Titan Medical Compliance: Advice to Bill P-Stim as Surgery

The Titan Medical Compliance P-Stim complaint led to a $15,270,066 civil default judgment against the company and its owner over coding advice that caused providers to submit false claims for electro-acupuncture. The default judgment reached the consultant even though providers submitted the bills. The government’s case followed the billing instructions upstream: an office treatment reached federal insurers under codes for surgically implanted neurostimulators.

The Justice Department announced the outcome on November 3, 2022. The court entered judgment after Titan and its owner failed to respond.

P-Stim on the Patient, Surgery on the Claim

P-Stim could be applied in a few minutes in an office, without anesthesia, by someone with minimal training. The codes the government said its promoters recommended were for surgically implanted neurostimulators used to manage chronic pain, paying thousands of dollars per procedure.

The physical difference is plain in the Justice Department’s description of the device. An adhesive holds it behind the patient’s ear. Needles inserted into the ear deliver electrical stimulation. The single-use device runs on a battery for approximately four days, then is discarded.

Federal healthcare programs did not reimburse P-Stim, whether presented as electro-acupuncture or as an implantable neurostimulator. The Justice Department identified ANSiStim, Stivax, NeuroStim and NSS-2 Bridge among its other brand names. Changing the billing description put surgery on the claim without putting an implanted neurostimulator in the patient. Taxpayer-funded health programs were billed for surgery on patients treated with a disposable device attached behind the ear.

The Consultant Sold the Billing Instructions

Titan’s owner, a Wichita, Kansas chiropractor, marketed himself as a medical reimbursement consultant and Titan as a compliance consulting firm. According to the government’s October 14, 2021 complaint announcement, device marketers and distributors paid him monthly fees for coding recommendations to their customers. Some providers paid him directly.

The complaint alleged that he began promoting P-Stim as reimbursable in 2014, supplied instructions on which codes to bill, and knew the advice was incorrect because the device was acupuncture rather than a surgically implanted neurostimulator. The later judgment announcement also described an allegation that the devices were falsely promoted as approved by the Food and Drug Administration.

The complaint described reimbursement guidance as a paid service offered to businesses selling the device and to providers using it. A firm selling compliance advice was telling customers to bill an office treatment as surgery. The alleged knowledge matters: the government said the consultant knew the codes were wrong and continued recommending them.

How Does Reimbursement Work for Medical Devices?

For P-Stim, the reimbursement pitch depended on describing a different procedure. The government alleged that promoters sold providers on codes paying thousands for an implant, even though the treatment required no surgery. The promise of reimbursement helped sell the device.

FDA marketing authorization does not decide Medicare coverage. In Titan’s case, the government challenged both the reimbursement representation and the claimed FDA approval. Those were separate selling points, and neither changed what happened in the treatment room.

The Complaint’s Claims Value and the Judgment

The complaint alleged that the consultant caused providers to submit thousands of fraudulent claims to Medicare and TRICARE worth at least $20 million. The later judgment imposed the minimum civil penalties under the False Claims Act for approximately 1,200 false claims, rather than damages for the underlying claims.

The October announcement also reported settlements with Doc Solutions, Solace Advancement Institute and Baron, Inc., doing business as Access 2 Integration. Doc Solutions and its owner paid $1.15 million. The complaint announcement identified that owner as one of the marketers paying the consultant a monthly fee for recommendations to customers.

That relationship puts the advice inside the sale. In the government’s account, marketers paid for coding recommendations that reached the providers buying their devices. The government alleged that the promoters profited by conspiring to tell providers that P-Stim qualified for reimbursement. The product and the promise of payment traveled together.

The Same Billing Mismatch at Providers

In Tennessee, three providers agreed to pay a total of $1.72 million to resolve allegations involving P-Stim billing. The settlements announced on January 4, 2021 involved the owner of Affiliated Neurologists, Total Family Health & Wellness, and Chiro2Med of Tennessee.

The government alleged that they billed Medicare or TennCare under HCPCS code L8679 for the office-applied devices. As the announcement explained, that code required implantation of a neurostimulator with anesthesia in a surgical setting by a physician. The comparison supplies the provider end of the same problem: what was done in the office versus what the claim represented.

How Is Medicare Fraud Detected?

The national P-Stim investigation used healthcare claims analytics to identify improper billing. The Justice Department described collaboration with the Centers for Medicare & Medicaid Services, the Department of Health and Human Services Office of Inspector General, state partners and other federal prosecutors. The agency’s Unified Program Integrity Contractors also audited P-Stim claims and recovered improper payments.

The Titan case adds the person supplying the billing instructions to that picture. An insider who knows how the code reached the provider can explain the business decision behind the claim data.

What Evidence Is Needed to Prove Fraud?

Connecting the billing advice, the treatment, the claim and what the adviser knew is work we do with you. Titan’s complaint put both the paid recommendations and the consultant’s alleged knowledge of noncoverage at the center of the case.

The 2020 Journal of Forensic and Investigative Accounting article A Forensic Accountant’s Guide to the Most Potent Federal Laws Used Against Healthcare Fraud explains that a factually false claim can misstate the services rendered or goods provided. It also emphasizes whether a statement had the practical effect of inducing wrongful payment. In the government’s account of Titan, the false description started with the consultant and reached Medicare through providers’ bills.

For a device sales, reimbursement or billing insider, those connections are the substance we work through together. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Know Where the Code Came From

If you saw a device sold with billing instructions that described a different procedure, talk to our whistleblower experts about the advice behind the claims. We build the case with you, bring in medical device fraud whistleblower lawyers who understand reimbursement schemes, and stay with you throughout the case.