Consumer Fraud

Whistleblower Suit Exposes Missouri Neurosurgeon’s Kickback Scheme

whistleblower Whistleblower Suit Exposes Missouri Neurosurgeon’s Kickback SchemeA lawsuit filed under the whistleblower provisions of the False Claims Act against a Missouri neurosurgeon and his fiancée has resulted in a recovery for the Medicare program.

The lawsuit, brought by a group of physicians and other health care providers in 2014, accused Dr. Sonjay Fonn of Cape Girardeau and his fiancée Deborah Seeger of operating a mutually beneficial kickback scheme that resulted in the submission of false claims to Medicare.

According to the whistleblower suit, the kickback scheme was hatched in 2008 when Ms. Seeger started a spinal implant distributorship, DS Medical, that supplied most of the spinal implants Dr. Fonn performed from 2009 to 2012.

Ms. Seeger would receive commissions as high as 50 percent on the implants Dr. Fonn used. That income was used to benefit both Ms. Seeger and Dr. Fonn in the form of home improvements, a yacht, an airplane, and a number of other luxuries.

This exclusive arrangement resulted in large profits for the defendants at the cost of U.S. taxpayers, the whistleblower suit claimed. The Anti-Kickback lawsuit prohibits health care providers from making patient referrals in exchange for benefits. The law exists to ensure that patients are receiving the best and most cost-effective medical care instead of care that is driven by profit and personal enrichment.

The whistleblower case against Dr. Fonn and Ms. Seeger went to trial, which resulted in a federal jury handing down guilty verdicts, including a determination that the defendants return $1.65 million to the Medicare and Medicaid programs.

The court will also impose a statutory penalty of $5,500 to $11,000 for each of 228 alleged false claims, the U.S. Attorney’s office said, which will amount to a further recovery of $1.25 million to $2.5 million. The amount will be determined at a later date.

Dr. Fonn and Ms. Seeger escaped criminal prosecution a couple year ago after a federal grand jury handed down a four-count criminal indictment accusing them of one count of conspiracy to solicit and receive illegal kickbacks and three felony counts of anti-kickback violations.

Those charges were ultimately dropped without comment, however, after an attorney for the defendant met with the U.S. Attorney on several occasions.