Why victims of deadly meningitis outbreak haven’t been compensated

https://www.washingtonpost.com/world/national-security/everybody-has-dropped-the-ball-why-victims-of-the-deadliest-meningitis-outbreak-in-us-history-havent-been-compensated/2016/05/24/a7f2c37c-1ea1-11e6-8c7b-6931e66333e7_story.html

Kathy Pugh quit her job when her mother got sick from a tainted medication, and now Pugh spends her days helping the once-vibrant 85-year-old get out of bed, shower and dress. If her mom ever were compensated for what she endured, Pugh said she would like to install laminate flooring — which would make it easier to move around in a wheelchair — and maybe buy a handicap van.

Evelyn Bates-March, Pugh’s mother, is one of hundreds of victims of a 2012 outbreak of fungal meningitis that federal investigators traced to a batch of contaminated steroid injections manufactured by the New England Compounding Center. A civil fund of more than $200 million was created after victims sued the compounding center and companies with which it did business. The federal government also has money available to compensate crime victims.

But the 85-year-old, like all the others affected by the outbreak, has yet to see a dime to help her cope with how her life has changed since she was given a tainted shot.
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Ongoing negotiations with the Centers for Medicare and Medicaid Services over what portion that agency, which paid some of the medical bills, should receive have stalled any payments to victims from the civil fund.
Kathy Pugh, right, sits with her mother, Evelyn Bates-March, who fell ill after receiving a tainted steroid shot in 2012. (Photo courtesy of Kathy Pugh)

Prosecutors — who charged two leaders of the compounding center with racketeering and second-degree murder — separately have advocated making federal victim-assistance money available to the victims, though their request has been waylaid by a dispute in the top levels of the Justice Department, people familiar with the case said.

“It’s been devastating,” Pugh said. “Everybody has dropped the ball.”

The case illustrates how the court system, the Justice Department and other parts of the federal bureaucracy can slow or even stop crime victims from obtaining financial assistance that most would agree they deserve.

Wyn Hornbuckle, a Justice Department spokesman, said in a statement, “We are still exploring funding options for the NECC victims,” but he declined to provide any specific information about what that exploration entailed. A spokeswoman for the U.S. attorney’s office in Boston, which is prosecuting the criminal case, reiterated that “no final determination has been made.”

“We will continue to do all that we can to ensure compensation for the victims in this case,” said the spokeswoman, Christina Sterling.

The 2012 meningitis outbreak had a devastating impact. According to federal prosecutors and the U.S. Centers for Disease Control and Prevention, more than 750 people got a fungal infection after receiving injections from the New England Compounding Center, and at least 64 people died — making it the deadliest meningitis outbreak in U.S. history.

In 2014, federal prosecutors alleged the incident was criminal. They charged 14 people in a 131-count indictment, alleging employees at the New England Compounding Center knew they were producing medication in an unsafe and unsanitary way and shipping it to customers anyway. Owner and head pharmacist Barry J. Cadden and supervisory pharmacist Glenn A. Chin were charged with 25 acts of second-degree murder and are scheduled to go on trial later this year.
Lyn Laperriere in 2006, six years before he was killed by a deadly meningitis outbreak. His wife, Penny Laperriere, is now among hundreds unsuccessfully seeking compensation as crime victims from the Justice Department. (Photo courtesy of Penny Laperriere)

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Lawyer Stephen J. Weymouth, who represents Chin, said his client, who has pleaded not guilty, “wants people to be compensated financially from as many different sources as can be possibly financed.” An attorney for Cadden did not immediately return phone and email messages seeking comment.

Penny Laperriere, 59, of Sterling Heights, Mich., said her husband, Lyn, began to struggle within a few weeks of having a shot with the tainted medication in 2012. A bowler whose average topped 200 a game, Lyn suddenly began to struggle with balance and couldn’t finish a practice, she said. Then came the splitting headaches, which caused pain so severe he had to be hospitalized, she said.

Laperriere said doctors traced Lyn’s symptoms to a contaminated shot, but the treatment — anti-fungal medication with nasty side effects — failed. One night, when Lyn’s parents and sister were in town visiting, Laperriere said doctors called to say her husband, a retired General Motors machine repairman who would travel the country racing cars, had “flat-lined.” She said doctors revived him but “I knew he was brain-dead.”

In October 2012, the family took him off life support. He was six days shy of his 62nd birthday.

Laperriere said she had to sell her home because it required too much maintenance, and she had to put her and her husband’s dogs up for adoption because their vet and other bills were too high. She said she does not think she will see any money in compensation after lawyers and others take their cut.

“Which is really sad,” Laperriere said. “My husband died, and his pain and suffering is worth nothing?”

There are two pools of money from which victims might be paid: federal funds and funds from the civil lawsuits. Kimberly Dougherty, a Boston lawyer representing 100 victims, said each victim has been sent a letter stating how much he or she is eligible to receive from the civil fund, but payouts have been stalled while lawyers negotiate with the Centers for Medicare and Medicaid Services, which covered some of the victims’ medical care and has liens on the payouts. Dougherty said the victims share “a sense of frustration, particularly when they know there’s money sitting in a bank account that they can’t access.”

A spokesman for the Centers for Medicare and Medicaid Services said in a statement that Medicare “paid for medical care associated with” the outbreak and was “required by law to recover those payments from settlements like the NECC settlement.”

“We understand that many NECC settlement recipients who are Medicare beneficiaries are concerned about the distribution of the settlement money,” the spokesman said. “Medicare routinely works to make sure that, in similar situations, beneficiaries are able to keep a portion of their settlement.”

Separately, federal prosecutors in Boston and the Justice Department’s Office for Victims of Crime have advocated that victims be compensated using funds from the Antiterrorism and Emergency Assistance Program, which sets aside $50 million from the federal government’s $9 billion Crime Victims Fund for victims of terrorism or mass violence. But the Office of Justice Programs’ Office of General Counsel determined that the injuries sustained by the victims were not the result of an “intentional violent criminal act,” as the program requires and, thus, were not eligible for funds from it, according to officials familiar with the matter.

Though Justice Department officials say other funding mechanisms are being discussed, victims say they think they are being treated unfairly.

Willard Mazure Jr., 55, of Jackson, Mich., said before he received the tainted shot, he was a heavy-equipment operator who would hunt and fish regularly. Now he lives off disability and his wife’s income, unable to work because his short-term memory is virtually gone and even modest physical activity can leave his legs feeling as if they’re being prodded with pins and needles.

The compensation for each victim from Justice Department funds, which are administered through the state, might be minimal. Massachusetts law likely limits the payouts for most to $25,000, though those with “catastrophic” injuries could receive as much as $50,000. The victims say even that would help, and they have waged an aggressive campaign to persuade government officials to free up the money. Officials estimate that as much as $25 million might be needed for all those affected.

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Eighteen members of Congress from both political parties recently wrote to Shaun Donovan, the director of the Office of Management and Budget, asking that the decision to keep money from the victims be reversed. A spokeswoman for that agency said in a statement that the issue was “still being considered by the Department of Justice and has not yet been referred to the Office of Management and Budget.”

“If and when it is, we will move swiftly to make a determination,” the spokeswoman said.

Mazure said although financial compensation would be welcome, it would not undo the damage the shots inflicted on him.

“Every cent will help,” Mazure said, “but nothing will make me whole.”

Adam Goldman contributed to this report.

Filed under: General Problems