Case 4:21-cv-00784 Document 1 Filed on 03/10/21 in TXSD Page 1 of 34
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF TEXAS
`HOUSTON DIVISION
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`UNITED STATES OF AMERICA,
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`Plaintiff,
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`v.
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`CIVIL ACTION NO.
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`SUHYUN AN, JOHNSON MEDICAL GROUP
`PLLC (d/b/a Campbell Medical Clinic), and
`CAMPBELL MEDICAL GROUP PLLC,
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`Defendants.
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`COMPLAINT OF THE UNITED STATES OF AMERICA
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`1.
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`The United States of America (“United States”) brings this action to recover treble
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`damages and civil penalties arising from violations of the Federal False Claims Act, 31 U.S.C.
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`§ 3729, et seq. (“FCA”), and to recover damages under the common law theories of fraud, unjust
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`enrichment, and payment by mistake.
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`I.
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`INTRODUCTION
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`2.
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`Suhyun An is a chiropractor and nurse practitioner who manages the Campbell
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`Medical Clinic in the Spring Valley village in Houston. In addition to traditional chiropractic
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`services, Campbell Medical Clinic advertises that it offers “regenerative medicine” and a host of
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`cosmetic treatments such as Botox, Vampire Facelifts, and assorted other services.
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`3.
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`In late 2015, An learned of an enticing money-making opportunity. The proposal:
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`buy cheap devices for a few hundred dollars each (an inflated price justified only by the devices’
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`reimbursement potential), tape them to patients’ ears, submit a $10,000 claim to Medicare for each
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`service, and receive well over $6,000 in reimbursement for every claim.
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`Case 4:21-cv-00784 Document 1 Filed on 03/10/21 in TXSD Page 2 of 34
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`4.
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`There was a catch, though. In order to garner the sky-high reimbursement rates,
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`An had to bill Medicare and other insurance programs using code L8679, a very expensive code
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`reserved for “implantable” neurostimulators where surgery had been performed.
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`5.
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`Here, however, the devices were not “implantable” and did not require surgery.
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`Rather, the devices were simply taped to a patient’s ear using an adhesive. The only things that
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`went into a patient’s body were the electrodes that were inserted into the patient’s ear—barely
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`penetrating the skin—and affixed using another adhesive. Those electrodes were powered by
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`small batteries (e.g., a 9-volt Duracell) and would generate intermittent stimulation by electrical
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`pulses.
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`6.
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`As an illustration, below is a photo of the ANSiStim, one of the various devices
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`used by An.1
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`7.
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`Although An bought similar devices from competing manufacturers, all of them
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`were functionally identical and were commonly referred to as “p-stim” (percutaneous stimulation)
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`devices. (“P-STIM” was also the brand name of one of the devices.)
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` 
`1
`Press Release, New DyAnsys Inc. Solution Relieves Long-Term Chronic Pain Without Narcotics,
`PRNEWSWIRE.COM (available at https://www.prnewswire.com/news-releases/new-dyansys-inc-solution-
`relieves-long-term-chronic-pain-without-narcotics-300085673.html) (last accessed May 5, 2020).
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`2
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`8.
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`In truth, these devices were simply providing electric acupuncture. Various brands
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`of the p-stim devices were cleared by the Food and Drug Administration (“FDA”) as electro-
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`acupuncture stimulator devices for use by licensed acupuncturists. Because acupuncture was not
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`covered by Medicare, the devices were not reimbursable at all.
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`9.
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`Nevertheless, An took full advantage of the opportunity to earn fraudulent
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`reimbursement. Acting through Johnson Medical Group PLLC, an entity she set up to fraudulently
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`bill Medicare with the help of a physician in Houston, An submitted at least 666 claims to the
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`Medicare program using L8679 and received at least $3,886,119.06 in reimbursement. She also
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`submitted 31 claims and received at least $50,105.47 from TRICARE, an entitlement program for
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`uniformed service members, retirees, and their families around the world.
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`10.
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`An’s conduct violated the FCA, which is designed to penalize parties who defraud
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`the federal government. The FCA provides that the government may recover treble damages and
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`substantial monetary penalties whenever someone submits false claims to the federal government
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`with, among other things, “reckless disregard” for the truth or falsity of those claims.
