American Medicine God: Starting by Inheriting a Pharmaceutical Company and Selling Medicine
Chapter 43 Medical Insurance Arbitrage: A Powerful Alliance!
J. Edgar Hoover Building, Washington, D.C.
Fox Mudd sat behind a desk piled high with documents, twirling a pencil in his hand. His gaze was unfocused as he stared at a water stain on the ceiling, a stain that resembled the shape of Roswell, New Mexico.
"Mold, are you listening?"
Blevinsko pierced through Muld's mental barrier.
Mudd stopped twirling her pen, her gaze shifting to the bald man's face. "I'm listening, sir. You're talking about budget cuts and how I wasted three thousand dollars of the department's travel expenses last month on the 'search for a cancer cure' project."
"That's a piece of waste paper, Mulder! We had three top oncologists examine the memo you stole from Water Pharmaceuticals... cough, the memo they all said the chemical formulas on it are nonsense!" Blevins slammed his fist on the table. "You need results, not to spend all day staring at that pharmaceutical company, fantasizing that they're suppressing some miracle cure."
"I've figured it out, that piece of paper is a honey pot, sir," Mulder muttered under his breath. "Victor Corleone is deliberately misleading me. He's hiding something much bigger."
"The truth is, if you don't come up with a decent crime case for me, I'm transferring you to the archives to sort through Vietnam War-era toilet paper purchase orders." Blevins took a deep breath, pointed to the door, and said, "Now, put away that damn 'I Want to Believe' poster. Someone wants to see you."
The door opened.
The person who came in didn't fit in at all.
He wore a plain, dark gray suit, and his white shirt was buttoned up tightly at the collar. He wore frameless glasses and carried a heavy briefcase.
"I'm Miller," the man said. His voice was flat and monotone, like a machine reciting numbers. "I'm from the audit department."
Mulder raised an eyebrow and looked at Blevins. "This is my punishment? An auditor?"
"This is your new partner." Blevins sneered, turned and left. "Have a good time. Miller, show him what the real world is like."
The door closed.
Miller ignored Mulder's scrutiny and walked straight to the messy table. He pushed aside a pile of clippings about "spontaneous human combustion," cleared a clean space, and then opened his briefcase.
"I heard you like looking for 'unexplainable' phenomena," Miller said, pulling out a thick stack of computer printouts. The kind of paper printed by old-fashioned dot matrix printers had serrated edges and was densely covered with numbers.
"If you mean things the government doesn't want us to know, yes." Mulder put his feet up on the table.
"Then you'll like this." Miller pushed the first chart in front of Mudd.
It was a map of the United States. It was covered with a dense array of heat points.
"What is this? A UFO sighting report distribution map?" Mude became interested.
"No. This is the distribution of Medicare and Medicaid reimbursement data for prescription painkillers in the first quarter of 1984." Miller pointed to a bright red dot on the map. "Look here."
Mulder leaned closer to examine it. "The border between Kentucky and West Virginia. The Appalachian Mountains. What's wrong? Do the miners there have back pains?"
"That's Parkville, a mining town with only 20,000 inhabitants."
"But in the past three months, this small town has issued more prescriptions for Class II controlled opioids than the entire Lower Manhattan area of New York City."
Mulder put his foot down. He took the chart, his eyes changing. "Manhattan has millions of people. Parkville only has twenty thousand."
"To be precise, it's 23,412 people," Miller corrected. "That's four hundred times the number of prescriptions per person in Manhattan. Unless there's a localized war there targeting only the spine, that figure is statistically impossible."
"Maybe they're really in pain," Muld shrugged. "Mining is tough work."
"There is a limit to suffering, Mudd. But there is no limit to greed."
Miller pulled out another chart, this time a chart of fund flows. The lines were as complex as blood vessels, but they all eventually converged on a giant heart—Walter Pharmaceuticals.
“I tracked where these drugs went.” Miller pushed up his glasses, the glint of the lenses flashing. “This isn’t just abuse. It’s a perfect financial loop. You see, most of these patients have Medicaid, which means they don’t have to pay a single penny for their medical care and medication; it’s all paid for by the federal government.”
"and then?"
"Then they take these free OxyContin pills, walk out of the clinic, and sell them to drug dealers in the shadows on street corners for $40 a pill, or exchange them directly for heroin." Miller drew a circle on that closed loop with his finger. "The drug dealers then sell these pills to uninsured middle-class addicts, or transport them to big cities."
Mud stared at the cycle and felt a chill run down his spine.
