Weekend Op-Ed Piece

It is no doubt true that there are many cases in which the criminal could not have known that he was breaking the law, but to admit excuse at all would be to encourage ignorance where the law maker has determined to make men know and obey, and justice to the individual is rightly outweighed by the larger interests on the other side of the scales.

                                                                            Oliver Wendall Holmes

One doesn't need to be a good man to perceive what's lawful, but with that said, what would a week in spine be without more tabloid sensationalism? BNET, the CBS interactive business network reported on Friday, June 3, 2011 that a federal appeals court ruled that the trial judges from the First District Court in Boston have applied the false-claims and anti-kickback statute too strictly. The appellate court's ruling follows a string of seven federal court decisions which had required that conspirators "expressly" acknowledge they are breaking the law when fraudulently applying for reimbursement from the government for medical expenses. Medicare, insurers and healthcare providers would have to find a written confession in order to demonstrate that they were being ripped off.

The ruling in question pertains to a qui tam case involving two former industry employees and Blackstone Medical.  The whistleblowers allege that Blackstone Medical, its corporate officers and management team paid spine surgeons between $1,666 and $8,000 per month to ensure that they use Blackstone implants on their patients.  The defendants argued that the payments were officially used to recruit surgeons for Blackstone's Medical Advisory Board.  The case hinges on proving that these payments were made in return for surgical volume.  All surgeon contracts were signed by Blackstone President Matt Lyons. The smoking gun in the case seems to be e-mails that were sent between a former regional manager, and Vice President of Sales.

The e-mail between the aforementioned manager and VP related to padding more hours for a surgeon advisor. Unless there is a pre-trial settlement, this suit could pit former managers against the executive management team, resulting in choice. Will the parties agree to cooperate or protect a former employer?  Ignorance is no excuse for a lack of jurisprudence.  In order to be vindicated of any culpability the parties in question will have to prove that they didn't know that what they were doing was wrong, or, that the law didn't apply to them. The potential of jail time looms large. The defense of "I was just doing my job" just doesn't cut it. As for the government, it has acted as an amicus curiae, an advisor, a friend of the court. But could there be more than meets the eye?

This week may turn out to be the week that CEO's in the medical device industry, pharma, and nursing homes wake up to the fact that jail time may be awaiting them when their companies are involved in Medicare and Medicaid Fraud.  One could hear the outcry from our bloggers.  "That damn government is at it again, meddling in places that they shouldn't be meddling in." The double standard that exist within the business world is sheer insanity. CEO's and top executives are usually in the position of leadership for the simple fact that they are supposed to lead. Numerous books have been written on this subject. Leadership means taking ownership and responsibility. It means integrity, transparency and honesty, knowing your employees, to name a few traits.  So the question must be asked, how does someone whom is supposed to lead and guide an organization be so unaccountable when things go astray?  There are obvious exceptions to the rule. Usually when a company develops a reputation for questionable business practices one must wonder is it in their DNA, and, who ultimately pays for these transgressions?  Is this a victimless crime? "Ignorantia juris non excusa, Ignorance of the law excuses no one." As William Jennings Bryan once said, "destiny is no matter of chance, it is a matter of choice." There is a fundamental imbalance in the judicial system when someone robbing a gas station for $50 receives a 10 year sentence while some executive goes on to his next venture just because the company can pull out its check book and write a check with many zeros. Save us the outcry, because contrary to popular belief, their are some exceptional CEO's in this industry, unfortunately, it takes a minority to tarnish the reputation of the majority. Defense attorneys will argue that an individual cannot be held criminally accountable, or lose their jobs simply by the virtue of their status. Not when there is a smoking gun.

As people complain of government spending, the escalating cost of entitlement programs like medicare, social security, and unemployment,  it is the alleged actions as mentioned that contribute to the fiscal burden that is placed on the U.S. credit card. The defense that a corporation is a legal entity having its own liabilities and privileges can be argued.  Though not a person, someone must be held accountable for the actions of the corporation.  Without people and their actions would the corporation thrive? Is justice served when a company pays a $46 million dollar fine when it probably earned 10X in profits?  Just look at the current healthcare environment, there have been some companies that have been caught not once, but multiple times.  Some have submitted false claims, marketed drugs that have not been properly tested for their safety and clinical efficacy, and paid kickbacks to doctors. The usually response by a CEO is that they had were not cognizant of what was going on.  Unfortunately, when your signature or signatures are on specific documents, ignorance is no excuse for lack of jurisprudence.  Why would any individual be responsible for running a company if they did not understand the law?

Before everyone starts blaming the government, or the POTUS, or TSB, or the whistleblowers in this case, scrutiny of the spine industry is being driven by those in the rank of file.  People are tired of the games that those on top seem to continue getting away with, while some reap the rewards and discard the collateral damage, as business as usual.  People are not a commodity where you chew them up, and spit them out. It's tough enough getting up every morning, it is even tougher when barriers and obstacles are placed at every step. So as another door closes, another chapter begins. Someone is going to pay the price for some past indiscretions.  This time, maybe $50 million in escrow will not be enough to bail someone out of doing some time, yet, justice must be served, until then, the party continues.

So in the end, maybe there is a lesson to learn in all or this. It takes less energy to be nice to people, than it does to be a prick.  If you treat your fellow man with an ounce of dignity and respect, rather than arrogance and disdain, one of these days the big dog is not going to come back and bite you in the ass. Karma is a bitch.