The recent DOJ indictment of DONE, a prominent provider of adderall, marks a significant escalation by the Department of Justice in targeting Telehealth practices and controlled substance distribution. This prosecution is controversial due to several factors. The Ryan Haight Act, which mandated an in-person visit before prescribing controlled substances, was waived during the COVID-19 pandemic. Since the waiver, the DEA has delayed issuing guidance on in-person visits, allowing telehealth platforms like DONE to operate without clear regulations. The DOJ’s charges against DONE are based on the alleged overutilization of adderall, not the Telehealth model itself. Additionally, the indictment introduces the novel legal issue of the (CPOM)”corporate practice of medicine,” highlighting the risks Telemedicine companies face under state laws prohibiting corporate influence on medical decisions.
The charges include allegations that Ruthia He, the founder of DONE, and David Brody, the company’s clinical president, were involved in a $100 million scheme to provide “easy access” to adderall and other stimulants, submitting false claims and obstructing justice. The Justice Department is reaching broadly and asking for medical professionals who were involved in the illegal activity to report via the DEA hotline. In this article, we aim to educate healthcare professionals on the implications of this indictment and offer guidance on staying compliant with current laws and regulations.
DONE, founded two years ago, is a digital health platform that provides Telehealth services, specifically focusing on mental health and ADHD treatment. The company offers online consultations and prescription services, including medications like adderall. Founded with the aim of increasing accessibility to mental health care, DONE uses technology to connect patients with healthcare providers remotely. This model allows for more convenient access to treatment, particularly during the COVID-19 pandemic when in-person visits were limited.
The Ryan Haight Online Pharmacy Consumer Protection Act, enacted in 2008, was designed to combat the illegal distribution of controlled substances over the internet. The Act requires:
An in-person medical evaluation before prescribing controlled substances.
Registration of online pharmacies with the DEA.
Increased penalties for illegal online distribution of controlled substances.
During the COVID-19 pandemic, the requirement for an in-person visit was temporarily waived to ensure continued access to necessary medications while reducing the risk of virus transmission. This waiver allowed telehealth platforms to prescribe controlled substances without an initial in-person consultation.
The DOJ’s decision to prosecute DONE has sparked significant controversy. The Ryan Haight Act, which requires an in-person visit before prescribing controlled substances, was waived during the COVID-19 pandemic to ensure patients continued receiving necessary medications. In the wake of this waiver, many Telehealth companies, including those offering adderall and testosterone, began providing services without the traditional in-person consultations. Despite these operations, the DEA did not issue clear guidelines or take immediate action against these companies. Instead, the DOJ chose to pursue charges against DONE, not for the Telemedicine model itself, but because it allegedly led to the overutilization of adderall by providers.
Furthermore, the indictment includes allegations related to the “corporate practice of medicine.” This legal doctrine, which varies by state, restricts corporations from practicing medicine or influencing medical decisions made by licensed healthcare providers. By the DOJ targeting DONE under this doctrine, this emphasizes the broader risks venture capital-backed Telemedicine firms face in navigating state laws that prohibit corporate influence on medical decisions.
State laws vary in their interpretation and enforcement of the corporate practice of medicine. Some states strictly prohibit corporations from practicing medicine or interfering in medical decision-making, while others are more lenient. Venture capital-backed Telemedicine companies are now under increased scrutiny to ensure they do not violate these state laws. Although insurance companies are often exempt from these restrictions, Telemedicine platforms do not enjoy the same leniency.
Healthcare professionals involved in Telehealth and controlled substance distribution must take proactive steps to ensure compliance. Immediate compliance reviews are essential to ensure adherence to all applicable laws and regulations. Additionally, continuous monitoring of prescribing practices and patient care is crucial to avoid potential legal pitfalls.
Seeking the counsel of a healthcare defense attorney who specifically understands regulatory compliance law is an essential part of developing and maintaining a thorough compliance program. Actionable items every compliance program should cover include:
Internal Audits: Periodically assess operations to identify and correct compliance issues, ensuring ongoing adherence to laws.
Corrective Action Plans: Implement measures to address and rectify compliance shortcomings, continuously improving the compliance process.
Documentation Practices: Ensure meticulous record-keeping to support compliance efforts and facilitate audits.
Individuals depicted or heard in the foregoing media appearance or images may no longer be current attorneys, employees, members or affiliates with Chapman & Associates, PC or The Chapman Law Group (the “Firm”), including Ronald W. Chapman, II who is no longer affiliated with the Firm. For a current listing of the attorneys and services available with the Chapman Law Group, please see
https://chapmanlawgroup.com/team.
If healthcare providers suspect they have violated laws related to Telehealth and controlled substance distribution, immediate actions are necessary to mitigate potential legal consequences. Key steps include:
Consult Legal Counsel: Seek advice from a healthcare fraud defense attorney to understand the legal implications and develop a strategic response.
Conduct an Internal Investigation: Thoroughly review internal practices and records to identify the extent of the violation and gather relevant evidence.
Cooperate with Authorities: Cooperate with regulatory bodies or law enforcement only under the guidance of legal counsel to ensure that your actions do not inadvertently increase legal exposure. This cooperation, if done correctly demonstrates a good faith effort in resolving the issue.
Implement Corrective Actions: Address identified deficiencies promptly and implement corrective measures to prevent future violations.
We hope this article brought you value, and key insight on how the recent DOJ indictment of DONE serves as a stark reminder of the ever evolving regulatory landscape surrounding Telehealth and controlled substance distribution. Healthcare professionals must stay vigilant and proactive in ensuring compliance with all applicable laws and regulations, both federal and state, to protect themselves from legal risks. If you are a healthcare provider and find that you need to review the compliance of your practice, or that maybe you’re worried that you accidentally weren’t following regulations, give us a call today or reach out via our contact form to schedule a free consultation. A dedicated healthcare defense attorney will evaluate your matter and guide you on your next steps to a more secure tomorrow.
"*" indicates required fields
Los Angeles Office
17434 Bellflower Blvd., Ste. 200-229
Bellflower, CA 90706
Phone: (248) 644-6326
Miami Office
701 Waterford Way, Suite 340
Miami, FL 33126
Phone: (305) 712-7177
CMS contractor found an ophthalmology practice liable for a $444k overpayment. A successful Level 2 Reconsideration turned the tables on CMS.
Faced with two counts of Unlawful Distribution Causing Death, among other charges, the White Collar Defense team cleared the hefty charges without any additional jail time.
Michigan faced RICO charges for billing unrendered services, but our healthcare attorneys argued that the amount billed in error was exaggerated by the prosecution.
