Medical device manufacturer THD America Inc., based in Natick, Massachusetts, along with its corporate parent, THD SpA of Italy (collectively, THD), has agreed to pay $700,000 to resolve allegations of violating the False Claims Act. The company was accused of encouraging physicians to submit incorrect billing codes to Medicare and state Medicaid programs to receive inflated reimbursements for its hemorrhoid removal system, the Slide One Kit.
The United States alleged that, between 2014 and 2017, physicians using the Slide One Kit, which is used in the transanal hemorrhoidal de-arterialization (THD) surgical procedure, were required to bill with a temporary code known as a “T-Code.” As this code was designated for experimental procedures, reimbursement was often denied. THD allegedly encouraged surgeons to improperly bill Medicare and Medicaid by using the T-Code along with additional codes or entirely different Current Procedural Terminology (CPT) codes to increase reimbursement potential.
The federal share of the civil settlement amounts to $598,121.23, with the state Medicaid share totaling $101,877.77. State Medicaid programs receive joint funding from both federal and state governments.
Principal Deputy Assistant Attorney General Brian M. Boynton emphasized the importance of maintaining compliance with billing rules, stating, “We will hold accountable health care providers that knowingly submit false claims to federal health care programs that do not accurately reflect and bill for the work they perform.”
U.S. Attorney Erek L. Barron for the District of Maryland reiterated the commitment to combat fraud, noting, “This case is emblematic of the U.S. Attorney’s Office’s commitment to pursuing and holding accountable those who seek to defraud federal health care programs and to recouping taxpayer dollars obtained falsely.”
Special Agent in Charge Maureen Dixon of the Department of Health and Human Services Office of the Inspector General (HHS-OIG) also emphasized the importance of accurate billing, adding that her office will continue working with law enforcement partners to investigate any violations of the False Claims Act.
This settlement resolves claims brought under the qui tam, or whistleblower, provisions of the False Claims Act by Amber Arthur, a former employee of THD America. Under these provisions, private parties can file actions on behalf of the U.S. government and receive a share of any recovery. Arthur will receive $115,500 from the settlement. The whistleblower case is captioned U.S. ex rel. Arthur v. THD America, et al., No. 16-cv-2571 (DMD).
The settlement was the result of coordinated efforts between the U.S. Attorney’s Office for the District of Maryland, the Civil Division’s Commercial Litigation Branch, the Fraud Section, and the HHS-OIG.