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`11.
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`Consistent with ordinary common sense, An’s emails show that she actually knew
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`(or, at minimum, recklessly disregarded) that Medicare did not treat p-stim devices as implantable
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`neurostimulators worthy of reimbursement of approximately $6,500 to $8,000 per claim. In fact,
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`she expressed concerns right when she heard of the scheme, writing in emails that she was “reading
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`conflicting information on [the] legality of billing [p-stim] to different payor[s], including
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`Medicare.”
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`12.
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`The sales representatives marketing to An—who stood to gain from this scheme—
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`put her in touch with consultants who told her how she could bill to garner the highest possible
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`reimbursement. An determined to bill Medicare using L8679 after learning that, so far, many other
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`3
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`doctors had gotten away with it. In an email to her billing company, An noted that she would
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`submit what she called “a test run” of a claim to Medicare to see if it would be paid.
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`13.
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`An knew this billing scheme was highly suspect. Indeed, right after the “test” claim
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`was paid, she wrote in an email that, while she could make a lot of money billing p-stim devices,
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`she wanted to utilize a goldilocks approach—billing enough to make significant money but not
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`overdoing it so that she could “fly under the audit radar.”
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`14.
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`In fact, on multiple occasions, An was warned by her staff, her billing company,
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`and even her then-husband who worked at the clinic that p-stim devices were not billable as
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`implantable neurostimulators and that she was likely committing fraud. She was even pointed
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`directly to the guidance of a Medicare contractor stating that these devices were not payable.
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`Nevertheless, she continued billing—sometimes for as many as 11 devices per patient.
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`15.
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`An took other steps to evade scrutiny. She and her clinic staff did not attempt to
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`collect from patients the co-pay charge of approximately $1,600 that Medicare assigned to L8679
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`claims. She did this to avoid raising alarms with patients, who would have been livid upon learning
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`how much they were charged. (Nevertheless, some patients did in fact raise concerns.)
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`16.
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`An’s fraud scheme allowed her to live a lavish lifestyle. She used the proceeds of
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`this fraud to buy multiple luxury cars, real estate properties, and a million-dollar house in a high-
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`end Houston neighborhood.
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`17.
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`Ultimately, An and the Campbell Medical Clinic did not stay off the government’s
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`“audit radar” and the government commenced an investigation into her practices. The government
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`now seeks to recover all of the money paid to Defendants, plus treble damages and statutory
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`penalties as provided for under the FCA.
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`4
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`II.
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`JURISDICTION AND VENUE
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`18.
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`This action arises under the False Claims Act (“FCA”), 31 U.S.C. §§ 3729 to 3733,
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`and the common law. This Court has subject matter jurisdiction over the entire action, including
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`claims asserted under the common law, under 28 U.S.C. § 1345 because the United States is the
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`Plaintiff. In addition, the Court has subject matter jurisdiction over the FCA causes of action under
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`28 U.S.C. § 1331.
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`19.
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`The Court has personal jurisdiction over the Defendants pursuant to 31 U.S.C.
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`§ 3732(a) because the Defendants reside and/or transact business in the Southern District of Texas.
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`20.
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`Venue is proper in the Southern District of Texas under 31 U.S.C. § 3732(a) and
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`28 U.S.C. § 1391(b) and (c) because Defendants reside and conduct business in this district and
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`most of the events giving rise to these claims occurred in this district.
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`III.
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`PARTIES
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`21.
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`Plaintiff United States brings this action on behalf of (a) the United States
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`Department of Health and Human Services (“HHS”), including HHS’s component agency, the
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`Centers for Medicare and Medicaid Services (“CMS”), which administers the Medicare and
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`Medicaid programs; and (b) the Department of Defense, including its component, the Defense
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`Health Agency (“DHA”), which administers the TRICARE Program.
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`22.
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`Defendant Suhyun An (“An”) is a chiropractor and nurse practitioner who practices
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`in Houston, Texas. At all times relevant to this complaint, she has been an owner of Campbell
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`Medical Group PLLC and has managed Johnson Medical Group PLLC.
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`23.
