[Congressional Record Volume 142, Number 124 (Wednesday, September 11, 1996)]
[Extensions of Remarks]
[Pages E1566-E1568]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 L.A. TIMES EXPOSES PRESCRIPTION FRAUD; H.R. 2839 IS ONE WAY TO REDUCE 
                           ABUSE, SAVE LIVES

                                 ______
                                 

                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                     Wednesday, September 11, 1996

  Mr. STARK. Mr. Speaker, the August 18, 1996 Los Angeles Times 
contained an excellent article on the massive amount of prescription 
drug fraud in our society and the deaths and illnesses it causes.
  Last year, I introduced a bill, H.R. 2839, to encourage a medication 
evaluation and dispensing system which would stop much of the abuse of 
the prescription drug market, save lives, and avoid billions of dollars 
in medical injuries and expense. Last week, I described how the General 
Accounting Office recommends this type of program for the Nation.
  Today, I am entering in the Record the L.A. Times story which 
documents the enormity of the problem and its cost to our society. I 
hope the passage of a bill like H.R. 2839 will be a priority of the 
next Congress.

              [From the Los Angeles Times, Aug. 18, 1996]

                 Prescription Fraud: Abusing the System

                            (By Dan Weikel)

       Millions of pills are being illegally resold on the 
     streets. Some see a double standard in leniency toward 
     doctors and the rich and powerful who overuse drugs.
       Along one massive front of the war on drugs, where fortunes 
     are amassed and lives destroyed, barely a skirmish has been 
     waged.
       Every year, hundreds of millions of prescription pills flow 
     into the nation's illicit drug market, creating a giant 
     cornucopia of painkillers, stimulants and tranquilizers. They 
     are believed to be among the most abused substances in the 
     country, even rivaling the estimated use of cocaine and 
     crack.
       But in California and elsewhere, only a few agents, often 
     equipped with the most lenient narcotics laws, investigate 
     the illegal trafficking of powerful pharmaceutical by doctors 
     and others. In this backwater of enforcement, recognition 
     comes hard and frustrations abound.
       ``There is just no glory in it--no guns, no piles of coke, 
     and no bundles of cash to stack up for the TV cameras.'' said 
     Special Agent Walter Allen III of the state Bureau of 
     Narcotic Enforcement, who supervises prescription fraud 
     cases.
       It seems the only time prescription drug abuse gets serious 
     attention is when a celebrity tumbles--be it Betty Ford, 
     Elizabeth Taylor or superstar producer Don Simpson, who died 
     of an overdose in January from a lethal mix of cocaine and 20 
     prescription drugs.
       In an extraordinary effort, authorities from local, state 
     and federal law enforcement agencies are investigating more 
     than a dozen doctors suspected of unlawfully supply 
     prescription drugs to the producer of such hits as ``48 
     Hours,'' ``Top Gun'' and ``Beverly Hills Cop.''
       On Friday, the offices of two of those doctors, both 
     psychiatrists, were raided by investigators. The home of one 
     also was searched.
       ``Abuse of prescription drugs is a serious problem in our 
     society, but nobody pays attention until somebody big and 
     powerful like Don Simpson drops dead,'' said Steve Simmons, 
     the California Medical Board's senior investigator on the 
     case. ``But this kind of thing happens all the time to lots 
     of regular folks.''
       Even when law enforcement resources are marshaled, the 
     returns often are small. No more than two dozen doctors, 
     dentists and pharmacists are prosecuted annually for 
     prescription drug offenses, case records show. Most get 
     probation and stay in practice, largely because it is harder 
     to prosecute a professional in a white coat than a street-
     corner pusher.
       In California, about three of four physicians convicted of 
     a prescription drug crime keep their licenses. Users often do 
     more time in jail.
       ``There are two kinds of justice in this system,'' said 
     former state narcotics agent Paul K. King, who worked on 
     prescription fraud in Los Angeles County for 10 years. ``One 
     for doctors, and one for everybody else.''
       Take the case of Dr. Eric C. Tucker, whom state narcotics 
     authorities suspected of illegal trafficking after 
     scrutinizing prescription records.
       Before his arrest in 1991, court records show, Tucker 
     issued more than 7,000 questionable prescriptions for the 
     stimulant Preludin and another 7,600 for Dilaudid, so-called 
     drugstore heroin, an addictive pain reliever that fetches up 
     to $100 a pill on the street.
       More Dilaudid was coming out of Tucker's Montebello office 
     every year than at County-USC Medical Center, the West 
     Coast's largest public hospital.
       Tucker, than 59, pleaded guilty to two felony counts of 
     prescription fraud and lost his medical license. Although 
     responsible for flooding the illegal market with hundreds of 
     thousands, if not millions, of dangerous pills, he was 
     sentenced to eight days in jail.
       In contrast, Daniel G. Siemianowski, 38, of Los Angeles, a 
     low-level street dealer and first-time offender, was 
     prosecuted about the same time as Tucker. Police arrested him 
     with about four ounces of crack and powder cocaine on the 
     front seat of his car--a speck compared to the doctor's 
     goods. Siemianowski's sentence: a year behind bars.
       About 2.6 million people in the United States use 
     prescription painkillers, stimulants, tranquilizers and 
     sedatives for ``nonmedical reasons''--more than the estimated 
     use of heroin, crack and cocaine, according to surveys by the 
     National Institute of Drug Abuse. Only marijuana is more 
     popular.
       Users run the gamut from street addicts to senior citizens 
     who mix afternoon cocktails

