Drug diversion in the context of controlled substances occupies a major priority of current federal law enforcement. Almost no day goes by without new reports of arrest, DEA search warrants, and charges involving narcotics and other controlled prescription drugs.
What does it mean when someone is accused of diverting drugs? And what should medical providers know to avoid getting on the DEA’s radar? This article attempts to provide a brief overview about current trends in DEA audits and investigations in an effort to offer guidance and to incentivize physicians and pharmacies in the business of prescribing or dispensing controlled substances to question their current compliance levels.
About Dr. Nick Oberheiden
Nick Oberheiden dedicates his practice to the defense of medical providers and health care business owners. Nick has successfully resolved DEA patient file audits, DEA subpoenas, DEA diversion investigations, health care fraud cases for clients across the United States, including but not limited to New York, New Jersey, Pennsylvania, Illinois, Kentucky, Ohio, Washington D.C, Virginia, West Virginia, Oregon, Washington, Arizona, Nevada, Utah, Texas, Louisiana, Missouri, Alabama, North Carolina, South Carolina, and Florida. Doing so, Nick has built a tremendous track record of avoiding jail time, criminal charges, and liability in even the toughest cases.
If you have questions about how to correctly respond to a government inquiry or a pending investigation involving the DEA, the OIG, or the FBI relating to controlled substances—you can speak with Nick directly at 866-Hire-Nick, including on weekends.
Drug Diversion under the Controlled Substances Act
Drug diversion describes the unlawful sharing, selling, or transfer of legally prescribed controlled substances. Importantly, the person who engages in drug diversion obtained the prescription legally from a physician, but then gives the prescription, or parts thereof, illegally, to another person, and thus eliminates the original legitimate medical purpose. Hydrocodone and oxycodone alone are dispensed in excess of 10 billion dosage units annually.
The DEA classifies drug trading and drug selling into (1) receiving prescriptions from friend or relative at 40.5% of all known diversion cases, (2) buying from friend or relative at 9.4%, (3) theft from friend or relative at 3.8%, (4) buying from a drug dealer or other stranger at 4.9%, (5) theft from doctor or pharmacy including armed prescription robberies and pharmacy burglary at 0.7%, (6) prescription abuse from one doctor at 34.0%.
Although few drug diversions ever occur with the knowledge or approval of the prescribing physician, physicians and pharmacies nonetheless have exposure if the government investigators consider the prescriber’s drug diversion precautions inadequate. Examples of exposure:
- Staff Members Have Access to Prescription Pads
- Insufficient Drug Testing to Monitor Patient’s Compliance
- Willful Blindness to Dirty Drug Tests in the Past
- Insufficient Precautions Against Doctor Shopping
- Forged Prescriptions
- Insufficient Interdisciplinary Treatment Components
- Appearance of Being an “Easy” Doctor to Get Prescriptions From
- Acceptance of Private Pay Patients
- Insufficient Enforcement of Drug Prescription Policies
- Theft of Prescription Forms or Actual Prescriptions
Among the controlled substances with the highest street value for diversion purposes are high dosage drugs with rapid effects, in particular narcotics (morphine, hydrocodone, oxycodone, codeine, tramadol), stimulants (amphetamine/ dextroamphetamine, methylphenidate, e.g. Adderall), tranquilizers (alprazolam, clonazepam, lorazepam, e.g. Xanax, Ativan, Klnopin), and sedatives (zolpidem, e.g. Ambien).
Who Investigates Drug Diversion?
Drug diversion is investigated chiefly by the Drug Enforcement Administration (DEA), the Federal Bureau of Investigation (FBI), the Office of Inspector General (OIG), the Internal Revenue Service (IRS), and prosecutors at the Department of Justice (DOJ). The DEA is divided into 22 major field offices spread across the United States and more than 200 domestic locations throughout the U.S., among them:
- DEA Chicago Division (Illinois, Indianapolis, Wisconsin, Minnesota, North Dakota)
- DEA Dallas Division (North Texas, Oklahoma, Tyler, Fort Worth, Lubbock, Amarillo, Oklahoma City, Tulsa, McAlester)
- DEA Denver Division (Denver, Colorado Springs, Grand Junction, Glenwood Springs, Durango, Colorado, Utah, Salt Lake City, St. George, Wyoming, Casper, Cheyenne, Montana, Billings, Missoula)
- DEA Detroit Division (Michigan, Detroit, East Lansing, Saginaw, Marquette, Grand Rapids, Kalamazoo, Ohio, Columbus, Toledo, Cleveland, Dayton, Cincinnati, Youngstown)
- DEA El Paso Division (New Mexico, Albuquerque, Las Cruces, Midland, Alpine)
- DEA Houston Division (covering South Texas, Corpus Christi, Galveston, Del Rio, Waco, San Antonio, Austin, Houston, McAllen, Brownsville, Beaumont, Laredo etc.)
