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Medical practice pays $3.3M for alleged unnecessary tests

A Virginia-based pain management practice will pay $3.29 million to settle allegations that it overcharged the federal government and billed it for medically unnecessary tests.

The case was brought by former Physical Medicine Associates LTD employee Michelle O’Connor, a physician assistant who said PMA and its practice management company National Spine and Pain Centers LLC violated the False Claims Act in overcharging the government. PMA and NSPC have pain management clinics in Northern Virginia, Henrico County and Fredericksburg.

The lawsuit claimed PMA, NSPC and 14 other defendants, including six physicians, engaged in three different kinds of unlawful conduct dating back to 2010. This included billing for services performed by physician assistants and nurse practitioners as “incident to” a physician’s service, when the work did not qualify as such; submitting claims for urine drug tests that were in violation of the Stark Law and the Anti-Kickback Statute, and therefore ineligible for reimbursement by the government; and referring patients for medically unnecessary “quantitative” urine drug tests performed and billed to the government by third-party labs.

As a result, Medicare, TRICARE and the Federal Employees Health Benefits Program were all alleged to have been overcharged.

O’Connor acted as a whistleblower in bringing the lawsuit in Virginia’s Eastern District in Richmond, meaning that she is entitled to 18%, or $592,200, of the total settlement.

“This settlement illustrates the positive impact that one brave person can have if you step forward when you believe the government has been cheated and taxpayer dollars wasted,” said Jeanne A. Markey, a Philadelphia attorney who represented O’Connor along with fellow Cohen Milstein Sellers & Toll attorneys Gary L. Azorsky and Casey M. Preston.

She said the case was brought to her firm’s attention by Washington-area attorney David E. Haynes, who also represented O’Connor in the case.

The settlement was reached April 19 after the federal government intervened on O’Connor’s behalf. All 16 defendants were dismissed as part of the settlement agreement and the defendants admitted no liability in settling.

Assistant U.S. Attorney Robert P. McIntosh represented the government in the case. Laura F. Laemmle-Weidenfeld of Washington represented the defendants in the case. Neither immediately responded to requests for comment.