[[Page E1567]]

     of tranquilizers, and even teenagers who sell their doses of 
     Ritalin to classmates.
       Some combine prescription drugs with illicit narcotics to 
     enhance the high. Others use tranquilizers to soften the 
     crash from cocaine and heroin, helping them sustain their 
     habits. For many others, pharmaceuticals simply are their 
     drugs of choice.
       Sandra K. Bauer, a member of the California Board of 
     Pharmacy, knows how easy it is to fall to prescription 
     drugs--and how complacent regulatory and law enforcement 
     agencies sometimes can be in searching out the truth.
       In 1990, before Bauer joined the board, her 34-year-old 
     sister collapsed after injecting three times the lethal 
     amount of Demerol--synthetic morphine. Although the coroner 
     found needle marks on her arms and thighs, police had 
     accepted her husband's explanation that she had suffered from 
     terminal cancer.
       ``I told him that was ridiculous,'' Bauer recalled of her 
     conversation with the detective. ``There was no cancer.''
       Bauer insisted that authorities take anotyher look because 
     her sister was a drug addict. During a search of her sister's 
     home, police discovered shelves full of syringes, 
     tranquilizers and potent painkillers.
       ``It was classic middle-class drug abuse,'' Bauer said. 
     ``You go to a doctor and get a bogus prescription. Then you 
     get the pharmacy to fill it, and have your insurance company 
     pay for it all. No one suspects anything.''
       To ensure a thorough investigation of her sister's death, 
     Bauer lobbied state legislators, high-ranking law enforcement 
     officials, journalists and officials on the state pharmacy 
     and medical boards. As a result, two doctors and two 
     pharmacists lost their licenses.
       ``Had I not intervened, my sister simply would have been 
     buried--end of story,'' she said.
       Even then, Bauer did not back off. Through a friend who was 
     the appointments secretary for then-Assembly Speaker Willie 
     Brown, she maneuvered her way onto the state pharmacy board 
     in 1992. Bauer has been working ever since to improve 
     professional discipline and the state's obsolete system of 
     monitoring prescription drugs.