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`Defendant Johnson Medical Group PLLC (d/b/a Campbell Medical Clinic)
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`(“Johnson Medical”) is an entity that was used as a vehicle by An to bill Medicare, including for
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`the p-stim claims at issue in this Complaint. An submitted forms to Medicare representing that
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`Dr. Cheryl Johnson, a physician from West Houston, was the sole owner of Johnson Medical.
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`However, although Dr. Johnson signed documents indicating that she was nominally the legal
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`owner, An managed the entity and controlled the Medicare revenues it received. Dr. Johnson was
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`instead paid a monthly fee for serving as a medical director.
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`24.
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`Defendant Campbell Medical Group PLLC (“Campbell Medical”) is An’s primary
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`chiropractic practice. It is located at 1012 Campbell Road, Houston, TX 77055. An took the funds
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`that were paid to Johnson Medical and diverted them to Campbell. An then took large distributions
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`from Campbell to fund her lifestyle.
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`IV.
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`LEGAL AND REGULATORY BACKGROUND
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`A. The False Claims Act
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`25.
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`The FCA prohibits knowingly presenting, or causing to be presented, to the United
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`States government a false or fraudulent claim for payment or approval. 31 U.S.C. § 3729(a)(1)
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`(1986), and 31 U.S.C. § 3729(a)(1)(A) (2009).2 In addition, the FCA prohibits knowingly making,
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`using, or causing to be made or used, a false record or statement material to a false or fraudulent
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`claim. 31 U.S.C. § 3729(a)(1)(B). The FCA further prohibits knowingly concealing or knowingly
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`and improperly avoiding or decreasing an obligation to pay or transmit money back to the Federal
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`Government. 31 U.S.C. § 3729(a)(1)(G).
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`26.
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`The term “knowingly” under the FCA means that a person, with respect to
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`information, (i) has actual knowledge of the information, (ii) acts in deliberate ignorance of the
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`truth or falsity of the information, or (iii) acts in reckless disregard of the truth or falsity of the
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`2
`Congress amended the FCA as a part of the Fraud Enforcement Recovery Act of 2009 on May 20,
`2009, making certain amendments retroactive, including 31 U.S.C. § 3729(a)(1)(B). Congress amended the
`FCA again as part of the Patient Protection and Affordable Care Act on March 23, 2010.
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`information. 31 U.S.C. § 3729(b). No proof of specific intent to defraud is required to show that
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`a person acted knowingly under the FCA. Id.
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`27.
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`The FCA provides that any person who knowingly presents or causes to be
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`presented, a false or fraudulent claim for payment or approval is liable for a civil penalty of up to
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`$22,363 per each such claim,3 plus three times the amount of the damages sustained by the United
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`States.
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`B. Part B of the Medicare Program
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`28.
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`In 1965, Congress enacted the Health Insurance for the Aged and Disabled Act,
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`which created Medicare. 42 U.S.C. § 1395, et seq. Medicare is a federal health care program
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`providing benefits to persons who are over the age of 65 and some under that age who are blind or
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`disabled.
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`29.
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`The regulations implementing Medicare are found at 42 C.F.R. § 405, et seq. Part
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`B of Title XVIII of that Act (42 U.S.C. §§ 1395j-1395w), commonly referred to as the “Medicare
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`Part B Program” (Part B), is administered by the United States through HHS and its component
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`agency, CMS. Part B is a federally-funded national health insurance program providing medical
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`insurance protection for covered services to any person 65 years of age or older or to certain
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`disabled patients. Benefits are paid on the basis of reasonable and necessary charges for covered
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`services furnished by physicians and other suppliers of medical services.
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`30.
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`CMS contracts out the adjudication of claims and the distribution of benefits under
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`Part B to private carriers under 42 U.S.C. § 1395u. In Texas, Novitas Solutions Inc. is the carrier
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`that adjudicated and paid Part B claims submitted by the Defendants.
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`3
`See 85 Fed. Reg. 37004, 37006. (June 19, 2020 inflation adjustment for FCA penalties applicable
`to post-2015 conduct).
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`31.
