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Press Release

Texas Company Agrees to Reimburse Medicare for Improper Billing Related to Neurostimulators

For Immediate Release
U.S. Attorney's Office, Eastern District of Texas

LONGVIEW, TEXAS – The United States Attorney for the Eastern District of Texas, Stephen J. Cox announced that Spinal Decompression Clinic of Texas (“SDCT”) has agreed to pay $330,898.00 to resolve liability under the False Claims Act for the alleged improper billing of electro-acupuncture device neurostimulators.

           From August 21, 2018 through June 26, 2019, SDCT billed Medicare for the implantation of 41 neurostimulators – a surgical procedure which usually requires an operating room and is reimbursed by federal healthcare programs. SDCT received reimbursement from Medicare in the amount of $177,051.15 for these procedures.  SDCT, however, did not perform these surgeries, and instead applied P-Stim devices in an office setting, without surgery or anesthesia. P-Stim is an electric acupuncture device that, pursuant to manufacturer’s instructions, is affixed behind a patient’s ear using an adhesive. Needles are inserted into the patient’s ear and affixed using another adhesive. Once activated, the device then provides intermittent stimulation by electrical pulses. It is a single use, battery-powered device designed to be worn for approximately four days until its battery runs out, at which time the device is thrown away.

           Medicare does not reimburse for acupuncture or for acupuncture devices such as P-Stim, nor does Medicare reimburse for P-Stim as a neurostimulator or as implantation of neurostimulator electrodes.

“Falsely submitting claims for non-covered services robs from the Medicare program and thereby deprives those in need from vital resources,” said United States Attorney Stephen J. Cox.  “Recovery of improperly paid reimbursements is critical to the long-term sustainability of the Medicare program, and we will do everything we can to ensure that any false claim is quickly recovered.”

           “When services provided are excluded from Medicare reimbursement, some providers may be tempted to falsely claim payment for covered treatments.  Such schemes, however, can result in hefty fines and prosecution,” said Miranda L. Bennett, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “In coordination with our law enforcement partners, we will investigate and hold accountable entities that engage in these practices.” 

           The settled civil claims are allegations only. There has been no determination of civil liability. This case was investigated by the U.S. Department of Health and Human Services of the Inspector General. Assistant U.S. Attorney Aimee M. Cooper handled the matter.      

Updated January 12, 2021

False Claims Act