Former Sioux City Plastic Surgeon Agrees to Pay Nearly $200,000 to Settle Allegations He Submitted False Claims

Adam B. Smith, M.D., also known as “Adam Bryant,” has agreed to pay $198,755.42 to the United States and the State of Iowa to resolve allegations that he billed government health insurance programs, including Medicare and Medicaid, for medically unnecessary procedures and for procedures more complicated than those he performed. The settlement resolves allegations brought by the United States and the State of Iowa in a Civil Complaint filed last May in the United States District Court for the Northern District of Iowa. The settlement amount was based on Smith’s ability to pay.

In its Complaint, the government alleged that, from August 2014 until August 2019, Smith was practicing as a plastic surgeon in Sioux City in association with Tri-State Specialists, L.L.P. During that time, the government alleged, Smith engaged in a scheme to overcharge government health care programs by falsely claiming that cosmetic procedures he performed were medically necessary and that the medically necessary procedures he billed for were more complicated (and more highly compensated) than what he performed. Cosmetic procedures are generally not covered by Medicare or Medicaid. To obtain federal payment for procedures that would not otherwise be covered, the government alleged Dr. Smith claimed he performed complicated hernia repair or tissue transfer procedures when he actually performed body contouring, tummy tucks, and cosmetic procedures to remove excess skin and fat.

The Complaint also contended that Smith submitted claims for more expensive wound repair procedures and office visits by claiming the wounds he repaired were larger, the procedures he performed were more complex, and the office visits were more thorough, than they actually were. This practice, known as “upcoding,” occurs when medical providers fraudulently overcharge insurers for more significant (and more expensive) procedures than they perform.

In February 2021, Smith pleaded guilty to one count of making a false statement relating to a healthcare matter, in violation of Title 18, United States Code, Section 1035(a), in the United States District Court for the Western District of Michigan. As part of his plea, Smith acknowledged that he had falsely described a cosmetic procedure as medically necessary and reimbursable by Medicare while he was practicing medicine in Traverse City, Michigan from May 2011 to January 2014. Smith voluntarily surrendered his South Dakota medical license in 2019 and his Iowa medical license in 2021.

The United States entered into a settlement agreement with Smith’s employer, Tri-State Specialists, LLP, in December 2021, resolving the same allegations for $612,501.44.         

“Government healthcare programs depend on the honesty and competency of healthcare providers. Our office will work tirelessly to pursue providers who break that trust and to recover dollars meant to benefit the American people,” said United States Attorney Timothy T. Duax.

“Holding health care professionals accountable for submitting false claims to Medicare and Medicaid is crucial for maintaining public trust and ensuring critical resources are appropriately used,” said Special Agent in Charge Linda T. Hanley with the United States Department of Health and Human Services Office of Inspector General (HHS-OIG). “HHS-OIG, the U.S. Attorney’s Office, and our other law enforcement partners will continue to collaborate to protect the integrity of federal health care programs.”

“Today’s outcome demonstrates the collaboration among the Defense Criminal Investigative Service (DCIS) and its investigative partners to safeguard taxpayer dollars that fund programs like Tricare, the military’s healthcare system,” said Acting Special Agent in Charge Ryan Settle of the DCIS Southwest Field Office. “As the criminal investigative arm of the DoD Office of Inspector General, DCIS is committed to investigating those who put the health of America’s warfighters and their families at risk.”

This civil matter arose from an action brought under the whistleblower provisions of the False Claims Act.

The claims asserted against Smith are allegations only; there was no determination or admission of liability.

The case was handled by Assistant United States Attorneys Brandon J. Gray and Brian J. Keogh and the State of Iowa Attorney General’s Office and investigated by the United States Department of Health and Human Services, Office of Inspector General; the United States Department of Defense Office of Inspector General, Defense Criminal Investigative Service; and the State of Iowa’s Medicaid Fraud Control Unit.  

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