Wireless medical technology company BioTelemetry and its subsidiary LifeWatch Services agreed to pay more than $14.7 million as part of a settlement with the Department of Justice (DOJ) regarding alleged false claims submitted to federal healthcare programs.
BioTelemetry, which was acquired by Philips in 2021, was accused of violating the False Claims Act by knowingly submitting claims for a higher level of service than physicians had ordered or that was medically necessary, according to the DOJ’s press release Monday.
Of the settlement total, nearly $7.4 million is restitution, per the settlement agreement. Michael Pelletier, an individual employed by one of LifeWatch’s customers, will receive approximately $2.3 million for his claims under the qui tam provisions of the False Claims Act that initiated the case, while another group of whistleblowers will receive approximately $270,000.
The details: From July 2014 through December 2020, a LifeWatch device was marketed to doctors as being capable of performing three different types of heart monitoring services: holter, event monitoring, and telemetry. The telemetry service was the most expensive of the group and provided the highest rate of reimbursement.
LifeWatch knew the design of its online enrollment portal for the device was causing clinical staff to unwittingly select options that would enroll patients in the telemetry service, the DOJ alleged. Sales personnel at LifeWatch were accused of instructing clinical staff to select options that resulted in telemetry enrollment.
The company also disregarded written notes from clinic personnel about ordering a service other than telemetry, according to the DOJ.
“Diagnostic companies, like other providers, are expected to bill federal healthcare programs only for medically necessary services,” said Principal Deputy Assistant Attorney General Brian Boynton, head of the DOJ’s Civil Division, in the agency’s release. “We will hold accountable those who misuse taxpayer-funded programs for their own enrichment.”
BioTelemetry and LifeWatch did not admit liability in reaching settlement. Representatives from Philips did not respond to a request for comment.