WASHINGTON – David Podell, a New Jersey chiropractor, has
agreed to pay the United States $2 million to resolve False Claims Act
allegations that he both knowingly billed Medicare for medically-unnecessary
viscosupplementation injections and knee braces and that he received illegal
kickbacks, the Justice Department announced today. The settlement follows the government’s
earlier settlement with seven former Osteo Relief Institutes (ORIs) and their
owners, who agreed to pay the United States collectively more than $7.1 million
to resolve their False Claims Act liability.
“Billing for services or items that are medically
unnecessary or tainted by illegal kickbacks threatens the integrity of federal
healthcare programs,” said Assistant Attorney General Jody Hunt of the
Department of Justice’s Civil Division.
“The department will continue to pursue providers who seek to improperly
enrich themselves at the expense of these programs, their beneficiaries, and
the taxpayers.”
Podell previously owned and managed a clinic in Edgewater,
New Jersey that performed viscosupplementation, among other procedures. Along with a business partner, he also
promoted a business model to other chiropractors for running and marketing a
clinic that specialized in the treatment of osteoarthritis through the
administration of fluoroscopic-guided viscosupplementation injections and the
provision of knee braces. This led to
the formation of the ORIs.
Viscosupplementation is a treatment for osteoarthritis, in which a
doctor injects a gel-like fluid into a patient’s knee joint to act as a
lubricant and to supplement the natural properties of joint fluid. Through his association with his business
partner, Podell received a percentage of the ORIs’ collections.
The government alleged that Podell caused his clinic and
other ORIs to bill Medicare for viscosupplementation injections for patients
who did not need them, to use multiple brands of viscosupplements successively
on patients without clinical support, and to use discounted viscosupplements
reimported from foreign countries. The
government also alleged that Podell caused his clinic and the ORIs to provide
unnecessary custom knee braces to patients.
The government further alleged that Podell solicited and received
kickbacks from a manufacturer of knee braces in exchange for ordering more of
the manufacturer’s braces for his clinic.
“When medical professionals seek to increase their revenue
by improperly exploiting public healthcare programs, beneficiaries suffer and
taxpayer dollars are wasted,” said U.S. Attorney Erica H. MacDonald for the
District of Minnesota. “Today’s settlement
serves as another example of our commitment to address fraud and abuse in the
healthcare system.”
“Medical providers have a responsibility to ensure that the
products and services that they provide are medically necessary and
appropriate,” said Special Agent in Charge Lamont Pugh III, U.S. Department of
Health & Human Services, Office of Inspector General – Chicago Region. “Providing medically unnecessary products and
services can put a patient’s health and safety at risk and waste vital taxpayer
dollars. HHS-OIG will continue to
investigate and hold accountable those who put their financial interests above
those of Medicare beneficiaries.”
The allegations resolved by today’s settlement were
identified by a government investigation that arose out of a critical analysis
of Medicare claims data. The
government’s settlement in this matter illustrates its emphasis on combating
health care fraud. One of the most
powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about
potential fraud, waste, abuse, and mismanagement can be reported to the
Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
The matter was investigated by the Civil Division’s
Commercial Litigation Branch, the U.S. Attorney’s Office for the District of
Minnesota, the Department of Health and Human Services Office of Inspector
General, and the Federal Bureau of Investigation.
The claims asserted against this defendant are allegations
only, and there has been no determination of liability.
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