Consumer Health Digest #20-23
Your Weekly Update of News and Reviews
June 14, 2020
Consumer Health Digest is a free weekly e-mail newsletter edited by William M. London, Ed.D., M.P.H., with help from Stephen Barrett, M.D. It summarizes scientific reports; legislative developments; enforcement actions; news reports; Web site evaluations; recommended and nonrecommended books; and other information relevant to consumer protection and consumer decision-making. Its primary focus is on health, but occasionally it includes non-health scams and practical tips.
Trump University lawsuits archived. Credential Watch has archived the key documents from lawsuits against Donald Trump and Trump University, which ran a real estate training program from 2005 until 2010. In 2016, Trump agreed to pay $25 million to settle three lawsuits which charged that he and his associates had misrepresented the nature and value of real estate courses offered by the school. The archive includes depositions, sales scripts, and news reports that spotlight the deceptive conduct. [Barrett S. Lawsuits against Trump University settled. Credential Watch, June 7, 2020]
Telemarketers facing huge fine. On June 9, 2020, the Federal Communications Commission (FCC) proposed a $225 million fine against Texas-based health insurance telemarketers for apparently making more than one billion illegally spoofed robocalls. The FCC news release said the action was the largest proposed fine in the FCC's 86-year history and reflected the seriousness of the apparent violations by John C. Spiller and Jakob A. Mears, who used business names including Rising Eagle and JSquared Telecom. Rising Eagle made approximately one billion spoofed robocalls across the country during the first 4½ months of 2019 on behalf of clients that sell short-term, limited-duration health insurance plans. Mr. Spiller admitted to the US Telecom Industry Traceback Group that he knowingly called consumers on the Do Not Call list as he believed that it was more profitable to target these consumers. The FCC's Enforcement Bureau determined that at one point Rising Eagle used at east 60 spoofed caller IDs and made at least 86,864,456 robocalls to wireless phones as well as 56,635,935 robocalls to numbers listed on the National Do Not Call Registry. The robocalls falsely claimed to offer health insurance plans from well-known health insurance companies such as Aetna, Blue Cross Blue Shield, Cigna, and UnitedHealth Group. The proposed action, formally called a Notice of Apparent Liability for Forfeiture, or NAL, contains only allegations that advise a party on how it has apparently violated the law and may set forth a proposed monetary penalty. Two of the five FCC Commissioners point out in the Notice that the Department of Justice has lessened the agency's effectiveness by failing to help collect fines imposed in previous cases. The FCC's action against this scheme provides some hope that robocalls can be controlled. But it also spotlights why laws are needed to make illegal robocalling a crime that can be punished by imprisonment. [Barrett S. FCC proposes record $225 million fine for massive spoofed robocall campaign. Casewatch. June 10, 2020] More information about robocall regulation is available at: https://www.fcc.gov/spoofed-robocalls.
Chiropractors resolve alleged False Claim Act violations. Tyler and Tiffany Armstrong, who operate the Sioux Center Chiropractic Wellness Center in Iowa, have agreed to pay $30,418 to resolve allegations that they violated the False Claims Act by billing Medicaid for the treatment of conditions for which payment is not allowed, including constipation and ear infections in children ages seven and under. [Sioux Center Chiropractic Clinic to pay $30,418 to resolve allegations related to claims submitted to Medicaid for treatment of children for constipation and ear infections. US Attorney's Office in Northern District of Iowa news release. June 5, 2020] In 2015, an Iowa chiropractor agreed to pay $62,349 to resolve similar allegations. Neither settlement contains an admission of fault. Thousands of chiropractors claim that chiropractic offers an alternative to medical management of childhood disorders. Although such claims are not evidence-based, they rarely attract regulatory attention.
Alleged hucksters of compounded drugs indicted. Mitchell "Chad" Barrett, 54, of Gulf Breeze, Florida, David "Jason" Rutland, 41, of Bolton, Mississippi, and Thomas "Tommy" Shoemaker, 56, of Rayville, Louisiana have been charghed with various schemes to defraud Medicare, TRICARE, and private insurance companies, and their conspiracy to launder the proceeds. Between September 2011 and January 2016, Barrett, Rutland, and Shoemaker allegedly:
- conspired to and engaged in a scheme to defraud numerous health care benefit programs of more than $180 million
- used several pharmacies, including Gluckstadt Special Care Pharmacy and Compounding LLC, World Health Industries Inc., Opus Rx LLC, and Rx Pro Pharmacy and Compounding LLC to fraudulently formulate, dispense, ship, and bill insurance companies for medically unnecessary compounded medications in the form of topical creams and capsules, some of which contained controlled substances
- conspired to and engaged in a scheme to solicit and pay kickbacks and bribes to marketers, physicians, other medical providers, and beneficiaries to refer, prescribe, and receive prescriptions for medically unnecessary compound medications
- conspired to and engaged in a scheme to launder the proceeds of their fraudulent activity by concealing the proceeds they obtained and conducting monetary transactions of a value greater than $10,000, including the purchase of numerous assets, such as real estate, luxury automobiles, a three-carat diamond, and other high-priced goods. [Three charged in $180 million health care fraud and money laundering scheme. U.S. Attorney's Office, Southern District of Mississippi news release. June 12, 2020]
The National Academies of Sciences, Engineering, and Medicine concluded this year that there is limited evidence to support the use of compounded topical pain creams to treat pain conditions in the general adult population.
Funeral homes not disclosing prices as required. Federal Trade Commission (FTC) investigators, working undercover in Georgia, Louisiana, Nevada, New Jersey, and Texas found failures to disclose timely itemized pricing information, as required by the Funeral Rule, in 17 of the 90 funeral homes they have visited since 2018. [FTC releases funeral home compliance results, offers new business guidance on Funeral Rule requirements. FTC press release. June 8, 2020] Consumers should know their rights when planning funerals.
This page was posted on June 14, 2020.