Massive Medicaid Fraud Exposed in Psychiatric Drugging of Kids in US

May 8th, 2009. By Evelyn Pringle

In letters to Senators Charles Grassley and Herb Kohl, and Representatives Henry Waxman, Bart Stupak, John Dingell and Barney Frank, on May 5, 2009, attorney, Jim Gottstein, the leader of the Law Project for Psychiatric Rights, has exposed massive Medicaid Fraud involved in the prescribing of psychiatric drugs to children in the US.

While working on a lawsuit filed last fall titled, Law Project for Psychiatric Rights v State of Alaska et al, to prohibit the State of Alaska from paying for psychiatric drugs prescribed off-label to children and youth in Alaska, PsychRights conducted an investigation and determined that the vast majority of psychiatric drugs prescribed for uses not approved by the FDA, and paid for by Medicaid, constitute Medicaid fraud.

A tremendous percentage of psychotropic prescriptions to children and youth do not qualify for reimbursement, Mr Gottstein points out in the letters:

“For example, no anti-convulsants masquerading as “mood stabilizers,” such as Depakote or Tegretol, have been approved for pediatric psychiatric use or supported by any of the compendia. However, these drugs, especially Depakote, are routinely paid for by Medicaid without any apparent consideration that the practice has been prohibited by Congress.

“With respect to the second generation neuroleptics, no pediatric use of Seroquel, Zyprexa or Geodon is approved by the FDA or supported by any of the designated compendia. Risperdal is approved for very narrow uses, as is Abilify, but even when prescribed for these indications, they are almost always prescribed concurrently with another drug(s), which is not FDA approved or supported by any of the designated compendia.”

In 2007, through a state Freedom of Information Request, PsychRights found Medicaid was paying approximately $123,000 per month for anticonvulsants prescribed to kids and $288,000 per month on second generation neuroleptics for a “total averaging approximately $411,000 per month in improper Medicaid payments in Alaska alone.”

“Extrapolating this to the entire country,” the letters state, “there is over $2 Billion in Medicaid payments for psychiatric drugs to children and youth that Congress has explicitly prohibited.”

“In truth,” Mr Gottstein notes, “this is the smallest amount because typically two or more of these drugs are administered concurrently, in what is called polypharmacy, none of which has been approved by the FDA for pediatric use or supported by any of the designated compendia.”

PsychRights is asking the Congressmen’s “assistance in stopping these illegal reimbursements.”

“Also, because most current child psychiatrists no longer know how to help children and youth without resort to the drugs, we are suggesting that the savings be used to fund approaches that have been proven to be safe and effective,” the letters request.

In the summary portion of the letter to Senator Grassley, Mr Gottstein, describes the path to child drugging in the US, as well as the harm to children and the financial burden to the public that has followed, by stating in part:

“In the early 1990’s, the drug companies began targeting children and youth for psychiatric drugs beyond the use of stimulants on children diagnosed with Attention Deficit Hyperactivity Disorder (ADHD). As a result, claims to Medicaid for psychiatric drugs prescribed to children and youth has skyrocketed.

“In 2006, the care and treatment for children diagnosed with mental disorders rose to approximately $9 Billion.

“It is hard to come up with an adjective that adequately conveys the horror this is inflicting on America’s children and youth. Suffice it to say that when the country wakes up to the carnage this has caused, it will be recognized as the largest iatrogenic (doctor caused) public health disaster in history.”

In fact, a new government study reports that more money was spent on treating mental disorders in kids in the US in 2006 than for any other medical conditions.

“The fraudulent activities of drug companies in promoting off-label pediatric use of psychiatric drugs … has begun to be exposed, but the psychiatric drugging of America’s children and youth goes on unabated,” Mr Gottstein advises in the letters.

“The scope of harm and complete lack of morality can be analogized to our current economic debacle caused by unrestrained Wall Street greed,” Mr Gottstein says. “It is much worse, here, however, because children’s and youth’s future, health, and even lives, have been sacrificed and continue to be sacrificed on the altar of corporate profits.”

“Children and youth are almost always forced to take these drugs because they are not the ones making the decisions and are generally not allowed to decline them,” the letters point out.

There is good reason for prohibiting the use of these drugs with kids, Mr Gottstein says. “The evidence is overwhelming that the current practice of prescribing these drugs to children and youth is largely ineffective, even counterproductive, and extremely harmful to children,” he told the Congressmen in the letters.

“Frankly, the United States has lost its collective mind in the way it has subjected so many children and youth to these drugs,” he points out. “It is insane to believe that all of these children have mental illnesses.”

The PsychRights lawsuit is seeking declaratory and injunctive relief that Alaskan kids have the right not to be administered psychotropic drugs unless and until: 1. evidence-based psychosocial interventions have been exhausted, 2. rationally anticipated benefits of psychotropic drug treatment outweigh the risks, 3. the person or entity authorizing administration of the drug(s) is fully informed, and 4. close monitoring of, and appropriate means of responding to, treatment emergent effects are in place, and that all children and youth currently receiving such drugs be evaluated and brought into compliance with the above.

The recommendations are based on the CriticalThinkRx Curriculum consisting of a comprehensive review of the scientific evidence regarding the use of psychiatric drugs on children and youth. CriticalThink was funded by a grant from the Attorneys General Consumer and Prescriber Grant Program, out of the multi-state consumer fraud settlement with Pfizer over the off-label marketing of the anticonvulsant Neurontin. David Cohen, PhD, is principle investigator of the CriticalThinkRx Curriculum and Stefan Kruszewski, MD, is the consulting psychiatrist.

Children “need safe, secure, and loving environments, proper discipline, educational and recreational opportunities, socialization, etc,” Mr Gottstein states in the letters and further explains:

“Children in foster care have been taken into custody because they did not live in safe environments. They “act out” as a result of both the situations they were in before the state took custody and they also “act out” as a result of their treatment in foster care. They are not mentally ill; they need assistance in coping with their problems.”

“We must try to end this horror as soon as possible and I am writing to suggest a means to do so,” Mr Gottstein advises.

The CriticalThink Curriculum sets forth proven psychosocial approaches that help children and youth become successes. Rather “than drugs, these children and youth should have access to such programs and the savings from stopping Medicaid payments for uncovered psychotropic drugs should go to such programs,” PsychRights believes.

Copies of the letters were sent to Kathleen Sebelius, Secretary of Health & Human Services, Kerry Weems, Acting Administrator, CMS, and Joyce Branda, Director of the Department of Justice Commercial Litigation Branch (Frauds).

Tags: Medicaid, Medicaid Fraud, Psychiatric Rights

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