Medical device maker, surgeon pays $46 million in kickback scheme


Surgeons who receive leave or other freebies from medical device companies could face penalties such as fines, stricter monitoring and even jail time, according to experts familiar with federal anti-kickback laws.

Historically, enforcement action has focused primarily on the individual or organization offering the benefit, not necessarily the physician accepting it. Medscape Medical News.

But that is changing.



“There’s been a trend in recent years to try and hold accountable those who receive the incentives, such as doctors,” said Ortquist, former board member and president of the Health Care Compliance Association. He said authorities typically pursue provocative companies first before moving on to individual clinicians and clinics.

The Department of Justice (DOJ) followed a similar pattern in its recently announced kickback settlement involving an intraocular lens distributor, an ophthalmic equipment supplier, two CEOs, and a surgeon. Precision Lens has to pay more than $43 million to provide luxury vacations and other expensive perks to surgeons who use its cataract products.

The ruling marks the end of a six-week civil jury trial that saw Paul Ehlen, owner of Precision Lens and its parent company Cameron-Ehlen Group, pay a secret “slush money” to pay kickbacks to ophthalmologists. Evidence has emerged that the The solicitation scheme generated millions of dollars in sales for the Minnesota-based company, and from 2006 to 2015, he filed 64,575 false Medicare claims. This violates anti-kickback and false claims laws.

According to court documents, doctors often travel by private jet to attend Broadway musicals and major sporting events, and they often travel on luxury trips, such as skiing, fishing or golfing excursions at special destinations. Received an entertainment package. Ehlen and company representatives sold frequent flyer miles to physicians at significant discounts, enabling personal and business travel at below fair market value.

Federal authorities originally announced an investigation into the business practices of precision lenses in 2017. This comes after Kip, a former executive at ophthalmic supply supplier and Precision Lens “corporate partner” Cytopath his Medical, received a whistleblower complaint from Fesenmeyer. Fesenmaier claimed that both companies were involved in the recruitment scheme.

Sightpath Medical and its CEO, James Tiffany, have agreed to a $12 million settlement to settle kickback claims.

DOJ then investigated Jitendra Swarup, MD, an ophthalmologist and cataract surgeon who allegedly received “illegal compensation from Sightpath, Precision, and Ehlen” and submitted false insurance claims. Swarup was paying more than $100,000 a year for consulting services, as well as taking expensive hunting and fishing trips from medical device companies.

Swarup has agreed to settle approximately $3 million and participate in a three-year corporate integrity agreement with the Office of the Inspector General. In return for complying with such agreements, the OIG will allow physicians to continue to participate in Medicare, Medicaid, and other federal health care programs.

In a statement from their attorneys, Precision Lens and Ehlen said they will appeal the verdict and “defend our perfectly appropriate conduct,” while continuing to focus on our commitment to medical clinicians and manufacturers. I made a pledge.

“Infinite” Opportunities for Seduction

Unfortunately, the opportunities for attraction are “endless,” experts say. Extravagant trips, dinners, and gifts can cause violations, but almost anything of value can.

Just last year, Biotronik reached a $12.95 million settlement amid allegations that company representatives offered wine and food to doctors to encourage them to use pacemakers and defibrillators. To date, no doctors have been charged.

But last fiscal year’s record number of whistleblower convictions totaled more than $2 billion, so doctors need to be careful, Radha Bhatnagar, Esq, director of compliance at CM Group, told Medscape. rice field.

“When a manufacturer adds a fraudulent Medicare or Medicaid reimbursement element to offer rebates to doctors, it’s usually because the manufacturer and Individuals are subject to civil and criminal liability,” Bhatnagar said, referring to what the Justice Department said last year when it announced a settlement involving 15 Texas doctors.

In another case, Kingsley R. Chin, an orthopedic surgeon and designer of spinal implants, was indicted in 2021 for paying millions of dollars in bogus consulting fees to doctors who used his products. At least six of his surgeons who took money from Ching were later named in a civil suit and ordered to pay a $3.3 million fine.

Orthopedic surgeon Jason Montone, DO, who accepted illegal payments, agreed to a plea bargain with a reduced prison sentence, one year of supervised release, and a $379,000 fine.

Chin’s sentence has not been announced, but he could face up to 10 years in prison for violating kickback laws.

Steph Weber is a Midwest-based freelance journalist who specializes in healthcare and law.



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