"This isn't just drug trafficking," Mudd muttered to himself. "It's arbitrage."
“Absolutely right.” A hint of approval flashed in Miller’s eyes. “This is ‘Medicare arbitrage.’ It’s like buying gold in London and selling it in New York to make a profit. Except here the commodity is a powerful anesthetic, and the suckers are us taxpayers.”
"What role does Water Pharmaceuticals play in this cycle?" Mudd asked.
"That's the genius part." Miller pulled a brightly colored booklet from the bottom of his briefcase and tossed it on the table.
When Mudd picked it up, he saw a picture of an eagle with outstretched wings on the cover, with the words "Walter Pain Management Pioneer Program" written below.
"They absolve themselves of all responsibility," Miller said coldly. "They're only responsible for manufacturing the drugs, and then selling them to doctors through legitimate pharmaceutical representatives. How doctors prescribe the drugs and how patients use them is 'medical judgment,' not the pharmaceutical company's business. They could even claim to be victims because their drugs have been 'abused.'"
"If that's the case, how do we catch them?" Mude flipped through the booklet, which was full of information about points redemption: a trip for two to Hawaii, a golf club membership card, and even a VIP ticket to a strip club.
"Look at page eighteen," Miller prompted.
Mudd turned to page eighteen. There was a complicated integral formula there.
"I found this in the trash can of a doctor in Kentucky whose license had been revoked," Miller said. "Walter Pharmaceuticals invented a 'points system.' Doctors earned points for every prescription of OxyContin. The higher the dosage, the greater the points. For 80-milligram high-purity tablets, the points could be up to ten times that of regular tablets."
"Isn't this just a kickback?" Mudd frowned.
"It's not just kickbacks. It's incitement to murder." Miller's voice finally softened, a warmth born of anger. "To get tickets to Las Vegas, doctors are prescribing patients large doses they don't need at all. It's called 'titering,' originally used for terminal cancer patients, now being used on miners with only mild back pain."
Mude closed the booklet and slammed it heavily on the table.
“This isn’t medicine, Miller.” Mulder stood up and walked to the wall with the alien poster, looking at the phrase “I WANT TO BELIEVE” on it. “This is money laundering. Except they’re not laundering drug money, they’re laundering tax revenue from the national treasury. This pharmaceutical company has turned drugs into cash equivalents, into the currency circulating in the Appalachian Mountains.”
“I looked into the company’s CEO,” Miller said. “Victor Corleone. Twenty-one years old. He took over the company less than a year ago and increased the stock price fivefold.”
"I know him, he's an old acquaintance of mine. I was investigating him before. I was fooled by him once."
Miller pulled one last document from his bag—an application form. "I'm launching a federal investigation against him. The charges are defrauding the federal government, organized crime, and endangering public health."
"You have no evidence that the points system directly led to the crime," Mulder poured cold water on the idea. "Their lawyers will say it's just normal marketing. Every cereal store gives away toys."
"That's why I came to see you." Miller looked at Mulder with a determined gaze. "You're the best person in the department at finding 'non-existent connections.' I'm in charge of the accounts, proving that the money flow is problematic. You're in charge of proving the 'intent.'"
"intention?"
"It proves that they knew people would die, but they still chose to do it for profit," Miller said. "It proves that the young man named Victor wasn't running a pharmaceutical company, but a huge, legal, state-funded 'pill factory.'"
Mudd was silent for a moment. He looked at the rigid auditor in front of him as if he were seeing him for the first time.
Then, he reached into the pen holder, pulled out a red pen, turned around, and drew a large "X" on the map of the United States, at the border between Kentucky and West Virginia.
"Welcome to the X-Files, Miller." Mulder turned around, a sly smile playing on his lips. "But first, we need to deal with that damn stray dog."
Miller frowned. "What stray dog?"
"The one from Blevins." Mulder grabbed his coat and draped it over his shoulders. "Let's go. We can go to Kentucky on business and fill in 'investigation of unidentified creatures' on the expense report. Anyway, compared to the money Vought Pharmaceuticals stole from the national treasury, this travel expense is nothing."
Miller sighed, put the documents back into his briefcase, and buttoned it up.
“Strictly speaking, that’s embezzlement,” Miller said, following Mulder out the door. “But I can put it on my ‘Special Service Allowance.’ As long as you can prove there really are monsters there.”
"Oh, believe me, Miller," Mulder's voice echoed down the corridor, "there's a monster there a thousand times worse than the Jersey Devil. It doesn't eat meat, it eats money, and it wears an Armani suit."
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