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`In order to submit claims to Medicare, and to be paid from the Medicare trust fund,
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`providers must file a provider agreement with the Secretary of HHS. 42 U.S.C. § 1395cc. The
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`agreement, the Medicare Federal Health Care Provider/Supplier Enrollment Application, CMS
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`Form 855B, contains a certification statement in which the provider agrees, inter alia, that he or
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`she (a) will abide by Medicare laws, regulations and program instructions, (b) understands that
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`payment of a claim is conditioned upon the claim and the underlying transaction complying with
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`such laws, regulations, and program instructions, and (c) will comply with all applicable conditions
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`of participation in the Medicare program. The provider also agrees not to knowingly present or
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`cause to be presented a false or fraudulent claim for payment to Medicare, and will not submit
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`claims with deliberate ignorance or reckless disregard of their truth or falsity.
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`32.
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`In October 2015, Johnson Medical submitted a signed CMS Form 855B containing
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`these representations. This form was signed by Dr. Cheryl Johnson (“Dr. Johnson”), a physician
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`who served as the medical director for Campbell.
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`33.
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`This form, and others, falsely indicated that Dr. Johnson was the sole owner of
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`Johnson Medical. This misrepresentation was aimed to ensure that Johnson Medical could bill
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`Medicare for a greater range of services than those that could be billed just by practicing
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`chiropractors.
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`34.
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`In reality, though, An managed the entity and controlled the profits it earned.
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`35. While An did not sign the CMS Form 855, she caused its submission. The form
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`was shipped via FedEx on October 28, 2015 with an envelope showing that it was being sent from
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`“Suhyun An” with a return address of “1012 Campbell Rd, Houston, TX 77055.”
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`36.
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`In addition, Johnson Medical submitted claims for reimbursement to Medicare
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`electronically by computer via phone lines. Johnson Medical was required to identify the
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`beneficiary, specify the date the services were performed, describe the services performed, and
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`specify the charge for the services performed. An, along with her staff and outside billing
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`company, participated in and directed this process and caused the submission of these claims.
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`C. Medicare’s Medical Necessity Requirements and Coding Processes
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`37. Medicare reimburses only those services that are “reasonable and necessary.” 42
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`U.S.C. § 1395y(a)(1)(A). Part B providers also must certify that services are medically necessary.
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`42 C.F.R. § 424.24(g)(1). In submitting claims to Medicare, providers must certify that the
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`information on the claim form presents an accurate description of the services rendered and that
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`the services were reasonably and medically necessary for the patient. Providers must also ensure
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`that the services they furnish meet professionally recognized standards of care. 42 U.S.C. § 1320c-
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`5(a)(2).
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`38.
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`To identify the services performed during an office visit, Medicare requires the
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`provider to use standardized numerical procedure codes known as CPT (“Current Procedure
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`Terminology”) and Healthcare Common Procedure Coding System (“HCPCS”) codes.
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`39.
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`Providing accurate CPT and HCPCS codes on claims submission forms is material
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`to and a condition of payment for federal health care programs such as Medicare. See, e.g.,
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`Medicare Learning Network Fact Sheet, Medicare Billing: 837P and Form CMS-1500.
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`40.
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`These codes are used by Medicare and its contractors to determine whether a
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`service qualifies for Medicare coverage at all, and, if so, how much should be paid to the provider.
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`CMS and its contractors routinely deny payment to providers who bill for codes when the criteria
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`for those codes is not actually met, including when the services are not medically necessary. In
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`addition, CMS assigns different reimbursement amounts to CPT and HCPCS codes to reflect the
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`services provided.
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`41.
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`CMS and its contractors have issued directives concerning what is, or is not,
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`medically reasonable and necessary and therefore billable.
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`42.
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`At the highest level, CMS promulgates National Coverage Determinations
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`(“NCD”), which are determinations of national application by CMS “granting, limiting or
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`excluding Medicare coverage for a specific medical [item] or service.” 68 Fed. Reg. 55634 at
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`55635; see also 42 C.F.R. § 405.1060 (stating that the promulgation of an NCD “is a determination
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`by the Secretary of whether a particular item or service is covered nationally under Medicare”).
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`43. Medicare contractors such as Novitas, each of which have jurisdiction over
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`particular regions, also issue guidance documents, called “Local Coverage Determinations”
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`(“LCDs”) or “Local Coverage Articles (“LCAs”), to address whether it is medically proper to bill
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`under certain codes.
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`D. The TRICARE Program
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`44.
