Department of Justice Announces Two Settlements Under the False Claims Act

On April 15, 2020, the Department of Justice announced the following settlement agreements under the False Claims Act (FCA):

The U.S. Attorney’s office for the Eastern District of Pennsylvania announced that a laboratory, pain clinic and two former executives agreed to pay $41 million dollars to resolve allegations under the FCA related to unnecessary Urine Drug Testing (UTD).    According to the announcement, the defendants allegedly submitted claims to Medicare, Medicaid, TRICARE and other federal healthcare programs for presumptive and definitive UDT that were not medically reasonable or necessary. Presumptive UDT are tests that screen for the presence of drugs while definitive UDT identify the amounts of those drugs in a patient’s system. The defendants allegedly implemented a policy of automatically ordering both presumptive and definitive UDT for all patients at every visit, without a physician determining either test was medically necessary. The U.S. Attorney stated that the tests were indiscriminate and unnecessary, increasing medical costs to the U.S. government without serving the patients’ real medical needs.  This settlement announcement may be accessed here.

The United States Attorney’s Office for the District of Maryland announced that a Baltimore physician agreed to pay the United States $436,000 to settle allegations regarding false claims for medically unnecessary autonomic nervous function tests and trigger point injections billed to Medicare. According to the announcement, autonomic nervous function disorders are fairly uncommon and tests to determine such disorders should only be performed after a clinician suspects an autonomic nervous function disorder. The government considered the claims to be medically unnecessary for the following reasons:

• The physician lacked the necessary equipment to conduct the autonomic nervous function disorder tests;
• The patients were not determined to have an autonomic nervous function disorder prior to the test being conducted;
• The physician lacked the necessary training to conduct autonomic nervous function disorder tests;
• The physician used the tests only to monitor patient symptoms, not to make any clinical decisions regarding future patient care.

Additionally, the physician allegedly submitted false claims to Medicare for medically unnecessary trigger point injections using ultrasound guidance. Medicare reimbursement policy provides that trigger point injections may be utilized to treat patients with localized muscle pain where there are palpable and painful knots or nodules, but only after the patient has attempted non-invasive medical management (e.g., muscle relaxers and topical analgesics), which prove unsuccessful. The allegations included that the physician failed to document that his patients had a muscular knot or nodule and failed to demonstrate that non-invasive medical procedures had been exhausted prior to administering the injections. Further, the government contended that the ultrasound guidance billed was not medically indicated as the muscular knot or nodule should have been palpable at the time of administering the injection. This settlement announcement may be accessed here.

These announcements continue to highlight the importance of medical necessity and supporting documentation and engaging in proactive compliance measures.

For more information regarding the False Claims Act or compliance, please contact your regular HLP attorney, Abby Pendleton (apendleton@thehlp.com), Clinton Mikel (cmikel@thehlp.com), Partners@thehlp.com, or call (248) 996-8510 or (212) 734-0128.