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Shasta County Physician, Two Pharmacy Operators Arrested for Felony Medi-Cal Fraud

Fatal drug overdoses linked to Medi-Cal fraud case
Thursday, February 18, 1999
Contact: (415) 703-5837

(SACRAMENTO) -Attorney General Bill Lockyer today announced the arrest of Dr. Frank Fisher and pharmacy owners Stephen and Madeline Miller, all of Shasta County, on three counts of murder and other charges involving improper narcotic drug prescriptions that resulted in more than $2 million in Medi-Cal fraud.

The felony criminal charges allege that the Anderson-area physician and pharmacy operators provided the controlled narcotic oxycodone to patients unnecessarily and in potentially lethal doses at high cost to taxpayers. The 27-count complaint was the latest to be filed against the physician. In May 1998, Dr. Fisher was charged with submitting false Medi-Cal claims involving over-prescription of drugs. The earlier complaint has been pending in Shasta County Superior Court.

"We have moved to shut down a medical practice and pharmacy kickback scheme that our investigators found fraudulently billing the state Medi-Cal program over $2 million," Lockyer said. "We are prosecuting what was in fact a highly sophisticated drug-dealing operation. By taking this action, we are shutting down suppliers of a highly addictive drug that has been improperly allowed to saturate the community."

Lockyer said Redding-area emergency rooms have reported increased numbers of patients seeking treatment for drug overdoses. There have been links of these patients to Dr. Fisher and the over-prescribing and over-dispensing scheme. With the supply of prescription narcotics shut down, local physicians are bracing to see more patients with drug addiction problems. Local physicians have asked patients who were receiving treatment for legitimate pain conditions to consult another personal physician or contact the Shasta Trinity Medical Society hotline at (530) 247-7784.

The lawsuit charges Dr. Fisher with prescribing Schedule II and Schedule III controlled drugs without providing good faith medical examinations and without need or medical justification. Investigators found the physician to be running a patient mill with patient examinations typically being cursory at best and lasting no more than a few minutes. Investigators also found that the doctor orchestrated higher billings by changing his status from a "fee-for-service" to "Rural Health Clinic" provider, raising his Medi-Cal reimbursement receipts from approximately $17 to $50 per patient visit.

The felony complaint also alleges that the physician pursued an illegal kickback and referral scheme that directed business to Shasta Pharmacy, owned and operated by the Millers. The scheme facilitated improper drug billings to the Medi-Cal program totaling more than $1 million.

According to 1998 federal Drug Enforcement Administration data, Shasta Pharmacy became the nation's top wholesale buyer of the physician-prescribed drug oxycodone in the state and 10th largest purchaser in the nation. The allegedly improper billings boosted the couple's average monthly income from $52,000 to approximately $250,000. The alleged scheme by the physician and pharmacy resulted in the prescribing, dispensing and furnishing of over 1.5 million milligrams of oxycodone.

According to medical experts, oxycodone is a potent and highly addictive narcotic commonly prescribed to patients suffering from extreme pain associated with end-stage cancer and who generally have developed tolerances to other painkillers.

The murder charges stem from the deaths of Rebecca Mae Williams on August 6, 1998; Bruce Johannsen, Jr. on July 8, 1998, and Tamara Stevens on September 10, 1998. The victims, former patients of Dr. Fisher, were found with lethal doses of oxycodone.

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