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`TRICARE (formerly CHAMPUS) is a federally funded entitlement program for
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`uniformed service members, retirees, and their families around the world. 10 U.S.C. §§ 1071 to
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`1110. TRICARE provides health care benefits to eligible beneficiaries.
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`45.
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`The regulatory authority
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`implementing
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`the TRICARE program provides
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`reimbursement to health care providers applying the same reimbursement scheme and coding
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`parameters that the Medicare program applies. For example, TRICARE, like Medicare, pays only
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`for “medically or psychologically necessary services and supplies required in the diagnosis and
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`treatment of illness and injury.” 32 C.F.R. § 199.4(a)(1)(i).
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`46. Under the TRICARE for Life program, there are beneficiaries who are enrolled in
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`Medicare and are still eligible for TRICARE (“dual eligible beneficiaries”). For these dual eligible
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`10
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`beneficiaries, TRICARE is the secondary payor to Medicare. 10 U.S.C. § 1086(d); 32 C.F.R.
`§ 199.17(a)(6)(ii)(c).
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`47.
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`TRICARE considers “[b]illings or CHAMPUS claims which involve flagrant and
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`persistent overutilization of services without proper regard for results, the patient's ailments,
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`condition, medical needs, or the physician's orders” to be fraud. 32 C.F.R. § 199.9(c)(3).
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`TRICARE also deems fraudulent any “misrepresentations of dates, frequency, duration, or
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`description of services rendered[.]” 32 C.F.R. § 199.9(c)(6). Such practices are deemed abusive
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`and cause financial loss to the United States.
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`48.
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`In June 2012, Johnson Medical Group also submitted a provider certification form
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`to Wisconsin Physician Services, the contractor responsible for administering TRICARE for Life.
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`This form, which was signed by Dr. Cheryl Johnson, included a representation that “[i]t is
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`understood[] and agreed that claims will be submitted for services which are medically indicated
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`for the proper care of the patient, and the services (where provided by other than a physician or a
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`dentist) were ordered by the attending physician or dentist and that the services were actually
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`furnished.” It also included a representation that “I also understand that the making or conspiring
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`to make a false, fictitious, or fraudulent claim against the United States or one of its Fiscal
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`Administrators renders such person liable to prosecution under applicable federal law.”
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`V.
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`FACTUAL ALLEGATIONS
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`A.
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`An and Campbell Medical Clinic Falsely Submitted Claims for Electroacupuncture
`Using an Expensive HCPCS Code for “Implantable” Neurostimulators
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`49.
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`An submitted and caused the submission of false claims to Medicare and TRICARE
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`by billing for the use of “p-stim” devices and obtaining millions of dollars in improper
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`reimbursements. This billing was false for two reasons.
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`11
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`50.
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`First, An billed using a code designated specifically for “implantable” devices
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`when nothing was implanted into patients and no surgery was performed. Second, the p-stim
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`devices were not billable at all, as they were just acupuncture—which was not covered by
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`Medicare at the time because it was not medically reasonable or necessary.
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`i. HCPCS code L8679 is restricted to the use of “implantable” devices,
`and does not cover p-stim devices
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`51.
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`HCPCS code L8679
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`is defined as
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`the application of an “implantable
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`neurostimulator, pulse generator, any type.” It is a bundled code, meaning that the code is intended
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`to reimburse the provider for both the surgery to implant the device and the device itself.
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`52.
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`HCPCS code L8679 is typically billed by providers at around $8,000 to $10,000.
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`After making adjustments, CMS typically reimburses providers with approximately $6,300 to
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`$6,500 per submission. If a patient has supplemental TRICARE for Life coverage (often by virtue
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`of their past military service), TRICARE would pay approximately $1,600 more to cover the
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`patient’s co-pay.
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`53.
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`These extremely high reimbursement rates reflect the fact that a true “implantable”
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`device is often expensive, and the implantation of such a device involves surgery.
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`54.
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`For decades, CMS has unequivocally defined what constitutes an implantable nerve
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`stimulator. In fact, the NCD for Electrical Nerve Stimulators (160.7), which went into effect on
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`August 7, 1995, stated in no uncertain terms that surgery was required:
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`Payment may be made under the prosthetic device benefit for implanted peripheral
`nerve stimulators. Use of this stimulator involves implantation of electrodes around
`a selected peripheral nerve. The stimulating electrode is connected by an insulated
`lead to a receiver unit which is implanted under the skin at a depth not greater than
`1/2 inch.
