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On April 30th, 2018, Dr. Rita Luthra was convicted of violating the HIPAA Privacy Rule and of obstruction of a criminal health care investigation. A federal jury found that Dr. Luthra allowed a pharmaceutical sales representative to access her patient records and lied to federal investigators. Criminal charges under the federal Anti-Kickback Statute (“AKS”) were alleged initially but subsequently dropped.
Dr. Luthra’s conviction stems from her involvement with a pharmaceutical sales representative with Warner Chilcott. Warner Chilcott was the subject of a criminal investigation by the U.S. Department of Justice (DOJ) in 2015. The investigation resulted in Warner Chilcott pleading guilty to a felony charge of health care fraud and agreeing to pay $125 million to resolve criminal and civil liability arising from alleged illegal marketing practices of certain drugs.
According to the government, the Warner Chilcott sales representative asked Dr. Luthra to participate in the company’s speaker program because Dr. Luthra prescribed a high volume of osteoporosis medication. Dr. Luthra agreed and spoke at medical education and speaker training events held in her office. The events involved Dr. Luthra speaking to the sales representative for about thirty minutes while she ate food provided by the representative for Luthra and her office staff. Warner Chilcott paid Dr. Luthra approximately $23,500 for her services.
In January 2011, Warner Chilcott launched a new osteoporosis drug which Dr. Luthra prescribed. Many insurance companies required a prior authorization before covering the new drug. In response to receiving numerous denials for Dr. Luthra’s prescriptions for the new drug, she asked the sales representative to assist one of her medical assistants with obtaining prior authorizations. The sales representative agreed, was given access to Dr. Luthra’s medical records to complete the prior authorizations, and filled out the prior authorizations.
Dr. Luthra later provided false information to OIG investigators when interviewed about her relationship with Warner Chilcott. She was convicted of a criminal violation of HIPAA for the improper disclosure of her patients’ protected health information to the sales representative. It is illegal to knowingly disclose protected health information in violation of the Privacy Rule. Most HIPAA enforcement activities are in the form of civil enforcement. However, the Privacy Rule also establishes criminal penalties for certain wrongful disclosures of protected health information.
Dr. Luthra’s sentencing has not yet been scheduled. Nonetheless, Dr. Luthra’s HIPAA violation provides for a sentence of up to one year in prison and/or a fine of up to $50,000. The obstruction conviction carries a higher potential penalty of up to five years in prison and a fine of up to $250,000.
While criminal prosecutions of HIPAA violations are rare, this case serves as a reminder that HIPAA is more than a series of privacy and security rules; HIPAA establishes criminal liability and potential jail time for HIPAA violations. This case reflects the DOJ’s continuing scrutiny of physician-pharmaceutical manufacturer relationships, particularly those that can affect health care decision making. Providers should be mindful of their relationships with pharmaceutical companies, and third parties who may have access to protected health information. Moreover, if a provider is the subject of an investigation, he or she should be truthful and engage competent counsel at the early stages of the investigation.
For more information, or if you need assistance with an investigation or evaluating whether your relationships comply with HIPAA, please contact Miranda Preston or another health care attorney at Milligan Lawless.
The law mandates that, beginning October 1, 2017, physicians must consult a prescription monitoring program (PMP) prior to prescribing an opioid analgesics or benzodiazepine in schedules II-IV.
Under the new regulations, Arizona health care institutions must establish and implement more comprehensive plans and procedures for prescribing or ordering an opioid or administering an opioid.
Physicians who prescribe opioids, and health care institutions licensed by Arizona’s Department of Health Services, should be aware of this new law, and new rule. If you have any questions regarding these new laws, or would like assistance with updating your policies and procedures to conform to these requirements, please feel free to contact Milligan Lawless.
 SB 1283 (2016), signed by Arizona Governor Doug Ducey in 2016 amended A. R. S. § 36-2606.
 9 AZ Adc. Ch.10, Ariz. Admin. Code R9-10-120.
The use of electronic health records (EHRs) by physicians, hospitals, and other providers has dramatically increased in recent years. The federal government reports that 78% of office-based physicians are now using some type of EHR, up from only 18% in 2001. Additionally, while only 9% of hospitals had adopted EHRs in 2008, more than 80% are now meaningfully using the technology.
 Hsiao CJ, Hing E. ”Use and characteristics of electronic health record systems among office-based practices: United States, 2001-2013.” NCHS data brief, no 143. Hyattsville, MD: National Center for Health Statistics. 2014.
 Press Release, United States Department of Health & Human Services, “Doctors and hospitals’ use of health IT more than doubles since 2012.” (May 22, 2013).
The entire medical community is under high scrutiny when it comes to coding and billing. All too often medical providers are subject to coding audits or civil enforcement actions regarding coding and billing, or even criminal actions for improper coding and billing.
On March 31, 2014, Congress finalized legislation to temporarily prevent a scheduled decrease in Medicare reimbursements to providers that was set to take effect on April 1, 2014. The Protecting Access to Medicare Act of 2014, H.R. 4302, has now been sent to President Obama who is expected to quickly sign it. The law will delay the reductions for one year.
In the hope that Congress would intervene to prevent the reductions from taking effect, the Centers for Medicare and Medicaid Services (CMS) instructed all Medicare Administrative Contractors to hold any claims for services paid under the Medicare Physician Fee Schedule with dates of service on or after April 1, 2014, until April 14, 2013. All claims for services delivered on or before March 31, 2014, will be processed and paid under normal procedures.
CMS believes that this hold should have a minimal impact on provider cash flow because, under current law, clean electronic claims are not paid any sooner than 14 calendar days (29 days for paper claims) after the date of receipt.
Update: The President signed the Protecting Access to Medicare Act of 2014 on April 1.
View the alert from CMS here.