                            enormous profits

       The U.S. Drug Enforcement Administration has estimated that 
     about $25 billion in prescription drugs were sold on the 
     illicit street market in 1993, compared to a government 
     estimate of $31 billion spent that year on cocaine, including 
     crack.
       What makes pills so attractive to abusers and purveyors are 
     their purity, predictable effect and low cost compared to 
     illicit drugs. For about $10, less than the price of a few 
     rocks of crack, a user can combine two or three times the 
     therapeutic dose of codeine with the sedative glutethimide to 
     achieve a high similar to heroin.
       Although some of the drugs are smuggled into the country or 
     stolen from distributors, a large portion comes from medical 
     offices and pharmacies.
       State and federal law prohibits the dispensing of 
     controlled substances unless good-faith medical exams are 
     performed, accepted prescribing practices are followed, and 
     there is adequate medical justification. It also is illegal 
     for someone to fraudulently obtain prescription drugs, a 
     practice known as doctor-shopping.
       By American Medical Assn. estimates, 1% to 1.5% of 
     physicians dishonestly prescribe drugs, and another 5% are 
     grossly negligent in their prescribing. In California, that 
     represents 4,500 to 4,875 doctors.
       For the unscrupulous professional, the profits can be 
     enormous. Doctors, dentists and pharmacists have made 
     millions by turning their practices into lucrative pill 
     mills, where fraudulent prescriptions--written in minutes--
     have sold for $200 to $600 apiece, depending on the 
     substance.
       Working at the other end of the spectrum are doctor-
     shoppers, who trick physicians and pharmacists with self-
     inflicted injuries, forged prescriptions and stories about 
     back pain or old war wounds.
       During an eight-month period in 1990, Vicki J. Renaldo of 
     Oceanside duped 42 San Diego area doctors and 26 pharmacies 
     into giving her thousands of codeine tablets--all paid for by 
     Medi-Cal. She was convicted and sentenced to two years in 
     state prison.
       Another doctor-shopper in the Midwest managed to scam 134 
     physicians.
       ``It's so easy to do. The doctors don't really question 
     you,'' said Barbara Curtis, 42, a member of Benzodiazepines 
     Anonymous, a Los Angeles-based support group for prescription 
     drug addicts. For almost 20 years, Curtis went to three or 
     four doctors to secure supplies of two painkillers--Vicoden 
     and Fiorinal with codeine.
       ``Migraine headaches was all I had to say.''
       ``There seems to be a constant supply of these drugs on the 
     black market,'' said Dr. Greg N. Haynor of the Haight Ashbury 
     Free Clinic in San Francisco, one of the nation's leading 
     drug treatment centers. ``The fact is, a lot of pills are 
     floating around out there that can pack quite a wallop.''
       Depending on the year, a quarter to a half of emergency 
     room admissions related to drug abuse involve a prescription 
     drug either taken by itself or in combination with alcohol or 
     other controlled substances, according to the national Drug 
     Abuse Warning Network.
       The network surveys emergency rooms in 43 metropolitan 
     areas to measure the consequences of drug use. It does not 
     determine whether the prescription drugs were obtained 
     illegally.
       Of the top 20 drugs mentioned in the emergency room 
     episodes, about 75% were prescription painkillers, sedatives, 
     stimulants and tranquilizers.
       Despite the enormity of the problem, prescription drug 
     abuse remains a low priority for law enforcement, which has 
     had its hands full fighting illicit drugs at home and abroad.
       Building a prescription prosecution can take months, 
     sometimes years, of tedious work. Pharmacy records must be 
     scrutinized, and undercover buys must show conclusively that 
     drugs were prescribed without good-faith exams or medical 
     justification.
       Because of the lengthy investigations and a shortage of 
     agents, no more than 20 doctors, dentists and pharmacists a 
     year are prosecuted criminally in California for prescription 
     drug offenses. Federal authorities, on average, convict 240 
     people a year for federal drug-diversion offenses, or about 
     five per state.
       Even when charges are filed, however, juries balk at 
     returning convictions. When they do, the sentences often are 
     short.


