Medical device maker THD America has agreed to pay $700,000 to settle False Claim Act allegations that claim the company knowingly caused physicians to use incorrect codes to obtain inflated reimbursement from Medicare and state Medicaid programs for the use of its hemorrhoid removal system.
The Department of Justice alleged that between 2014 and 2017, physicians performing procedures using THD's kit were required to bill for the procedure using a temporary code, also known as a “T-Code,” assigned for new and emerging services, according to a Sept. 6 press release.
Procedures that are assigned such a code are considered experimental, so reimbursement for the use of the kit was often denied. To avoid denials and increase potential reimbursement, THD allegedly encouraged colorectal and general surgeons improperly to bill Medicare and Medicaid programs using the T-code plus an additional current procedural terminology code.
The federal share of the civil settlement is $598,121, while the state Medicaid share of the civil settlement is $101,877.