National Spine & Pain Center and PMA: Research Pay for Someone Else’s Work

National Spine & Pain Center’s settlement over the Proove payments was a criminal non-prosecution agreement over Medicare kickbacks paid under the guise of clinical research. In that agreement, National Spine & Pain Center admitted that it and Physical Medicine Associates entered an arrangement in which Proove Biosciences unlawfully paid physicians.

The Department of Justice’s August 6, 2021 announcement describes what those payments bought. For someone who handled the study paperwork, physician compensation or laboratory relationship, the important comparison is between the work the timesheet claimed and the work anyone actually did.

What PMA Received From Proove

PMA received $1.1 million from Proove. Medicare paid Proove approximately $4 million for claims arising from referrals by National Spine & Pain Center and PMA physicians, according to the announcement.

PMA is Physical Medicine Associates, Ltd., an affiliate of National Spine & Pain Center. National Spine & Pain Center was a physician management services organization headquartered in Rockville, Maryland. Proove was a genetics testing company formerly based in Irvine, California, and was defunct by the announcement.

Research Timesheets for Work Someone Else Did

National Spine & Pain Center admitted that certain physicians at its practices and PMA described Proove’s clinical research payments as payments “per test” or “per patient.” That language put the testing activity at the center of what the physicians expected to receive.

The paperwork described time spent on research. The company admitted that physicians completed timesheets used by Proove to pay them, and that those timesheets overstated the time spent conducting the related research. The government’s account of the admissions goes further:

That is a concrete discrepancy for a study coordinator or practice employee to recognize. The person working alongside the laboratory’s staff may know who completed a task. The person reviewing compensation may see whose name claimed it. Put those accounts together and the research payment has a very different explanation from the one on the form.

More Testing Sites Depended on Keeping Physicians Paid

National Spine & Pain Center also admitted that certain personnel told Proove the company would not offer Proove’s genetic tests at additional sites unless Proove was current on payments to its physicians and PMA physicians. Proove, in turn, communicated that it expected those physicians to order a certain volume of tests.

For someone responsible for a laboratory relationship, that conversation can be more revealing than the agreement’s description of a study. The condition for expansion was catching up on physician payments.

Genetic Tests Marketed to a Pain Practice

Proove’s genetic tests purported to assess a patient’s risk of abusing certain prescription opioids and how patients metabolized certain drugs. Those claims placed the product directly in the work of a pain practice.

Test volume also leaves an operational record. Model Plan Helps Laboratories Fight Fraud, published in Laboratory Medicine in 1997, described the Office of Inspector General’s recommendation to retain and analyze test-use data. Alongside payment communications, an order history can show whether referrals changed when research payments fell behind. That is a comparison an insider’s account can make meaningful.

Do Doctors Get Kickbacks for Ordering Tests?

Doctors can receive kickbacks for test referrals, and National Spine & Pain Center admitted that Proove unlawfully compensated physicians through this clinical research arrangement. The Department of Justice explains in its announcement that the Anti-Kickback Statute reaches both those paying for federally reimbursed referrals and those receiving the payments.

In some cases, physicians drew research pay for work Proove’s own staff did, while Medicare paid for the tests. The health care decision had acquired a price for the person making the referral. Honest laboratories competing for those referrals faced a rival paying the people who could send them.

Other Laboratories Used Different Forms of Referral Pay

A separate clinical-study case shows why the description attached to a payment deserves attention. In the Primex Clinical Laboratories and DNA Stat settlement announced in January 2018, the government alleged that payments presented as compensation for clinical study data were actually payments for patient referrals. It also alleged that physicians received in-office medical technicians.

The Primex allegations and National Spine & Pain Center’s admissions both connect a research label with referral payments. The in-office technicians show another way a laboratory could benefit the practice sending it business: supplying labor as well as money.

Another arrangement let referring providers earn money through billing. In the separate South Carolina Labsource case, the laboratory owner admitted in his guilty plea that he provided kickbacks through a direct-bill program that gave referring providers an opportunity to earn revenue from their own referrals.

A research timesheet and a direct-bill arrangement are different ways to deliver a financial benefit. In each account, the person or practice directing laboratory business stood to receive money connected to that business. That is the common point for an insider who sees physician compensation alongside laboratory referrals.

What the Practice’s Own Records Can Show

Research timesheets and payment communications record decisions made inside the relationship, from claiming credit for a task to withholding access to another testing site.

For a practice insider, those are concrete parts of a working day. You may know that a task credited to a physician was performed by a laboratory employee. You may have handled a payment dispute in which introducing the tests at another site depended on money arriving. That knowledge gives the paperwork meaning that the laboratory claim alone cannot supply.

Our work with an insider starts with that particular discrepancy. We connect the account of who did the work with the claimed research time and the payment discussions around the testing. The goal is to show what the arrangement paid for in practice, using the details you know from inside the business.

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

You Know Who Did the Research

If you handled research timesheets or laboratory payments that depended on referrals, you may know what the study paperwork concealed. We work beside you throughout the healthcare fraud case and bring in laboratory fraud whistleblower lawyers who understand physician compensation and referral arrangements. Speak to one of our Whistleblower Experts about your strongest laboratory kickback case.