                              lenient laws

       Part of the reason, according to law enforcement officials, 
     is that medical practitioners usually are charged under laws 
     that can be filed either as a misdemeanor punishable by no 
     more than a year in jail, or as a low-grade felony, which 
     carries a penalty of 16 months to three years in prison.
       The way the laws are written, prosecutors say, health care 
     professionals can escape more serious drug-trafficking 
     charges if they have written a prescription, no matter how 
     fraudulent.
       Assistant U.S. Atty. Alka Sagar said she has handled about 
     10 prescription fraud cases in federal court in Los Angeles 
     since 1990. Of those, she said, one doctor received a short 
     prison sentence; the rest pleaded guilty and were placed on 
     probation.
       Although felony convictions for prescription fraud are 
     considered easier to obtain in federal court than in state 
     court, the penalties can be just as light because sentencing 
     guidelines are geared almost exclusively toward street drugs.
       ``You could make a series of undercover buys for 60 pills 
     each and the sentencing range would be zero to six months. 
     Even if each buy was 100 times that amount, it would still be 
     zero to six months,'' Sagar said. ``You'd have to raid a drug 
     factory to get a tough sentence.''
       In California, few police departments, even in major cities 
     such as Los Angeles, have specialized officers or anyone with 
     training in prescription drug abuse. The same holds true 
     elsewhere in the nation.
       Responsibility for investigating pharmaceutical abuse in 
     California usually rests with the state's Bureau of Narcotic 
     Enforcement. But, of the agency's 300 officers, about seven 
     are assigned the task, and they sometimes are burdened with 
     other assignments. Prescription drugs also represent a 
     fraction of investigations by state Medi-Cal fraud units and 
     professional boards.
       Nationally, the federal government spends $13 billion to 
     $14 billion annually on the war on drugs. But only $70 
     million goes to the DEA to investigate prescription drug 
     offenses--a small fraction of the agency's billion-dollar 
     budget--and part of that is earmarked to halt the illegal 
     flow of chemicals to clandestine labs.
       Making enforcement even harder is that the state's 
     computerized tracking system for the sale of controlled 
     substances is obsolete. Because data has to be entered by 
     hand, the unit can analyze only 10% to 15% of the 1.5 million 
     controlled substance prescriptions forwarded annually.
       Former state narcotics officer Paul King, who recently 
     retired, recalled a frustrating incident that he says 
     reflects a prevailing attitude toward pill fraud.
       King said he learned in 1988 that federal officers in Ohio 
     had arrested a drug runner as he got off a plane from Los 
     Angeles International Airport with at least $600,000 worth of 
     Dilaudid in a shoe box--12,000 pills.
       At the time, the heroin-like drug was pouring into the 
     illicit market in Los Angeles and then to destinations 
     nationwide. To King's dismay, federal agents wanted to use 
     the courier as an informant for a standard cocaine case, 
     torpedoing any investigation of the Dilaudid shipment, which 
     was as valuable as 40 to 50 kilograms of wholesale cocaine.
       ``You couldn't put $600,000 of any other drug that I'm 
     aware of in a shoe box, and this guy was carrying it in plain 
     sight,'' King said. ``I later found out that the courier 
     wasn't even prosecuted.''


                             SUCCESSES RARE

       Although there have been some successful crackdowns, 
     critics say those have been few and far between.
       During the mid- to late-1980s, state and federal 
     authorities prosecuted more than 34 doctors, pharmacists and 
     runners during Operation Rx, one of the largest raids on pill 
     mills in Los Angeles. Also during the '80s, the powerful 
     sedative Quaalude was virtually eliminated as a problem by 
     regulatory and law enforcement action.
       Still, for the most part, prosecutors are reluctant to file 
     charges in prescription fraud cases because they believe that 
     their limited resources are better spent fighting street 
     drugs.
       It is against this backdrop that comedian Chevy Chase 
     managed to stay out of serious

