Osteo Relief Institute Clinics in Six States Have Agreed to Pay $7.1 Million to Settle Medicare Fraud Claims Involving Medically Unnecessary Arthritis Treatments

The Osteo Relief Institute (“ORI”) was a network of clinics focused mainly on osteoarthritis treatments. The now-defunct clinics, located in Texas, Colorado, California, Kentucky, Arizona, and New Jersey, have agreed to pay a total of $7.1 million to settle allegations of Medicare fraud involving medically unnecessary knee braces and osteoarthritis treatments.

Osteo Relief Institute Clinics in Six States Have Agreed to Pay $7.1 Million to Settle Medicare Fraud Claims Involving Medically Unnecessary Arthritis Treatments

The settlement concludes an investigation prompted by a whistleblower lawsuit filed by a Kentucky resident. After reviewing records of the clinics’ Medicare billings, the government decided to join the lawsuit and prosecute the ORI clinics and their owners. Under the False Claims Act, whistleblowers are entitled to a share of the recoveries resulting from a fraud investigation carried out with their assistance. In this case, the tipster will receive a $858,000 award.

The alleged misconduct, in this case, involves a procedure used in the treatment of arthritis called viscosupplementation. Though it is not a cure, viscosupplementation can relieve pain and swelling in affected joints, usually the knees. The procedure consists of an injection of hyaluronic acid directly into the joint.  

Prosecutors alleged that medical professionals at the ORI clinics performed viscosupplementation on patients who did not need them. The complaint further states that the defendants often used a combination of different viscosupplements, including foreign-made discount drugs, that were not supported by clinical studies. 

Prosecutors also stated that Osteo Relief Institute professionals provided numerous patients with unnecessary knee braces. Medicare reimbursed the clinics for the majority of these treatments.

To resolve the Medicare fraud allegations, the clinics located in Phoenix, AZ, San Diego, CA,  Lexington, KY, Wall Township, NJ, Dallas, TX, and San Antonio, TX will pay $1 million each. On the other hand, the Colorado Springs clinic has agreed to pay $1.13 million.

When the multi-million-dollar settlement was announced, the U.S. Attorney for the District of Minnesota said in a press release, “Providers who bill the Medicare system must do so in a manner that is consistent with good patient care. When individuals and entities permit financial motivation to cloud their judgment, our office is committed to addressing these abuses. We very much appreciate the tireless investigative efforts of our law enforcement partners at the Federal Bureau of Investigation and Health and Human Services in pursuing this nationwide investigation.”

For the U.S. Attorney for the Eastern District of Kentucky, “This settlement demonstrates that the U.S. Attorney’s Office will continue to identify and hold accountable those healthcare providers who improperly bill medically unnecessary services,” and “It is also an example of [the government’s] commitment” to identify fraudsters and to “work with whistleblowers, who play a critical role in helping keep entities honest, and are encouraged to report suspected waste, fraud, and abuse by those billing federal programs.”

For OIG Special Agent Lamont Pugh, “Providing unnecessary care in an effort to increase profits is illegal and may put patients at risk.” Although the OIG has entered into a five-year compliance agreement with the government as part of the settlement, the clinics appear to have ceased operations.

A patient writing on ComplaintsBoard a few years ago said about ORI’s San Diego clinic, “This is a scam. They are Chiropractors. They do have an MD and an NP, but chiropractors run it. They want to get you in, give you injections, sign you up for physical therapy, and milk your insurance. This is not state of the art. In fact, you can go to any primary care doctor and get the same injection. There is nothing special that this "institute" provides. Stay clear and just go see your primary care doc.”

In September 2018, the clinic’s M.D., Dr. Daniel E. Weinstein, wrote in the same forum, “The services provided here are indeed state-of-the-art. We utilize viscoscupplements (Hyalgan, etc.) as opposed to steroids. All of our injections are performed personally by me, under fluoroscopic guidance. . . We do not offer physical therapy; accordingly, we do not "sign you up" or milk your insurance.”

The San Diego clinic was not the only ORI location with a bad reputation. Two years ago, over 40 patients of the ORI’s New Jersey clinic became infected with dangerous bacteria after receiving viscosupplement injections. A government investigation found that the clinic’s professionals were reusing single-use vials dozens of times and that some doctors failed to wash their hands between patients.  

Over the last couple of years, the Medicare Fraud Strike Force has been cracking down on dishonest healthcare companies like ORI all over the country. During the first half of 2018, 11 active  Medicare fraud cases involved defendants who had pleaded guilty, been convicted, or been sentenced. This is a clear sign that the DOJ will no longer be satisfied with financial settlements, and that more convictions are to be expected in connection with Medicaid and Medicare fraud.  

Whistleblowers are the New American Heroes

If you simply want to remain anonymous and aren’t interested in a reward, feel free to call 1-800-MEDICARE. If the case only involves Medicaid, you can contact your state Medicaid Fraud Control Unit as well.

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