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Ryan O’Neill Provides Insights on Compounded Drugs HIPAA Violations

October 21, 2022

White Collar Criminal Defense and Investigations Partner Ryan L. O’Neill was tapped for DecisionHealth’s Part B News article “Not fine:  Jail threat in compounded drug HIPAA breach serves warning,” published on October 20, 2022.  The article discusses the risk of prison time for doctors who violate HIPAA rules, focusing on the increased scrutiny given to doctors who prescribe compounded drugs.

Ryan comments that, while compounding drugs is legal, “they’re not FDA approved, so you have doctors trying to get familiar with compound pharmacies that can be hard to vet.”  She cautions that it can be difficult to confirm that prescriptions are going to the compound pharmacies the doctors believe they’re going to.  She adds that, because compounds are tailored for individual cases and therefore tend to be expensive, their medical necessity can be hard to explain. Ryan recommends that doctors who are prescribing compounded drugs need to be extra clear as to why they are writing compounding orders. “The decision to prescribe has to be incredibly well-documented,” Ryan said in the article.

Ryan notes that the risk of violations is increased when the office staff of busy doctors “get complacent and allow assistance with paperwork” by the pharmaceutical representatives, causing the relationship between doctor and pharm rep to become problematic as to HIPAA concerns.

While most HIPAA charges lead only to fines and agreements that the offender meet certain oversight targets, by statute a HIPAA violation can result in up to 10 years in prison.  Ryan suggests that criminal HIPAA charges are getting “fresh looks” in part because bringing those charges can be a “tool” for the prosecutor to unearth information in fraud cases, leading to “a lesser charge that might please both defense counsel and the government.”

With permission from DecisionHealth’s “Part B News,” click here for the full article.

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