This morning David DePaolo’s post describes the evolution of theft in California’s workers comp system, walking readers from physician dispensing of repackaged drugs to compounds (next up – blatant overuse of drug testing!).
David notes:
“The complaint…says Cyrus Sorat, owner of Health Care Pharmacy and Deutsche Medical Services in Tustin, Calif., paid 208 doctors to prescribe compound drugs to injured workers needing topical analgesics. Sorat promised to pay the doctors an unreported fee for each prescription they wrote, and also agreed to handle billing and recover receivables on behalf of the physicians, according to the complaint.
Seven of the doctors named are in Florida, Arizona, South Carolina and Puerto Rico, with the rest in California…
The complaint describes a complex scheme [wherein] the doctors named were allegedly paid kickbacks to prescribe the drugs, and the receivables for those prescriptions were then “handled” by the mastermind through several collection/management agencies and bill review companies that were created in a sophisticated scheme of fraud.”
Coincidentally, there’s also news [sub req] out that California regulators are – at long last – trying to close the loophole in the law that allows providers to get paid twice for the same medical device, a practice that, while technically legal, is most certainly not ethical or reasonable – it costs employers and taxpayers over a hundred million dollars a year…
That good news is somewhat overshadowed by a report from Michigan that an effort to restrict reimbursement of repackaged drugs to the cost of the underlying, non-repackaged drug may well be futile. The language under consideration does NOT reflect that requirement, and repeated efforts to get the regulators and legislators involved to correct the oversight have met with no success. If the regulation is approved, there is some faint hope that a court case may lead to an interpretation favorable to linking reimbursement to the underlying original manufacturer’s price.
Ideally, regulators will correct the oversight by inserting the word “original” into R 418.101003a(1)c…just after “Online” and before “manufacturer’s”…
If not, Michigan’s taxpayers and employers will continue subsidizing the lifestyles of the rich and famous.
I’m sure they’ll be okay with that…
