PSI admitted having acted as a corruption channel to defraud healthcare programs. It will settle the case by paying 3 million dollars. Psi acted with dishonesty to obtain healthcare benefits of patients covered by Medicare parts B and D. According to the evidence, PSI could be liable to even a more substantial fine, but this amount was agreed after a careful analysis of its financial performance. Therefore, the penalty is based on the current ability to pay for the role it played in creating illegal foundations purporting to help patients under medication of specific drugs but exploiting their benefits with the Medicare program. The indictment tabled revealed the PSI was collaborating with giant pharmaceutical firms to execute this fraudulent scheme. So far, the three firms associated with this conspiracy have also been charged.
It was established that they exploited the partial payment option given to patients in the programs. Patients are required to make payments of drugs as co-payment, which allows the insurance firm to meet a certain percentage of the cost, and the patients can meet the rest. Then, these patients can obtain prescription drugs under this arrangement that helps them to access controlled substances for severe diseases, including cancer. In the case of PSI and the other three firms implicated, they targeted the Medicare program. Its beneficiaries were paid bribes by the companies controlling the created foundations to buy specific drugs from specific pharmacies. While co-payment help checking the costs of the drugs, this fraudulent plan ensured patients do not get deterred form it as the cost they would incur was purportedly met by the foundation. However, an insurance program may investigate high costs when paying their part after their beneficiaries received the medication.
The legislation does not allow drug companies to make incentives or pay either directly or indirectly to beneficiaries of the program to influence their drug buying decision. It is, therefore, illegal to give anything of value to patients to buy specific drugs or buy them from a particular pharmacy. Additionally, third-parties, including charitable organizations, foundations, etc. are not allowed to facilitate the payments that not allowed, including the incentives to patients. However, according to the court documents, PSI was found guilty of acting as a conduit of kickbacks because it formed foundations that were used by the companies to induce patients to buy certain drugs even when they did not require them for medical purposes.
In this case, PSI Formed foundations that operated contrary to the provisions by channeling the money disguised as charitable donations to the beneficiaries for drug payment. The payment was made as co-payment, and the Medicare program met the rest of the costs. The kickbacks ensured patients bought drugs from certain pharmaceutical firms only. There was sabotage to the business of the manufactures of alternative medications as they lacked market. Moreover, the conflict of interest in foundation operation and funding impaired the integrity of the drug administration and disease control in some instances; some fund donors would dictate the price and amount of benefits the patients would receive. In most cases, the patients had no option in the medication, and thus the demand and costs of the drugs promoted by the funds would significantly increase.
The three accused accomplices of PSI include Insys, Aegerion, and Alexion. All of them are drug manufacturing firms, and they received money from the foundation run by PSI. In turn, they paid the patients who they attended, and their drugs were thus demanded more than those treating similar problems. The specifically targeted medicines were allegedly influenced by the fund donor, who, in this case, was the drug maker. The competitive drug makers would thus not sell drugs as the patients were not incentivized to buy them. These allegations were traced back from 2010 Alexion is reported to have approached PSI to broker a deal by creating a fund. The foundation was targeting to promote Soliris, a drug sold by Alexion in co-pay arrangements to Medicare patient beneficiaries. With the fund formed and run by PSI, patients were referred to using the medicine even when the alternative drugs were available at a cheaper price. Alexion paid bribes to the patients who accepted the drug regardless of the price as the healthcare program was catering for the cost.
Similarly, in 2013, PSI is accused of entering into another deal to set up another fund with Insys Therapeutics. The business relationship also involved co-payments targeting Subsys opioid users; a drug sold Insys to cancer patients. The illegal fund created by the two firms enabled Isnys to control its operations, decide who benefited, etc., as Insys was the only donor. Several other misconducts have been reported in connection with marketing this drug, and recently a former sales director was convicted for conspiring with healthcare professionals to induce it on patients who even did not need it. Similarly, Insys referred even non-cancer patients to the fund to enable them to receive the medicine even when it was unnecessary. While psi was aware of its partner’s illegal referrals, it allowed it to continue since it was donating the money to the fund. In the third accomplishment, Aegerion also requested PSI to create a fund for HoFH patients targeting a drug it sold. The foundation was used to pay kickbacks and unauthorized co-payments for the Medicare beneficiaries.
PSI contravened the anti-kickback statute by allowing its operations to act as corruption conduits. This matter involves qui tam prosecution where a whistleblower aided the government in stopping this type of crime. As a civil matter, PSI consented to the allegations, and although the actual liability was not established, the company will pay at least 3 million dollars. Individuals can also be prosecuted for criminal liability for corruption allegations. The legal consequences include expulsion from service delivery, jail term, fines, and forfeiture of property. However, corporations and individuals may be sued under this provision when they are not guilty. If such an event occurs, the accused must get together a reliable defense team to fight for their justice in courts. Healthcare Fraud Group is an excellent team of defense lawyers that have been working with clients wrongly accused of healthcare fraud charges. Anyone looking to maintain their innocence in court and are facing similar charges should take a step of contacting our criminal defense attorneys at 888-402-4054 to speak to a legal expert in healthcare fraud.