A physician who operated an alleged “pill mill” out of a downtown Riverside office from 2013-16 faces the prospect of prison after a jury convicted him on all 11 counts in a federal medical insurance fraud case.
Dr. Paul C. Madison, 65, was convicted on six counts of health care fraud, three counts of making false statements in connection with the delivery of health care services and two counts of aggravated identity theft on Nov. 29 in U.S. District Court in Chicago.
He faces up to 10 years in federal prison for each count of heath care fraud and up to five years for each count of making false statements. The identity theft counts carry mandatory consecutive sentences of two years each.
Judge Robert M. Dow has set sentencing for March 25, 2019.
The case is not related to Madison’s office in Riverside. Rather, the suit stemmed from actions that took place between 2005 and 2009 at his outpatient surgical center in Water Tower Place on North Michigan Avenue.
He and a nurse who worked at Watertower Surgicenter LLC were indicted by a federal grand jury of fraudulently billing insurance companies for some $3.5 million in medical claims. Prosecutors charged that insurance companies lost a collective $783,000 as a result of the fraud.
The charges against Madison’s nurse were dropped in 2014 in exchange for her cooperation with prosecutors.
During the trial, which began Nov. 7, prosecutors charged that Madison ordered his employees to submit false bills to insurance companies for a chiropractic procedure called manipulation-under-anesthesia that chiropractors at Watertower Surgicenter had not performed. Part of that scheme included Madison directing employees to falsify patient records to support the fraudulent insurance claims.
Madison’s legal troubles are not over. He and two other doctors are named in a series of lawsuits being filed by municipalities and other entities in Illinois to recoup costs related to the national opioid epidemic that is being blamed in part on pill mills like Riverside Pain Management, which Madison operated in downtown Riverside. Also named in those suits are Dr. William McMahon and Dr. Joseph Giacchino, a disgraced former physician who served as the Riverside clinic’s “administrator.”
Giacchino had his medical license revoked by the state of Illinois in 2011 for improperly prescribing controlled substances and providing medications to female patients in exchange for sex.
Both McMahon and Madison had their Illinois medical licenses suspended in late 2016. Giacchino tried to keep the Riverside clinic running by hiring other physicians who were still able to prescribe medications, but the operation closed down in March 2017.
Meanwhile, Madison remains an unindicted co-conspirator in a federal case filed in 2016 against the executives of the Massachusetts-based drug company Insys Therapeutics.
The firm is accused by the U.S Attorney’s Office of playing a role in a “nationwide conspiracy to profit by using bribes and fraud to cause the illegal distribution of a Fentanyl spray intended for cancer patients experiencing breakthrough pain.”
The company is accused of paying doctors, including Madison, to host sham speaking engagements in exchange for prescribing their powerful fentanyl spray. Madison was allegedly paid $87,000 to participate in the program and was accused by federal prosecutors of aggressively prescribing the drug to non-cancer patients.
Madison reportedly was the state of Illinois’ top prescriber of the fentanyl spray, accounting for 60 percent of all such prescriptions in the state.
He was a prolific prescriber of other controlled substances as well, according to court documents. In the two years prior to his Illinois medical license being revoked, Madison reportedly prescribed about 1.6 million doses of controlled substances out of the Riverside clinic.
In March, five New York City physicians were indicted and charged with accepting bribes and kickbacks from Insys Therapeutics for participating in the company’s alleged sham speakers’ programs.
At the same time, the U.S Attorney’s Office announced that two Insys Therapeutics employees had pleaded guilty for their roles in the bribery and kickback scheme and were cooperating with prosecutors.