Billing Medicare for Free Samples Can Land Healthcare Providers in Hot Water

It’s not unusual for physicians to receive free samples to give to their patients. But billing the federal government for them is a definite no-no as one St. Louis, Missouri neurologist recently learned.

According to a recent news release from the U.S. Department of Justice, Dr. Sherry X. Ma and her clinic, AIMA Neurology, LLC, agreed to pay $291,288 to settle claims that Ma fraudulently billed Medicare for Botox® and Myobloc® injections.

It was alleged that Dr. Ma received vials of the drugs at no charge to be used for specific patients with health insurance. However, after using a portion of the Botox® and Myobloc®, instead of throwing the remainder away, it was alleged she kept and stored the leftovers for use on Medicare patients and subsequently submitted claims for payment as if she had purchased the vials.

An investigation determined that medical records for certain Medicare patients were false because they contained incorrect lot numbers of the vials used in treating those patients.

The Prescription Drug Marketing Act of 1987 makes it illegal to sell, purchase or trade prescription drug samples. The act requires that drug manufacturers and distributors maintain records of the samples they distribute.

Section 6004 of the Physician Payment Sunshine Act, which is part of the Affordable Care Act, requires manufacturers to disclose certain data to the FDA regarding drug samples requested and provided to licensed providers. In its draft guidance, the FDA noted that while Section 6004 is not part of the Prescription Drug Marketing Act and Section, it “must be read together with that act.”

The Medicare program is no stranger to pharmaceutical fraud. In a majority of cases, however, the fraud has involved pharmaceutical companies engaging in pricing, billing and marketing schemes in violation of state and federal False Claims Act and Anti-Kickback statute violations. Since its inception in March 2007, the Medicare Fraud Strike Force, which operates in nine cities across the country including Miami, has charged nearly 3,000 defendants who have collectively billed the Medicare program for more than $11 billion.

Physicians who receive free samples would be well advised to establish a system designed to ensure that they remain just that, free, and that neither patients, nor insurers are billed.

The Health Law Offices of Anthony C. Vitale can help you to create compliance protocols for dispensing medication samples. Contact us for additional information at 305-358-4500 or send us an email to and let’s discuss how we might be able to assist you.

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The Health Law Offices of Anthony C. Vitale

The Health Law Offices of Anthony C. Vitale