Monarch Medical Group, a California-based practice management company, is embroiled in a kickback scheme that could lead to prison time for 21 physicians, according to Medscape.
Here are five things to know:
1. Last week, a California state court charged 21 physicians with accepting kickbacks for patient referrals in a scheme that Monarch Medical Group owners Tanya and Christopher King cooked up. The Kings were charged in the case along with the physicians and two pharmacists. The practice management group allegedly advertised providing physicians with new revenue streams for transdermal pain creams, oral medication dispensing and urine drug-screening, according to the report.
2. The operation allegedly billed workers compensation for $40 million fraudulently and collected in excess of $23 million; the physicians involved made around $2.2 million in kickbacks, according to the report. The kickbacks were called "marketing expenses."
3. The creams involved were not FDA-approved, but the physicians prescribed the cream and shared in the profits, either earning a flat fee or as high as 90 percent of the reimbursement from workers compensation. The physicians were required to sell a quota of the products to participate.
4. Monarch Medical Group also allegedly purchased and repackaged oral pain medications that the physicians dispensed and then Monarch billed for them without disclosing the wholesale price and physicians received a portion of the profits.
5. For the urine drug-test screenings, the King-owned King Medical Management billed insurers for performing the tests on workers compensation patients and physicians received either a flat rate or percentage of the profits for the test and then samples were referred to another lab for testing as well. The King operation allegedly paid $60 for the additional testing and billed insurers up to $700 per tests.