours a day, five days a week for home care assistance to assist with bathing, dressing, food preparation, laundering, and cleaning.” The request was later increased to 12 hours a day.

On May 15, 2012, Anthem Workers’ Compensation, and the PTP agreed that, as part of the UR process, “a relatively expedited RN evaluation should be done to assess the patient’s needs.”

On July 25, 2014, 26 months after this agreement, the nurse case manager performed the evaluation. She found applicant “requires maximum assistant with the majority of his activities of daily living.” She recommended home health care assistance 12 hours per day, seven days a week to assist applicant with nutritional meal preparation, grocery shopping, grooming, hygiene, transfers into and out of the shower, bathing, dressing, transportation services and assistance in and out of vehicles, home cleaning, laundry, opening medication bottles, and verbal reminders to take medications.

The PTP reviewed nurse case manager’s report and adopted its recommendations in his own October 13, 2014 report. On October 17 he submitted an RFA to the employer.

On December 9, 2014, the RFA was denied on the grounds that the Medicare Benefits Manual indicates “services should be part-time and not exceeding 28 hours per week, and authorization should not be made if these services are regularly performed by a member of the patient’s household.” The RFA was received on November 25, 2014, and the decision to deny was made on December 8, 2014.

The WCJ found that defendant did not conduct timely utilization review of the May 9, 2012 and November 25, 2014 requests for authorization (RFAs) for home health care services. The WCJ also found that defendant was liable for home health care services after May 1, 2012, up to 12 hours a day, seven days a week.

Defendant contended on reconsideration that the WCJ erred by awarding home health care services, arguing that she should not have found that the UR determination was untimely, among other arguments. The WCAB affirmed the WCJ’s decision in the case of Orozco v Southland Framers, SCIF.

Here, the initial delay was timely. However, no UR determination issued within the statutory period, “14 days from the date of the medical treatment recommendation by the physician.” (Former L.C. § 4610(g)(l).).

The RFA was received no later than November 25, 2014. Former AD Rule 9792.9.l(e)(3), in effect at the time of defendant’s UR determination, provided in pertinent part, “[A] decision to modify, delay, or deny shall be communicated to the requesting physician within 24 hours of the decision, and shall be communicated to the requesting physician initially by telephone, facsimile, or electronic mail.” (Former Cal. Code Regs., tit. 8, § 9792.9.l(e)(3).

The record reflects that defendant’s UR notified the PTP of the determination on December 9, 2014, nine working days after receipt of the RFA on November 25, 2014, and four days after the statutory time period lapsed. Therefore, the Board has jurisdiction to determine the medical necessity of the requests for home health care services.