Health Care Fraud Targets Back Pain Care

Readers of this blog know that health care fraud steals billions from federal and state governments each year. The financial impact ultimately reaches all taxpaying Americans and anyone who uses our health care system, whether or not they use government programs. Our San Francisco health care fraud attorney knows that health care fraud, including medical device fraud, also has a very real impact on the wellbeing and personal medical care of some individual patients. As one of the most common ailments, back-related care is one area threatened by the perpetrators of these wrongs.

Back Pain: Suffering and Spending
Earlier this year, Time Magazine reported that lower back pain is the top cause of job disability around the globe. Additionally, Americans spend more than $50 billion annually on low back pain, despite the fact that it remains difficult to treat. While the news magazine suggests one in ten people suffer low back pain, other sources say eight in ten Americans will experience back pain at some point (see Medline Plus).

Suit Targets Kickbacks and Fraud by Medical Device Manufacturer
To those who commit health care fraud, it seems, this lucrative area of medical treatment is all-too-tempting. Last month, the Sacramento Bee painted the disturbing image of a salesman promising spinal surgeons they could send their kids to college using the money they might make in merely a month as part of an illegal kickback scheme. The scene was not fiction, but rather a secretly recorded meeting involving a medical device company.

According to a recently filed lawsuit, companies tied to Reliance Medical Systems made improper payments to doctors (i.e. kickbacks) for using the company’s medical devices in their spine surgeries. In one example, a doctor allegedly made a $5,000 investment in a Reliance distributorship and received over $20,000 in the first month alone. During the subsequent nine months, the doctor received nearly $265,000 while using Reliance products in his spinal fusion surgeries. Per the federal complaint, some of these surgeries, major back operations, were medically unnecessary and/or excessive. Ultimately, Medicare (and, in turn, taxpayers) paid for the implants. At least one doctor is also facing malpractice charges on conduct related to the spinal surgeries (see Ventura County Star).

Stuart Delery, chief of the Justice Department’s Civil Division, explains that “improper payments to physicians can alter a physician’s judgment about patients’ true health care needs and drive up the costs for everyone.” The scheme diverted millions in taxpayer monies via improper Medicare claims. Two doctors initiated the False Claims Act suit via the Act’s qui tam provisions. Although the government chose to intervene, the private whistleblowers could still receive a significant reward if the charges lead to a recovery of government funds via a settlement or a verdict.

2012 Settlement by Bone Growth Stimulator Manufacturer
This is far from the only medical device fraud suit involving back pain treatments. A Justice Department press release in 2012 reported that Orthofix Inc., a manufacturer of bone growth stimulator devices used in back fusion surgeries, agreed to pay more than $34 million to settle False Claims Act charges. The whistleblower-filed suit and related claims charged that Orthofix: 1) Improperly waived patient co-payments and misstated resulting costs, leading to overpayments from government health programs; 2) Paid kickbacks to induce doctors and medical staff to use their products; 3) Contributed to falsified medical necessity certifications; and 4) Failed to tell patients about product rental options. The private whistleblower who brought the suit was slated to receive $9.2 million of the monies he helped recover. The company also agreed to sign a corporate integrity agreement that put in place processes to avoid and detect future fraudulent conduct. One government official declared, “Criminals intent on placing profits from federal health programs over and above compliance should expect to tangle with authorities.”

Working With Whistleblowers to End Health Care Fraud
While health care fraud is an economic crime, the schemes often put the well-being of individual patients at risk. Perpetrators steal from taxpayers and knowingly profit at the expense of people’s health and well-being. These frauds thrive on silence. We believe people are often silent in the face of health care fraud not because they don’t want to report it, but because they are unsure of how to proceed or worried about retribution. As a Northern California whistleblowers’ law firm, we help private citizens become part of the fight against health care fraud. Call to learn more.

(Image by Sue Clark)