Archive

March 23, 2021

Medical device manufacturer Boston Scientific Corporation has agreed to pay $188.6 million to 47 states and the District of Columbia to resolve allegations concerning its transvaginal surgical mesh, which were found to be deceptively marketed in violation of consumer protection laws and allegedly caused serious complications for thousands of women nationwide. As part of the settlement, Boston Scientific also agreed to implement various marketing, training, and clinical trial reforms. Similar settlements were previously reached with other medical device manufacturers, including Johnson & Johnson, which paid $116.9 million in 2019, and C.R. Bard, which paid $60 million in 2020. CA AG; FL AG; NY AG

Tagged in: Defective Products, Medical Devices and DME,

March 2, 2021

North Carolina durable medical equipment provider A Perfect Fit for You, Inc. and its owner Margaret Gibson have agreed to pay a total of $24.14 million to resolve civil claims that they falsely billed Medicaid for DME that had never been ordered or delivered, including by using the personally identifying information of Medicaid recipients who had been dead for years. In addition, to resolve criminal charges of healthcare fraud, the company will pay an additional $2 million fine and $10.1 million in restitution to the North Carolina Medicaid program. USAO ED NC

Tagged in: Criminal Proceedings, FCA Federal, Healthcare Fraud, Medicaid, Medical Billing Fraud, Medical Devices and DME,

February 25, 2021

Following a self-disclosure to the U.S. Department of Health and Human Services in 2018, Bioventus, LLC has agreed to pay more than $3.6 million to resolve allegations of violating the False Claims Act in connection with sales of its Exogen ultrasonic bone growth stimulator device. According to Bioventus, it discovered that its sales representatives sometimes improperly completed sections of certificates of medical necessity (CMN) that Medicare rules require be completed by treating physicians or physician offices. USAO MDNC

Tagged in: Certifications, FCA Federal, Healthcare Fraud, Medical Devices and DME, Medicare,

February 12, 2021

The operator of Georgia-based durable medical equipment company Wilmington Island Medical Inc. has been sentenced to two years in prison and ordered to pay about $550,000 in restitution for paying kickbacks to doctors and nurse practitioners in exchange for signed orders and then billing those orders to Medicare. The judgment against Patrick Wolfe is part of an ongoing investigation by the Southern District of Georgia to crack down on more than $1.5 billion in losses to Medicare and Medicaid originating from the district. So far a total of thirty-one individuals and companies have been charged. USAO SDGA

Tagged in: Anti-Kickback and Stark, Criminal Proceedings, FCA Federal, Healthcare Fraud, Medical Devices and DME, Medicare,

February 4, 2021

Durable medical equipment company Regency, Inc., has agreed to a $20.3 million civil settlement to resolve allegations that, together with its principal Kelly Wolfe, it violated the False Claims Act by creating dozens of front companies to submit over $400 million in false claims to government healthcare programs for the sale of DME that was not medically necessary. Defendants were alleged to have paid unlawful kickbacks to doctors and falsely claimed that those doctors provided telehealth services to the beneficiaries, when in most cases the doctors had no interaction at all with the beneficiaries. Wolfe also pleaded guilty to conspiracy to commit healthcare fraud and will be sentenced at a later date. Former Regency employee Condra Albright will receive 23% of the civil recovery as a whistleblower reward. DOJ; USAO MD FL

Tagged in: Anti-Kickback and Stark, Criminal Proceedings, FCA Federal, Lack of Medical Necessity, Medical Billing Fraud, Medical Devices and DME, Whistleblower Case, Whistleblower Rewards,

December 21, 2020

DME provider Apria Healthcare Group, Inc. and Apria Healthcare LLC will pay $40.5 million to settle allegations brought in a qui tam action filed by three former Apria employees that they improperly billed government healthcare programs for beneficiary rentals of non-invasive ventilators (“NIVs”) that were not medically necessary or which were provided with improper waivers of patient co-payments. Medicare pays as much as $1,400 a month for NIVs, and providers are required to monitor patient usage of NIVs and stop billing when the NIVs are no longer being used. Apria respiratory therapists failed to monitor patient NIV usage and even when Apria knew that patients were no longer using the NIVs, Apria often did not take steps to stop seeking payment. In addition, Apria sales staff steered doctors and beneficiaries to use NIVs when less-expensive alternatives were available, and routinely waived co-payments for NIV patients without making an assessment of the patient’s financial need. USAO SDNY; CA AG; FL AG

