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New Medicare Fraud Suit Against PharMerica

This week Reuters shared the news that a large pharmaceutical company, PharMerica, was hit by a lawsuit filed by the U.S. government. The suit claims that the company engaged in a series of illegal activities. The allegations suggest that patients lives were put in danger by PharMerica’s actions and significant funds were funneled fraudulently from Medicare as a result.

Whistleblower Comes Forward
The U.S. government lawsuit against PharMerica comes two years after the same allegations were made in a whistleblower lawsuit filed by a former employee of the company. The whistleblower, who worked as a pharmacy operations manager at one company facility, explained how the pharmacy dispensed medication without first getting valid prescriptions from doctors.

The company at the center of the suit, PharMerica, is a sizeable entity which mostly provides medications for senior residents in nursing homes. According to recent reports, over the two year period covered by this government lawsuit, at least 300,000 senior residents were serviced by PharMerica, totaling 40 million annual prescriptions
The complaint filed by the U.S. Government is based on the False Claims Act and Controlled Substances Act, and argues that over at least a two year period, hundred of false claims were made to Medicare for those prescriptions which should never have been given out. The government is seeking “triple damages,” as it is entitled under the law.

The main drugs in question were fentanyl and oxycodone. Those familiar with these medications are aware the dangers they pose when not used properly. If given without cause or in incorrect dosages, use of these ‘Schedule II” drugs can cause real danger to unsuspecting patients.

Federal official allege that company engaged in conduct that bypassed physicians and gave individual nursing home staff members the power to order these powerful drugs for residents. Essentially, staff members would tell the pharmacists to dispense the narcotics and PharMerica employees would comply, even though there were no signed doctor authorizations

In explaining the suit the assistant attorney general involved in the case noted, “Pharmacies are prohibited by law from dispensing Schedule II narcotics, which have the highest potential for abuse of any prescription drug, without a valid prescription from a physician.”

Qui Tam
As this case demonstrates, one of the most critical tools to combat the unlawful intersection of money and poor patient care are whistleblowers. It is often impossible for outside regulators to fully catch misconduct like that which may have occurred here. Instead, we rely on those familiar with the incident to come forward and shed light on unsafe or illegal practices by healthcare providers, from hospitals and pharmaceutical companies to nursing homes and oncology clinics.

Besides ensuring the best for fellow community members, there are also built-in legal incentives for whistleblowers to step forward. “Qui tam” laws exist which allow private individuals to file private lawsuits in these cases. If successful those who come forward are able to seek a percentage of the total funds recouped. In other words, it is one of the rare cases when doing the right thing is a win-win.

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