SPRINGFIELD, Mo. – A Nixa, Mo. physician was convicted in federal court today after accepting kickbacks from a drugmaker in exchange for prescribing his drug fentanyl to his patients so often that it ranked first in the state in net sales of the product. .
Randall Halley, 65, was sentenced by U.S. District Judge Stephen R. Bough to one year and one day in federal prison without the possibility of parole. The court also ordered Halley to pay Medicare $400,565 in restitution and pay a $150,000 fine.
On December 7, 2021, Halley pleaded guilty to one count of making a false statement to Medicare to obtain insurance coverage for a prescription for fentanyl and to one count of conspiracy to use his DEA registration number to have his employees dispense Schedule II controlled substances to patients in his absence.
Halley, a licensed physician, was employed by Ozark Community Hospital – Christian County Clinic in Nixa from 2004 to June 2019. He was also employed by several skilled nursing facilities and residential care facilities.
According to court documents, Halley was only present at the Nixa office, at most, two days a week, as he was paid to provide care at several area nursing homes and regularly accepted extra money for travel and speak on behalf of pharmaceutical companies. One of the pharmaceutical companies he agreed to speak for was Insys, which produced a fentanyl drug, Subsys, which Medicare only approved for active cancer patients who were currently suffering from acute cancer pain.
Halley accepted bribes from Insys in exchange for prescribing Subsys to her patients. Halley’s participation in the Insys speaker program was a front designed to cover up the bribes Insys paid Halley and other physicians. As long as Halley continued to prescribe Subsys, to increasing numbers of patients and in increasing doses, Insys paid him to speak on their behalf, increasing his compensation over time due to his prescriptions. There was a direct correlation between Insys’ payments to Halley and his Subsys prescriptions issued.
Halley had the highest Subsys net sales of any physician in the state of Missouri and ranked 38th in the United States at one point. In total, Insys paid Halley $92,225 in bribes during their relationship.
The bogus nature of this program was demonstrated by Insys paying him for a program he never attended and calling him a “national” speaker at a higher payout rate despite the fact that he has only traveled outside the state of Missouri twice to speak. Insys, to neighboring Arkansas and Illinois. After Halley failed to attend the program, he signed a sheet claiming that he attended and spoke on the program when, in fact, he had not. This led Insys to pay him $2,400 for the program.
Halley made false statements on pre-approval forms to ensure Medicare coverage of the expensive drug for these patients.
Halley also conspired with her clinic employees to use her registration number so they could provide prescription drugs in her absence. Despite Halley being away from his clinic three days a week, and sometimes longer due to his Insys trip, he asked clinic workers to continue scheduling patient visits on those days. Some of these patient visits were made by clinic employees who could not legally prescribe Schedule II controlled substances. Halley ordered them to write prescriptions several days before these office visits and he would pre-write those prescriptions. Then, when the patient showed up at the clinic for their office visit, the employees conducted the visit and issued the pre-signed prescriptions, all without Halley examining the patient.
Former employees Nga A. Nguyen, 43, and Susan G. Morris, 64, both of Springfield, and Amber N. Moeschler, 39, of Ozark, Mo., have pleaded guilty and are awaiting sentencing for allegedly unlawfully used Halley’s DEA registration number in connection with the distribution of a controlled substance. Former employee Kimberly G. Hoffer, 50, is awaiting trial in December on related charges.
Halley ignored the dangerousness of Subsys. Fentanyl is a highly addictive synthetic opioid that is up to 50 times more potent than heroin. It is a major contributor to fatal and non-fatal overdoses in the United States. The drug is so dangerous that all prescribers and patients who prescribe and receive Subsys must participate in the government-mandated risk assessment and mitigation program, involving education, the prescriber’s contractual commitment to the rules of mandatory prescribing and mandatory patient disclosures.
Many patients were given dangerous fentanyl drugs they didn’t need and weren’t entitled to under Medicare, and Medicare was cheated out of hundreds of thousands of dollars. In her plea agreement, Halley specifically admitted to prescribing Subsys to a patient and submitted a claim to Medicare for prescription payment coverage, falsely stating that the patient was diagnosed with cancer. Halley was aware that the patient had not been diagnosed with cancer at the time and was not being treated for acute cancer-related pain – two conditions required by Medicare for Subsys payment coverage. Due to Halley’s misrepresentation, Medicare paid a total of $11,945 to cover the patient’s prescription and subsequent Subsys prescriptions. Halley engaged in similar conduct with overpayments, which resulted in Medicare paying hundreds of thousands of additional dollars for Subsys prescriptions.
The Drug Enforcement Administration investigated this case with the Department of Health and Human Services, the Office of Inspector General and the FBI.