Consumer Fraud

Health Care Fraud Scheme Targeting TRICARE Ends in $7.6 Million Settlement

Pills Stethascope on Money 435x289 Health Care Fraud Scheme Targeting TRICARE Ends in $7.6 Million SettlementA California medical device company will pay the U.S. government $7.62 million to settle allegations it engaged in a health care fraud scheme targeting beneficiaries of TRICARE, the federal health care program for active-duty servicemembers and their families.

The U.S. Justice Department lodged a False Claims Act (FCA) complaint against Vista, California-based DJO Global and its subsidiary Empi Inc. of Shoreview, Minnesota, alleging that the medical device manufacturers carried out a health care fraud plan involving the sale of special electrodes used for pain.

According to the Justice Department, the medical device companies billed TRICARE for excessive and unnecessary transcutaneous electrical nerve stimulation (TENS) electrodes that they pushed onto patients who did not need or use them.

“Empi used inappropriate techniques such as ‘assumptive selling’ to persuade some TRICARE beneficiaries to seek and accept unjustifiably large quantities of TENS electrodes from 2010 through 2015, with a particularly steep increase in the number of beneficiaries receiving unnecessary quantities in 2014-2015,” the Justice Department said in a release about the health care fraud scheme.

Assumptive sales techniques consisted of Empi sales representatives contacting TRICARE beneficiaries and coaxing them to order excessive quantities of TENS electrodes by acting as though the beneficiaries had indicated a need for them when they actually hadn’t.

“This settlement demonstrates the commitment of the Defense Criminal Investigative Service (DCIS), along with our law enforcement partners, to aggressively pursue the waste, fraud, and abuse of Department of Defense and TRICARE resources,” said Special Agent in Charge Michael Mentavlos of the DCIS Southwest Field Office.‎

DJO Global announced it would shut down Empi in Nov. 2015. The subsidiary company ceased operations the following month.