[[Page E1568]]

     trouble in 1994. For some time, the former star of ``Saturday 
     Night Live'' has had a problem with painkillers, which he 
     says he first took for back injuries caused by pratfalls.
       State narcotics officials spent almost a year compiling 
     prescription records on Chase, whom they suspected of 
     illegally obtaining the potent painkillers Percocet and 
     Percodan from numerous doctors. His Pacific Palisades home 
     was searched, as were several physicians' offices.
       Agents believed the evidence showed that Chase had engaged 
     in unlawful doctor-shopping and recommended that charges be 
     filed by the Los Angeles County district attorney's office. 
     But that's as far as it went; prosecutors considered the case 
     unwinnable.
       Explaining his decision not to file charges against Chase, 
     Deputy Dist. Atty. John Lynch said not only was the doctor-
     shopping law vague, but it was unclear whether Chase had 
     committed any fraud as defined by the statute.
       Los Angeles attorney Zia F. Modabber, a spokesman for 
     Chase, declined to comment because of pending litigation 
     brought against the comedian by a former chauffeur. The 
     driver contends that he has been unable to get work since he 
     was caught by police in 1994 while allegedly ferrying 
     painkillers into Canada for Chase. The judge has restricted 
     public discussion of that case, which is nearing trial.
       ``I think it would be inappropriate to discuss the 
     issues,'' Modabber said, ``not because we have anything to 
     hide, but out of respect for the justice system.''


                          a slap on the wrist

       Disciplinary records from state pharmacy and medical boards 
     also raise questions about the resolve of regulatory agencies 
     to get tough with those who violate criminal and professional 
     codes.
       From 1990 to 1995, the state medical board disciplined 
     about 120 physicians for drug-related matters, 44 of whom 
     were convicted of drug crimes. The pharmacy board disciplined 
     about 160 people. The dental board disciplined 20.
       One in four pharmacists or pharmacy owners, one in four 
     dentists, and one in nine physicians lost their licenses 
     after charges were sustained. Some of the cases included 
     minor offenses for which license revocations would seem 
     inappropriate.
       But even when physicians were found guilty of criminal 
     offenses, including felonies, three out of four kept their 
     licenses. One of them was Dr. Jovencio L. Raneses, formerly 
     of Anaheim Hills.
       In 1990, Raneses agreed to plead guilty to one felony count 
     of illegally prescribing controlled substances. He was 
     sentenced to one day in jail and three years probation. Four 
     felony counts were dismissed.
       Case records show that Raneses issued thousands of 
     fraudulent prescriptions for Dilaudid through a bogus 
     treatment program for back pain. Authorities estimated that 
     the scheme netted a minimum of $400,000 from January 1988 to 
     April 1989.
       Despite the scale of the operation, the state medical board 
     decided in December 1993 to suspend Raneses' license for two 
     months and place him on eight years professional probation.
       Back in 1984, the board first warned Raneses about his 
     prescribing practices and ordered him to take medical 
     courses. Court records show that he never took the classes, 
     and the state never checked to see if he did.
       Such examples have prompted allegations over the years that 
     the medical board, as well as other regulatory agencies, have 
     done little to rid their professions of the worst offenders.
       Medical and pharmacy board officials acknowledge that there 
     have been some problems with professional discipline, but say 
     that reforms have been made since the early 1990s when the 
     criticisms were at their height.
       Records show that more complaints are being investigated 
     and more people disciplined because of streamlined 
     procedures.
       Laws now require the automatic suspensions of medical, 
     dental and pharmacy licenses for someone convicted of a 
     felony. In addition, investigators say, they are seeking more 
     court orders to suspend medical licenses after a person is 
     arrested.
       ``There have been some improvements,'' said John Lancara, 
     chief of enforcement for the state medical board, who was 
     hired in the early 1990s to help overhaul the disciplinary 
     system. ``Our goal is to vigorously enforce the Medical 
     Practices Act.''
       Meanwhile, at the pharmacy board, backlogs of cases--some 
     of which had lingered for 10 years--have been eliminated. 
     More records are being computerized, and fines that went 
     unpaid for years are being collected.
       Board member Bauer argues, however, that there is plenty of 
     room for improvement. She compares the public attitude toward 
     prescription drug abuse to that surrounding drunk driving 
     before a grass-roots movement resulted in stronger laws.
       ``No one really sees this as a crime,'' she said. ``To me, 
     what is this if not a crime? We need to change people's 
     attitudes. There is a need to say, `This is a problem.'''

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