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`Stimulation is induced by a generator connected to an antenna unit which is
`attached to the skin surface over the receiver unit. Implantation of electrodes
`requires surgery and usually necessitates an operating room.
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`12
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`NCD 160.7 (NCD for Electrical Nerve Stimulators) (emphasis added).
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`55.
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`A subsequent NCD, issued in 2006, provided further guidance with respect to
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`transcutaneous electrical nerve stimulation (“TENS”) and percutaneous electrical nerve
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`stimulation (“PENS”). NCD 160.7.1 (NCD for Assessing Patient’s Suitability for Electrical Nerve
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`Stimulation Therapy). For TENS, the device is attached “to the surface of the skin over the
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`peripheral nerve to be stimulated” and “is used by the patient on a trial basis.” Id. For PENS, the
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`diagnostic procedure involves a “needle electrode inserted through the skin” and is “covered only
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`when performed by a physician or incident to physician’s service.” Id.  Both TENS and PENS are
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`intended to be used on a trial basis, typically for one month, to determine whether an actual
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`implanted nerve stimulator would provide therapeutic benefit. Id. TENS and PENS are also billed
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`to Medicare using different codes that pay lower reimbursement rates than L8679.
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`56.
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`That same NCD makes it clear that in-office treatments would not be reimbursable
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`as PENS or TENS, much less for codes relating to “implantable” devices: “Electrical nerve
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`stimulation treatments furnished by a physician in his/her office, by a physical therapist or
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`outpatient clinic are excluded from coverage by § 1862 of [the Medicare Act].” NCD § 160.7.1
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`(emphasis added).
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`57.
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`In stark contrast, the p-stim devices used by An and Campbell Medical Clinic came
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`nowhere close to even resembling genuine “implantable” neurostimulators.
`
`58.
`
`For example, documents indicate that An ordered and used devices such as the P-
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`Stim, NSS, AnsiStim, Stivax, and Primary Relief.
`
`59.
`
`All of these devices are functionally identical and work the same way by applying
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`electric shock to patients’ ears in a process known as electro-acupuncture.
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`60.
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`The devices resemble a hearing aid and do not require “implantation.” Instead, a
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`provider affixes three small electrodes into a patient’s ear and tapes the device to the skin. This
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`process of attaching the p-stim device to a patient’s ear took only a few minutes, and no anesthesia
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`or surgery of any kind was required. The devices were typically worn by patients for a few days,
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`or a few weeks, and then thrown away. Patients could not shower with the devices on their ears,
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`lest they get wet and fall off.
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`61.
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`The devices were typically applied by nurse practitioners who worked at Campbell
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`Medical Clinic. Nurse practitioners cannot independently perform surgery.
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`62.
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`Indeed, it was so clear that no surgery was being performed that some patients were
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`appalled when they received explanation of benefits (EOB) forms containing thousands of dollars
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`in charges to the Medicare program. Some of those patients even contacted Medicare to report
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`that they believed that An and Campbell Medical Clinic were committing fraud. (As outlined
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`below, see infra ¶ 83, An worked to limit these complaints by not attempting to collect from
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`patients the substantial co-pay associated with the procedure.).
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`63.
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`The medical records similarly indicate that surgery was not performed. There was
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`no record that patients underwent general anesthesia or any actual operation. Rather, the
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`application of the p-stim devices to patients’ ears was misleadingly described as a “procedure” and
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`hyper-technical language was used to make it seem more complicated than in reality.
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`64.
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`This exaggeration in the medical records was intentional. An sought the assistance
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`of consultants to assist in preparing “SOAP notes” (an acronym for medical records) that could be
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`copied and pasted over and over into patient records, and emails with these consultants indicate
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`that she attempted to “bolster” these notes so that claims would be paid.
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`65.
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`Along those same lines, she emailed her fellow chiropractor (and then-husband)
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`Daniel Ybarra in January 2016 to ask that these SOAP notes be modified to obscure the treatment
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`that was being provided. In this email, she indicates that the use of the term “p-stim” in medical
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`records could be problematic. Instead, she attempts to use the more technical (and scientific-
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`sounding) term “percutaneous electrical stimulator.”
