Chiropractor pays $2 million to settle false claims allegations for knee treatments

by Ben Vernia | April 10th, 2020

On April 6, the Department of Justice announced that a New Jersey chiropractor will pay $2 million to resolve allegations he submitted claims for medically unnecessary care and received kickbacks from a knee brace manufacturer. According to DOJ’s press release:

David Podell, a New Jersey chiropractor, has agreed to pay the United States $2 million to resolve False Claims Act allegations that he both knowingly billed Medicare for medically-unnecessary viscosupplementation injections and knee braces and that he received illegal kickbacks, the Justice Department announced today.  The settlement follows the government’s earlier settlement with seven former Osteo Relief Institutes (ORIs) and their owners, who agreed to pay the United States collectively more than $7.1 million to resolve their False Claims Act liability.   

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Podell previously owned and managed a clinic in Edgewater, New Jersey that performed viscosupplementation, among other procedures.  Along with a business partner, he also promoted a business model to other chiropractors for running and marketing a clinic that specialized in the treatment of osteoarthritis through the administration of fluoroscopic-guided viscosupplementation injections and the provision of knee braces.  This led to the formation of the ORIs.  Viscosupplementation is a treatment for osteoarthritis, in which a doctor injects a gel-like fluid into a patient’s knee joint to act as a lubricant and to supplement the natural properties of joint fluid.  Through his association with his business partner, Podell received a percentage of the ORIs’ collections. 

The government alleged that Podell caused his clinic and other ORIs to bill Medicare for viscosupplementation injections for patients who did not need them, to use multiple brands of viscosupplements successively on patients without clinical support, and to use discounted viscosupplements reimported from foreign countries.  The government also alleged that Podell caused his clinic and the ORIs to provide unnecessary custom knee braces to patients.  The government further alleged that Podell solicited and received kickbacks from a manufacturer of knee braces in exchange for ordering more of the manufacturer’s braces for his clinic.

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The case arose from a government investigation of claims data, the Department announced, and not from a whistleblower’s qui tam suit.

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