Reprinted from REPORT ON MEDICARE COMPLIANCE, the nation's
leading source of news and strategic information on Medicare compliance, Stark
and other big-dollar issues of concern to health care compliance officers.
By Nina
Youngstrom, Managing Editor
June 8, 2015 Volume
24 Issue 21
In a pure TRICARE case, a compounding
pharmacy agreed to pay $3.775 million to settle false claims allegations that
it billed for prescriptions written by a physician who is married to an
executive at the pharmacy, the U.S. Attorney’s Office for the Middle District
of Florida said June 1.
MediMix Specialty Pharmacy LLC in
Jacksonville allegedly billed TRICARE for compounded drugs that were not
reimbursable from Jan. 1, 2009, to Dec. 31, 2014, according to the settlement.
The prescriptions were written by Ankit Desai, M.D., who is married to a
MediMix senior vice president, the settlement said. The U.S. attorney’s office
notes that Desai is a party to the settlement.
“The United States contends these
prescriptions resulted in improper referrals and were not appropriately
reimbursable,” the settlement says. Desai sent hundreds of prescriptions to the
compounding pharmacy and was its top referring physician, the U.S. attorney’s
office contends. Neither MediMix nor Desai admits liability in the settlement.
The allegations play like a violation
of the Stark law, but Stark doesn’t apply to TRICARE. “Recognizing this
problem, we asserted that the claims submitted by Dr. Desai were tainted by an
improper financial arrangement that was designed to defraud TRICARE,” says Amy
Filjones, a spokeswoman for the U.S. attorney’s office. “In support of this
position, we relied on 32 CFR Sec. 199.9, which prescribes certain
‘administrative remedies for fraud, abuse and conflict of interest’” in
TRICARE. The regulation defines “fraud” as “[a]rrangements by providers with
employees, independent contractors, suppliers, or others which appear to be
designed primarily to overcharge the [TRICARE program] through various means
used to divert or conceal improper or unnecessary costs or profits.”
The conduct at the heart of the case
came to the attention of the U.S. attorney’s office through mining of
reimbursement data. In mining these data, “MediMix was identified as a top
biller of compounding pain prescriptions,” a U.S. attorney press release notes.
TRICARE is another vehicle for false
claims cases, and this settlement may spark more interest among whistleblowers,
says attorney Alan Rumph, with Baker Donelson in Atlanta, Ga. They may be able
to make arguments using the TRICARE regulations that they can’t with the Stark
law, which has explicit exceptions, he says. For example, under Stark, an
entity providing designated health services can have a financial relationship
with the spouse of a referring physician as long as it’s not an investment
interest and as long as the compensation relationship satisfies an exception
(e.g., it’s fair-market value), Rumph says. In contrast, the TRICARE
regulations are more open-ended.
“Section 199.9 is pretty broad and
captures all kinds of provider fraud involving the TRICARE program,” notes
Washington, D.C., attorney Donna Lee Yesner, with Morgan Lewis.
Read the press release at http://tinyurl.com/qxte2rs.
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