A Tennessee business owner has been found guilty of fraudulently billing federal health care programs approximately $35 million. The fraudulent activity involved medically unnecessary injections administered to opioid-dependent patients over about eight years.
Michael Kestner, 72, from Nashville, was convicted by a federal jury. He owned and managed pain clinics in Tennessee, North Carolina, and Virginia under the name Pain MD. Evidence presented at trial showed that Kestner pressured medical staff to administer multiple back injections to most patients seeking opioid treatment at Pain MD. Patients who refused these injections risked being denied treatment and facing withdrawal symptoms.
The trial revealed that these injections were billed as Tendon Origin Insertion injections (TOIs), despite patients not having tendon pain diagnoses. It was often medically impossible to perform TOIs with available equipment. Kestner pressured clinic providers to continue administering and billing for these injections.
To maintain high billing levels, Kestner ranked practitioners based on their "production," criticized those with below-average performance, and implied job security depended on increasing injection numbers. He ignored warnings from insurance companies about improper billing practices. As a result, Pain MD became the highest biller of TOI procedures for Medicare in the nation.
Kestner was convicted of one count of conspiracy to commit health care fraud and 12 counts of health care fraud. Sentencing is scheduled for February 27, 2025. He faces up to 10 years in prison for each count. A federal district court judge will determine the sentence based on U.S. Sentencing Guidelines and statutory factors.
The announcement came from Principal Deputy Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division; Special Agent in Charge Kelly J. Blackmon of HHS-OIG; Special Agent in Charge Darrin K. Jones of DCIS Southeast Field Office; Special Agent in Charge Kim R. Lampkins of VA-OIG Mid-Atlantic Field Office; and Director David Rausch of TBI.
The case is being investigated by HHS-OIG, DCIS, VA-OIG, and TBI.
Assistant Chief James V. Hayes and Trial Attorney Victor Yanz are prosecuting the case with help from Assistant Chief Kate Payerle from the Criminal Division’s Fraud Section.
The Fraud Section combats health care fraud through its Health Care Fraud Strike Force Program since March 2007, charging over 5,400 defendants who have collectively billed more than $27 billion to federal health care programs and private insurers.
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