Ouch! Pain Clinic Chain Loses Whistleblower Case

Alleged: Overcharged the U.S. Government

Fifty percent of the patient base, the complaint says, were insured under federal-government programs. Based on the 2012 total of patient visits, that would approximate 80,000 federal claims per year from 2012 on.

According to the complaint: “These schemes are part of a business model that is reliant upon keeping patients on a continuous pain management treatment cycle: exhaust coverage of injections; provide orthopedic braces; perform procedures such as a spinal cord stimulation or radiofrequency ablation; prescribe opioids; recommence pain injections… In sum, National Spine’s Board has created a corporate culture in which money trumps the provision of appropriate patient care.”

The government’s lawyers went on to describe a system of bonuses and extra payments which, they alleged, was created by the NSPC board to reward or penalize company’s physicians and care professionals and thereby create the system of fraudulent billing.

“During a training session held at National Spine’s headquarters in early 2012, Gordon[1] instructed Relator and other mid-level providers to bill all services that they provide under the name and NPI number of the ordering physician regardless of whether the ordering physician, another physician, or no physician is present in the office suite. In fact, since all of their services are billed under the name of the ordering physician, mid-level providers at National Spine do not even receive their own Medicare provider number.”

The complaint said that the monetary consequence of billing under the physician’s name is that if billed by a subordinate, the reimbursement is 85% of the amount for the same procedure billed by the physician.

“Relator…witnessed firsthand Capitol Spine, National Spine, Sentinel and National Spine’s Board develop and implement multiple systematic fraudulent schemes to increase revenues and profits and thereby increase their own personal returns on their investments and wealth. The substantial revenue and profits generated through these schemes came at the expense of the government healthcare programs and patients,” the complaint said.

“National Spine’s Board closely monitors physicians’, mid-level providers’, and medical assistants’ compliance with the Company’s revenue maximization policies and requirements,” the complaint said.

The complaint also said that as of the time it was filed, David Vaughn, who had been previously sentenced to 18 months in prison for misrepresenting the finances of an insurance company he ran—a company which subsequently failed, causing losses to both claimants and Louisiana taxpayers—was NSPC’s corporate compliance officer.