The indictment and legal proceedings against Ruthia He, the founder and CEO of Done Global, and David Brody, a clinical president of Done and the sole shareholder of Done Health, P.C., are underway in federal court in the Northern District of California. The charges include criminal conspiracy to distribute controlled substances, commit health care fraud, and obstruct justice. This case may bring increased scrutiny to behavioral health telemedicine companies and other virtual health platforms.
The indictment, which is the Department of Justice’s (DOJ’s) first criminal drug distribution prosecution related to telemedicine prescribing, alleges that Done and its affiliated practitioners prescribed over 40 million prescriptions of Adderall and other stimulants for attention deficit hyperactivity disorder (ADHD) during the period from February 2020 to January 2023. The DOJ alleges that Done interfered with the clinical decision-making of the prescribing practitioners, resulting in millions of prescriptions without a legitimate medical purpose.
Done, along with several other telemedicine companies focused on providing behavioral health services, was launched in 2019, immediately prior to the COVID-19 pandemic. The company leveraged telehealth flexibilities and policy changes promulgated by the Department of Health and Human Services and Drug Enforcement Administration (DEA) during the pandemic. Critically, the federal agencies suspended the requirement that physicians and other practitioners could prescribe controlled substances virtually only after an initial in-person patient consultation.
The DOJ alleges that Done violated California’s prohibition against the corporate practice of medicine by inappropriately interfering with the clinical decision-making of the prescribing practitioners. Done allegedly mandated short, non-comprehensive clinical intake forms, instructed practitioners to prescribe Adderall and other stimulants even if not clinically supported, implemented an “auto-refill” policy, and discouraged follow-up patient encounters. Compensation for prescribers was solely based on the number of patients receiving prescriptions, with no payments for initial or follow-up consultations.
The indictment also alleges that Done submitted false prior authorizations, representations, and documents to federal, state, and commercial insurers, resulting in improper reimbursement exceeding $14 million. Additionally, the DOJ alleges that He and Brody engaged in the concealment and destruction of documents in response to media assertions of improprieties at Done and a grand jury subpoena.
Done has publicly stated that it disagrees with the allegations in the indictment and intends to continue operations, including the prescribing of controlled substances. The company’s actions may have significant implications for the telemedicine industry, particularly in terms of maintaining independent clinical decision-making by affiliated practitioners and adhering to applicable standards of care.
The DOJ’s actions may also influence the DEA’s rules related to the use of telemedicine in prescribing controlled substances. Physicians and other clinicians are concerned that limiting pandemic era flexibilities for virtually prescribing controlled substances could limit access to essential medications and disproportionately impact patients in rural areas and marginalized communities.
As the prosecutions and any further enforcement actions continue, it is essential to monitor the developments in this case and their potential impact on the telemedicine industry and virtual health platforms.
