Medical device manufacturer THD America Inc., based in Natick, Massachusetts, and its corporate parent, THD SpA of Italy (collectively referred to as THD), have agreed to pay $700,000 to settle allegations that they violated the False Claims Act. The allegations concern the use of incorrect codes by physicians to secure inflated reimbursements from Medicare and State Medicaid programs for the Slide One Kit (the Kit), a hemorrhoid removal system.
The United States government alleged that between 2014 and 2017, physicians using the Kit were required to bill for the procedure with a temporary code, or "T-Code," designated for new and emerging services. Procedures billed under such codes are often considered experimental, leading to reimbursement denials. To circumvent these denials and increase potential reimbursements, THD allegedly encouraged colorectal and general surgeons to improperly bill Medicare and Medicaid programs using both the T-Code plus an additional Current Procedural Terminology (CPT) code or alternative CPT codes other than the T-code.
Of the $700,000 settlement, $598,121.23 will go towards covering federal shares, while $101,877.77 will cover state Medicaid shares. These programs are jointly funded by federal and state governments.
Principal Deputy Assistant Attorney General Brian M. Boynton emphasized the importance of compliance with coding and billing rules: “The integrity of federal healthcare programs depends upon compliance with coding and billing rules that are used to make coverage and reimbursement decisions.”
U.S. Attorney Erek L. Barron for the District of Maryland stated: “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.”
Special Agent in Charge Maureen Dixon of the Department of Health and Human Services Office of Inspector General (HHS-OIG) highlighted their ongoing efforts: “Accurately billing for services provided to Medicare and Medicaid enrollees is required of all health care companies.”
The civil settlement also 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 United States and receive a portion of any recovery; Arthur's share from this settlement will be $115,500.
This resolution was achieved through coordinated efforts between various governmental bodies including the U.S. Attorney’s Office for the District of Maryland, HHS-OIG, and others.
Assistant U.S. Attorney Tarra DeShields for the District of Maryland and Senior Trial Counsel Jay D. Majors handled this matter.
It should be noted that these resolved claims are allegations only; there has been no determination of liability.