Tougher federal prosecution of health-care fraud

U.S. Attorney Zane David Memeger says "you want to make sure you're sending a signal" on enforcing the law.
U.S. Attorney Zane David Memeger says "you want to make sure you're sending a signal" on enforcing the law. (DAVID MAIALETTI / Staff Photographer)
Posted: January 23, 2012

The United States spends about $2.6 trillion per year on health care, or about 17.4 percent of our gross domestic product - more than most developed nations without correspondingly good results.

The Justice Department has increased prosecution of health-care fraud, which can physically harm patients and fiscally injure taxpayers, against individuals or multinational companies. Philadelphia is a center for that fight because there are many health-care companies in the area.

Zane David Memeger is the U.S. attorney for the Eastern District of Pennsylvania, the local branch of the Justice Department. Memeger graduated from James Madison University and the University of Virginia Law School. He prosecuted cases as an assistant U.S. attorney, then left to work in private practice at Morgan, Lewis & Bockius L.L.P. in Center City. Pharmaceutical companies were among his clients. He returned as U.S. attorney in 2010.

Memeger spoke with Inquirer reporter David Sell about his office's efforts fighting health-care fraud.

Question: How can regular people - patients and taxpayers - help fight health-care fraud?

Zane David Memeger: Patients, doctors, nurses, and people in the health-care industry should be vigilant in terms of billing practices that just don't look right, being charged for procedures or items that aren't consistent with their conditions. They should consider reporting that to the proper authorities, and there are a number of hotlines set up for various agencies, including the Office of the Inspector General of the Department of Health and Human Services. [The number is 1-800-HHS-TIPS or 1-800-447-8477.]

Q: With about eight of the 128 attorneys on staff mostly focusing on health-care fraud and government fraud - there are bank robberies and other crimes to prosecute - how do you decide what health-care cases to pursue?

Memeger: We want to make sure we're doing solid cases. We have to look at the facts and see whether or not there is liability from a civil angle or if there is enough evidence to prove to a jury beyond a reasonable doubt that an individual or a company engaged in criminal conduct, and that is a very high standard. You look at different cases and you might evaluate early on that there is just not enough evidence, so we have to let it go by the wayside. We need to do cases that have a deterrent effect. When dealing with companies, you want to make sure you're sending a signal that you're looking at their conduct and that they need to adjust their conduct to comply with the laws and regulation that apply to their industry, so people aren't harmed. 

Q: Johnson & Johnson, the world's largest health-care company, paid $158 million Thursday to settle a Texas lawsuit regarding charges of illegal promotion of the antipsychotic drug Risperdal. There was a report that J&J reached an agreement with your office to pay $1 billion to settle federal charges for the same drug and activities.

Memeger: I have no comment.

Q: In November and December, four local and former executives from medical-device manufacturer Synthes were sentenced to prison for their role in an illegal and unapproved clinical study of bone cement, which was provided to doctors for use in spinal surgeries, three of which ended in patients dying on the table. It is unusual for health-care executives to go to jail. What was your view of the sentences?

Memeger: This was egregious conduct, and if you make decisions that result in these types of deaths, you need to be held accountable and prison is an effective deterrent, in my view, for the long term. Other executives will see that they need to be on top of their people, that they need to make the right decisions and make sure they are not putting patients at risk unnecessarily.

Q: Pharmaceutical and medical-device companies have been fined billions of dollars for illegally promoting drugs for uses not approved by the U.S. Food and Drug Administration. But there is a perception that fines are simply the cost of doing business and conduct hasn't changed. Until the Synthes cases, if individuals were charged, they usually got probation. Now that you have sent a few to prison, do you think some will resist plea bargains and take their chances before a jury?

Memeger: I'm not sure how that will play out. It is a big risk to just roll the dice and, at the end of day, go to jail. I'm hoping we don't even get to the point where we're talking to individuals about rolling the dice. I hope they are sitting in the boardroom saying, "Those guys at Synthes knew the reports were coming back, knew that patients were dying and they made a decision to go ahead and continue running their study." I hope the executives in the boardroom are saying, "I'm not making that same decision because of what happened there." That would be a good day for us, because then we don't end up investigating and litigating.

The vast majority of people in the industry do things the right way and are not looking to cut corners. There are other people - it's like anything else, a subset - who think cutting corners is OK, and they will run with that risk. We need to catch those people and prosecute them.

Contact staff writer David Sell at 215-854-4506 or, or @phillypharma on Twitter. Read his blog at

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