Medtronic: Training Doctors Before the Evidence Was There

In the Medtronic False Claims Act case over SubQ stimulation, the company agreed to pay $2.8 million to resolve allegations that it caused physicians to bill Medicare and TRICARE for nonreimbursable procedures. The alleged connection ran through the device maker’s promotion and training of its physician-customers. For someone who knows what a sales team taught doctors, this case shows why the reimbursement story can start well before a physician sends a bill.

The Justice Department announced the civil settlement on February 6, 2015. Medtronic was a Minnesota-based medical technology company, and the whistleblower was a former Medtronic sales representative. The government alleged that the company knowingly caused dozens of physicians across more than 20 states to submit the claims from 2007 through 2011.

How SubQ Stimulation Reached Medicare and TRICARE

The Justice Department described SubQ stimulation as using Medtronic spinal cord stimulation devices just beneath the skin near an area of pain, most often in the lower back. The devices could deliver electrical impulses intended to produce a tingling sensation and relieve chronic pain.

According to the Justice Department, the safety and efficacy of SubQ stimulation had not been established as required by the Food and Drug Administration. The government described the procedures as investigational and said Medicare and TRICARE did not reimburse them. Yet Medtronic allegedly promoted the procedure and arranged for physician-customers to attend company-sponsored on-site training in using the devices for SubQ stimulation.

Medtronic allegedly trained customers to perform the procedure before its safety and effectiveness had been established as required. We see a sales effort moving ahead of the evidence patients needed. Instruction had outrun evidence, in the government’s account.

The government’s account puts patients seeking relief from chronic pain beside bills to Medicare and TRICARE for care those programs did not cover. The Justice Department’s Civil Division put the stakes plainly:

Why a Device Maker Can Answer for Physicians’ Claims

A device manufacturer can face a False Claims Act case for knowingly causing someone else to submit false claims. The False Claims Act reaches both submitting and causing the submission of a false claim. The physicians sent the bills. The government accused Medtronic of causing them.

Medtronic made the stimulation devices. The government alleged that it sponsored training for physician-customers who performed the procedures and submitted the reimbursement claims. In that account, Medicare and TRICARE were the programs asked to pay. The government’s case connected activity inside the manufacturer with billing outside it.

What the Evidence Has to Connect

The useful evidence connects the company’s decisions to the procedures and the claims. In a case about manufacturer-sponsored training, we examine what the company taught, which customers received that instruction, what procedures followed and how the resulting care was billed. We also examine what the company knew about the use it was promoting.

We read training materials and sales communications alongside procedure and billing records to connect what the manufacturer taught to what reached the government. That takes both an understanding of the product and an understanding of how the customer’s practice billed for its use.

What the company knew about the promoted use and reimbursement is part of the case we work through with you. The allegation against Medtronic was that it knowingly caused the claims.

Someone inside the sales operation may understand a training message that tells a billing employee very little. Someone in a physician’s practice may understand the procedure and payment request. A healthcare insider’s knowledge gives those documents their meaning.

A Sales Representative Brought the Case

A former Medtronic sales representative filed the whistleblower lawsuit resolved by the settlement. The person who brought the case worked on the manufacturer’s side of the customer relationship.

That origin matters to a reader whose knowledge sits inside a supplier. The alleged conduct reached physicians across state lines, but the sales representative’s view came from inside the company promoting the procedure. A manufacturer’s internal account of its sales effort can put otherwise separate customers’ claims in context.

The Justice Department credited a coordinated effort by the U.S. Attorney’s Office for the Western District of New York, the Civil Division’s Commercial Litigation Branch, the Department of Health and Human Services’ Office of Inspector General, the Defense Health Agency, and the FDA’s Office of Chief Counsel and Office of Criminal Investigations.

The Settlement and the Whistleblower’s Share

Medtronic agreed to pay the United States to resolve the allegations, and the Justice Department announced that the former sales representative would receive a share.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

What the Device Maker Can Know Before the Payer Does

An insider can explain what happened before a request for payment reached the government. In a device case, that earlier event may be a manufacturer’s decision about how to sell or use its product.

A separate manufacturer case illustrates the same reach through a different product. In the Quest Diagnostics and Nichols Institute Diagnostics resolution, the government alleged that inaccurate diagnostic kits caused downstream laboratory reimbursement claims and claims for unnecessary treatment. The connection there ran through the product’s diagnostic results. In the Medtronic case, the alleged connection ran through promotion and training for an investigational use. Both put the manufacturer’s role in the payment chain under scrutiny.

For a medical device insider, that is a useful way to describe what you saw: the company’s decision, the customer’s use of the product and the government claim that followed.

You Know What the Sales Team Taught

If you know how device training, sales instructions or reimbursement advice led to false health care claims, speak to one of our Whistleblower Experts about what the sales team taught. We work beside you to build your strongest medical device whistleblower case from that inside knowledge and bring in medical device whistleblower lawyers who understand manufacturer promotion and federal reimbursement. From the first conversation through the pursuit of a recovery, you have partners who can connect the sales operation to the claims it set in motion.