Tagged in: FCA Federal, Healthcare Fraud, Lack of Medical Necessity, Medicaid, Medical Billing Fraud, Medical Devices and DME, Whistleblower Case,

December 16, 2020

Handicare USA, which manufactures and installs patient lift and mobility systems for healthcare facilities, agreed to pay $800,000 to resolve claims that it knowingly provided products to the Veterans Administration that failed to comply with the Trade Agreements Act. A whistleblower tipped the government that Handicare patient lifts installed at VA facilities used parts made in China for the mounting system that secured the patient lift to the ceiling, and took steps to conceal its non-compliance, including by instructing that the products should be installed so that the “Made in China” stamps on metal parts would not be visible. USAO DC

Tagged in: Government Procurement Fraud, Healthcare Fraud, Medical Devices and DME, Trade Agreements,

December 4, 2020

Joint Active Systems, Inc. (JAS), a durable medical equipment manufacturer, and New England Orthotics & Prosthetics, LLP (NEOPS) have agreed to pay $1.59 million and $90,000 respectively to resolve allegations of defrauding multiple federal healthcare programs—including TRICARE, Medicare, and Medicaid programs in Connecticut, Massachusetts, and Rhode Island—through a variety of fraudulent schemes. According to a qui tam suit filed by two former NEOPS employees, JAS allegedly recruited NEOPS to bill Medicare and Medicaid for custom-fabricated orthotics that were not custom-fabricated orthotics, nor medically necessary, and falsely claim that JAS-affiliated sales representatives were properly trained to treat patients during fittings. Additionally, JAS allegedly overcharged the VA for its devices by as much as 300%. For blowing the whistle on these fraud schemes, the whistleblowers will receive a 17% share of the settlement proceeds. USAO MA

Tagged in: FCA Federal, Healthcare Fraud, Improper Medical Personnel, Medicaid, Medical Billing Fraud, Medical Devices and DME, Other Government Health Programs, Whistleblower Case, Whistleblower Rewards,

November 19, 2020

Johnson & Johnson (J&J) subsidiary Medical Device Business Services, Inc. (MDBS) has agreed to pay $10 million to settle allegations that a former J&J subsidiary, Therakos, Inc., promoted two medical devices for unapproved uses in pediatric patients. A second entity, The Gores Group (TGG), agreed to pay $1.5 million to settle allegations of continuing to promote the devices for unapproved uses after it acquired Therakos in 2012. In an action initiated by a whistleblower, the government alleged that between 2006 and 2015, Therakos improperly promoted its extracorporeal photopheresis (ECP) systems, used to treat cutaneous T-cell lymphoma, for use in children despite the fact that no ECP devices had been approved for that population. In so doing, Therakos allegedly caused false claims to be submitted to Medicaid, the Federal Employee Health Benefits Program, and TRICARE, in violation of the False Claims Act. The total settlement funds were divided between federal and state governments. USAO EDPA; CA

Tagged in: FCA Federal, Medicaid, Medical Devices and DME, Off-Label and Unapproved Use, Other Government Health Programs, Whistleblower Case,

October 29, 2020

Medtronic has agreed to pay over $9.2 million to resolve allegations of violating the False Claims Act and CMS’s Open Payments Program by paying kickbacks to a South Dakota-based neurosurgeon, Wilson Asfora, M.D., in order to induce sales of its SynchroMed II implantable intrathecal infusion pumps. According to the government, Medtronic allegedly sponsored nine years’ worth of events at a restaurant owned by Asfora, and to which Asfora would invite his acquaintances, business partners, trusted colleagues, and referral sources. For his role in the kickback scheme, Asfora has been named in a separate FCA lawsuit, which the United States joined last November. USAO SD

Tagged in: Anti-Kickback and Stark, FCA Federal, Healthcare Fraud, Medical Devices and DME, Medicare,

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