Fraudulent Prior Authorizations Lead to Sentencing for HIPAA Violation

The U.S. Attorney’s Office for the District of Massachusetts recently released a statement containing the sentencing details for three former district managers of the pharmaceutical company Warner Chilcott. Landon Eckles of Huntersville, N.C., Timothy Garcia of Los Gatos, CA, and Jeff Podolsky of East Meadow, N.Y. were sentenced due to committing health care fraud and unauthorized use of protected health information (PHI) in accordance with HIPAA.

The osteoporosis division of Warner Chilcott manufacturers the drug, Atelvia®, and prior to that it produced Actonel®. Both medications have had problems with insurance coverage since a generic version was also available. In such cases, doctors were required provide a prior authorization, or written approval, in order for the medication to be covered by insurance.

In order to boost sales, Eckles, Garcia, and Podolsky each encouraged sales representatives within their respective districts to prepare prior authorizations themselves, even in situations where doctors were hesitant or had refused.

As manager of Warner Chilcott’s mid-Atlantic division, Eckles, 30, and his sales reps accessed patient’s PHI and “flagged” patients medical charts with Atelvia® brochures to remind doctors to prescribe the medication. As a result of these efforts, Eckles received a $60,000 bonus from the company in 2011.

Eckles plead guilty to wrongful disclosure of PHI. He received a $10,000 fine and a one-year probation.

Garcia, 35, was a district manager of the San Francisco Bay area. By pushing his sales reps to prepare false prior authorizations, he netted himself a $60,000 bonus and promotion in 2011. It is believed that insurance companies paid Warner Chilcott at least $100,000 based on these fraudulent authorizations.

Now, after pleading guilty to conspiracy to commit health care fraud, Garcia was sentenced to eight months of home confinement and must forfeit $21,500.

Forty-nine year old Podolsky worked for Warner Chilcott’s New York City and Long Island Division. He directed his sales reps to use false clinical information about patients on authorizations for Actonel® and Atelvia® to submit to insurance companies. Doing so, his district became the top-grossing in the country. He received a $100,000 bonus and promotion in 2011. Warner Chilcott is believed to have been paid at least $200,000 by insurance companies based on fake prior authorizations created by Podolsky and team.

Podolsky plead guilty to conspiracy to commit health care fraud. He was sentenced to eight months of home confinement, must forfeit $28,237 and pay a $10,000 fine.

 

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