- DEA Los Angeles Division (Nevada, Las Vegas, Reno, Riverside, Orange County, Ventura, Hawaii)
- DEA Louisville Division (Kentucky, Louisville, London, Madisonville, Tennessee, Knoxville, Johnson City, Chattanooga, Nashville, Memphis, West Virginia, Charleston, Clarksburg, Wheeling)
- DEA Miami Division (Pensacola, Panama City, Tallahassee, Gainesville, Orlando, Tampa, Miami, West Palm Beach, Homestead, Port St. Lucie, Titusville, Ft. Myers)
- DEA New Jersey Division (New Jersey, Atlantic City, Camden, Paterson)
- DEA New Orleans Division (Arkansas, Fayetteville, Ft. Smith, Little Rock, Louisiana, Shreveport, Monroe, Baton Rouge, Lafayette, Mississippi, Oxford, Jackson, Hattiesburg, Gulfport, Alabama, Birmingham, Huntsville, Mobile)
- DEA New York Division (New York, Westchester, Long Island, Albany, Syracuse, Plattsburgh, Rochester, Buffalo)
- DEA Philadelphia Division (Pennsylvania, Dover, Harrisburg, Allentown, Scranton, Pittsburgh, Philadelphia)
- DEA Phoenix Division (Phoenix, Tucson, Nogales, Sierra Vista, Yuma, Lake Havasu City)
- DEA San Diego Division (San Diego, Carlsbad, Imperial County, San Ysidro)
- DEA San Francisco Division (Redding, Sacramento, Oakland, Modesto, San Jose, Fresno, Bakersfield, Santa Rosa, San Francisco)
- DEA St. Louis Division (Missouri, Cape Girardeau, Fairview Heights, Jefferson City, Springfield, Kansas, Topeka, Kansas City, Wichita, Garden City, Nebraska, North Platte, Omaha, South Dakota, Sioux Falls, Rapid City, Iowa, Des Moines, Cedar Rapids, Sioux City, Quad Cities)
- DEA Washington D.C. Division (Virginia, Richmond, Norfolk, Hampton, Roanoke, Bristol, Woodstock, Winchester, Maryland, Baltimore, Hagerstown, Salisbury, Washington D.C.)
Penalties for drug diversion are determined under the Controlled Substances Act, 21 U.S.C. 841 et seq., and are classified by schedules of drugs. In general, violations of the Controlled Substances Act carry criminal penalties of up to 10 years of incarceration and heavy financial fines. Anyone acting as a drug distributor outside the authority of 21 U.S.C. 823 (authorized manufacturers and distributors) should visit with an attorney immediately to avoid criminal exposure. Attorney Dr. Nick Oberheiden is available to discuss your concerns, including on weekends, at 866-Hire-Nick.
The Problem of Private Pay (“Cash”) Patients
Likely the biggest red flag in drug diversion investigations are cash patients. Although neither state nor federal law prohibits acceptance of cash from patients lacking health care insurance, when it comes to opioids, narcotics, and other controlled substances, the rules of reality are different.
Cash patients have a reputation for causing diversion. Almost every DEA criminal search warrant relating to opioid prescriptions emphasizes that the physician’s office in question accepts private pay patients to then provide examples from under cover agents of how some of these cash payors are commercially engaged in selling prescriptions. Further, consider, because cash patients have no insurance coverage, they are hesitant or simply unable to obtain expensive x-rays and MRIs or pay for needed physical therapy and pain procedures. By the same token, cash patients tend to be more reluctant to pay for expensive toxicology testing and thus may escape an effective prescription monitoring system.
If your practice has more than 2% cash patients and those patients receive controlled substances from you, you should speak to Nick Oberheiden immediately. The DEA strongly disfavors cash paying patients in the context of narcotics and you need to understand that you are exposing yourself and your license to behaviors that you can’t control. Call today to avoid both, patient abandonment complaints and getting on the DEA’s radar.