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Harmful Nursing Home Medicaid Fraud – The Dr. Reinstein Example

With the crossing into March, the official deadline for the “sequester” cuts took effect. That means that over the rest of the year a series of automatically spending cuts will hit many different areas of the federal government, ultimately totalling $85 billion this year alone. When discussing health care issues specifically, Medicare faces some smaller reductions but Medicaid is mostly untouched by the sequester. However, that can be somewhat misleading, because steep financial cuts to both program remain on the table for any compromise that might be reached in the coming months between the parties.

For that reason it remains critical for all of us to be vigilant about how funds are spent for these programs. Both Medicare and Medicaid funds are spent in different ways on nursing home care, but Medicaid constitutes the bulk of support for seniors (and others with various disabilities) who need long-term care.

Our attorneys continue to encourage all those with knowledge of fraudulent Medicaid claims to come forward and speak with a legal professional to learn how the law allows citizens to hold those committing these acts accountable.

Chicago Medicaid Fraud
Perhaps the easiest way to understand how this fraud occurs to to discuss one of the most high-profile recent examples in our area. As the Chicago Tribune discussed in a series of articles last November, Dr. Michael J. Reinstein was hit was a significant lawsuit alleging massive Medicaid fraud rooted in unnecessary antipsychotic drug prescriptions. The doctor worked with dozens of Chicago nursing homes, often treating individuals with mental illness. Obviously, as part of his work the doctor prescribed medications to his patients. However, federal officials argue that his prescription choices for patients were not based on their actual needs but the doctor’s own financial incentive.

According to court documents, Dr. Reinstein allegedly engaged in massive fraud in order to prescribe as many doses of a dangerous antipsychotic medication known as clozapine. To provide some perspective, at one point the doctor himself issued more prescriptions for the drug than all physicians in the state of Texas combined.

Did all of the doctor’s patients actually need this drug at those rates? Not at all, according to the lawsuit. Instead, officials claim that Dr. Reinstein prescribed massive amounts of the drug because he was being paid by the pharmaceutical company which created the drug. These kickbacks took various forms, but they were all allegedly done under the assumption that in exchange for support from the company the doctor would continue to use the drug for his patients. This distorted prioritization is explicitly forbidden.

All told, the False Claims Act lawsuit filed against the doctor suggests that over 140,000 individual Medicaid bills were paid to the doctor fraudulently. This is a massive quantity, referring to individual cases where clozapine was given unnecessarily. If found liable, the doctor faces “triple damages.” That means that not only will he have to repay the entire amount paid by Medicaid, but he will have to repay three times that amount as a penalty.

See Other Blog Posts:

Medicaid Waste: Billions Spent on Poor Care

Failing to Blow the Whistle