Cardiac Monitoring Device Company Settles Allegations of Defrauding Government Healthcare Programs

BioTelemetry, a company that manufactures cardiac monitoring devices that send data straight to a patient’s cell phone, has agreed to pay $6.4 million to the federal government.
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In a recent healthcare fraud settlement, Pennsylvania-based BioTelemetry and its subsidiary CardioNet have settled startling allegations involving the submission of claims for reimbursement to cover certain cardiac monitoring devices that were not eligible for coverage under Medicare and Medicaid guidelines. The company is one of two cardiac monitoring device companies recently on the hook for false claims, a group that also includes LifeWatch Services, Inc., which settled with the government in 2012.

The alleged billing misconduct was brought to light pursuant to a concerted investigation by the Department of Health and Human Services, as well as the Office of Inspector General. While the specific details of the whistleblower’s involvement were not revealed in this particular instance, cases involving illegal billing practices are often filed by plaintiffs under the False Claims Act’s qui tam provisions. Successful qui tam plaintiffs may be able to receive up to 30 percent of the final settlement or verdict. According to the Department of Justice, the case against BioTelemetry and its subsidiary sprung from the whistleblower lawsuit filed against LifeWatch, which resulted in an $18.5 million settlement.

Details of the allegations against BioTelemetry

CardioNet is in the business of manufacturing and marketing heart monitors designed for patient convenience. Known as Mobile Cardiac Outpatient Telemetry (“MCOT”), CardioNet specializes in offering patients the ease of a cardiac monitoring device that can be worn during daily activities on an outpatient basis. The MCOT in question was developed by CardioNet to allow patient cardiac information to be uploaded to CardioNet’s diagnostic center in real time using cell phone technology. The monitors provide a faster, more accurate reading than the traditional MCOT model, which historically transfers data to diagnostic centers via a landline and is not transmitted in real time.

While the technology behind CardioNet’s devices is certainly cutting-edge, it is considered too advanced for purposes of Medicare and Medicaid reimbursements, especially when the traditional MCOT format works just as well to record patient data. Accordingly, CardioNet triggered False Claims Act exposure by submitting invoices for reimbursement, which were ultimately deemed to be not medically necessary. The allegations specifically surround the prescription of these devices for patients with mild to moderate cardiac arrhythmia for whom the older model would have worked just fine. By intentionally billing the government for these more expensive models, using a more valuable code, CardioNet allegedly engaged in illegal false billing practices.

Help eliminate wasteful spending and fraud

According to a statement by the Department of Health and Human Services, “Sticking taxpayers with a hefty bill for unneeded medical care will never be tolerated….Working in close coordination with our law enforcement partners we will tirelessly pursue and prosecute these suspected violators.”

If you are aware of suspicious billing practices, either at your place of employment or by your healthcare provider, we encourage you to contact Berger Montague today for help with your case.