Pharmacy Alert: Humana Sues Telemedicine Company and Physicians Among Others

On August 20, 2020, Humana Pharmacy Solutions, Inc. (“Humana”) filed a lawsuit alleging, among other things, violations of the Racketeer Influenced and Corrupt Organizations Act (“RICO”) against a Florida-based company, Quivvy Tech Corp., and physicians.  Humana claims that the defendants have been involved in an illegal scheme to fraudulently prescribe and bill unnecessary and highly reimbursable prescription claims to Humana.[1]  Certainly, this case is one that should be closely monitored, as other Pharmacy Benefit Mangers (“PBMs”) may follow the actions taken by Humana.  In the same vein, pharmacy providers must be cognizant of various regulations governing telemedicine as well as applicable Federal and State laws relating to the practice of pharmacy.

In the lawsuit, Humana claims that Quivvy Tech allegedly hired telemarketers to cold-call Humana members and refer them to physicians, who then allegedly prescribed unnecessary and highly reimbursable topical creams using the prescriptions pre-printed prescription forms designed by Quivvy Tech.  Notably, Humana further alleges that physician defendants electronically signed the pre-printed prescriptions without ever having a consultation with the patients.  These prescriptions were then wired, via electronic faxes/e-scripts, to a number of pharmacies who were not named as parties in the suit (allegedly because of arbitration provisions in the contracts between Humana and the pharmacies).  Humana says it paid out between $590,000 and $2.3 million to reimburse drugs prescribed by the six doctors named in the lawsuit, for a total of almost $10 million.  The complaint also targets Frank Michelin, the owner of QuivvyTech and the other telemedicine defendant, Reliable Document Solutions LLC.  It is worth noting that Michelin pled guilty to a charge of securities fraud after accepting a bribe from an undercover agent in 2005 and served just over two years in federal prison. 

How Frier Levitt Can Help

Critically, pre-printed prescription forms require substantial healthcare legal analysis on various issues including, but not limited to, violation of Federal and State laws.  If your pharmacy is currently processing prescriptions, especially pre-printed prescription forms, associated with telemedicine encounters, contact Frier Levitt today to speak to an attorney.  Our Life Sciences team has the tools and experience to assist Pharmacies to mitigate the risks involved with telemedicine arrangements. Contact us today for more information.

 

[1] The case is Humana Pharmacy Solutions, Inc., et al. v. Michelin, et al., Case No. 9:20-cv-81361, in the United States District Court for the Southern District of Florida.

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