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`
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`ii.
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`The P-stim devices are not covered by Medicare at all, as they simply
`provide acupuncture
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`66.
`
`As outlined above, the devices used by Defendants were not “implantable” and
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`therefore did not qualify for reimbursement under HCPCS code L8679. However, their billing
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`was improper for a separate and independent reason. Specifically, the p-stim devices were not
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`reimbursable from Medicare at all, as they were used only for acupuncture and were not medically
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`reasonable or necessary.
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`67.
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`Up until 2020, Medicare did not cover acupuncture treatments because acupuncture
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`is not a medically necessary treatment. This was a longstanding determination that, like the
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`determination of what counts as an “implantable” device, had been in place for decades. Only
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`recently, in January 2020, did CMS allow limited coverage for acupuncture. That limited coverage
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`was not in place at the time Defendants billed for p-stim. In addition, it applies only where a
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`patient has lower back pain, and it in no way authorizes the use of separate and inapplicable codes
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`like L8679.
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`68.
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`At the time Defendants submitted the claims at issue in this case (2016 to 2018),
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`the then-applicable NCD for acupuncture (30.3) stated that acupuncture was “of unknown use and
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`efficacy” and therefore not deemed to be medically reasonable and necessary.
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`Although acupuncture has been used for thousands of years in China and
`for decades in parts of Europe, it is a new agent of unknown use and efficacy
`in the United States. Even in those areas of the world where it has been
`widely used, its mechanism is not known.
`
`[. . .]
`
` Until the pending scientific assessment of the technique has been
`completed and its efficacy has been established, Medicare reimbursement
`for acupuncture, as an anesthetic or as an analgesic or for other therapeutic
`purposes, may not be made. Accordingly, acupuncture is not considered
`reasonable and necessary within the meaning of § 1862(a)(1) of the Act.
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`NCD 30.3 (Acupuncture) (emphasis added).
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`69.
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`This guidance was easy to find. For example, below is a screenshot of a page on
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`Medicare’s website from at least 2018 to January 2020.4
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`
`
` 
`4
`https://web.archive.org/web/20200106212721/https://www.medicare.gov/coverage/acupuncture
`(Wayback machine capture showing a screenshot from January 6, 2020).
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`70.
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`In case there was any doubt, the Medicare contractor responsible for overseeing
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`Medicare billing in Texas, Novitas, issued specific guidance in August 2016 stating that p-stim
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`devices (including those used by Defendants) would not qualify for payment of any kind. In a
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`local coverage article (“LCA”), Novitas stated that:
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`
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`
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`“It has come to Novitas’ attention that auricular peripheral nerve stimulation has
`been billed to Medicare using the CPT code 64555. CPT code 64555 is described
`as: Percutaneous implantation of Neurostimulator electrode array; peripheral
`nerve (excludes sacral nerve).
`
`[. . . ]
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`The following devices are listed under the Food and Drug Administration (FDA)
`approval documents as electro-acupuncture devices used for stimulation of
`auricular acupuncture points and as such are non-covered by Medicare in that
`Acupuncture is not a covered Medicare benefit:
`
` NeuroStim system/NSS
` P-stim
` ANSiStim
` E-Pulse”
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`Local Coverage Article A55240 (Auricular Peripheral Nerve Stimulation (Electro-Acupuncture
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`Device) (emphasis added).
`
`71.
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`Although the article applied to another code, 64555, it provided clear guidance that
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`devices like the ANSiStim should not be billed to Medicare at all and were not reimbursable
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`because they simply provided “electro-acupuncture” and “Acupuncture [was] not a covered
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`Medicare benefit.”
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`72.
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`An cannot claim that she simply did not know this guidance existed. Rather, as
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`outlined below, infra ¶ 100, An was specifically made aware of this guidance (including the LCA)
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`yet chose to ignore it and continue billing.
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`B. An Knew (Or, At a Minimum, Recklessly Disregarded) Her Billing Was
`Improper, Yet She Sought to Earn as Much Money as Possible
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`73.
`
`As explained above, supra ¶ 26, the FCA applies whenever someone submits false
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`claims to the federal governme