In November 2017 a Bloomberg headline ironically advised, “Want to turn that pain clinic into a real moneymaker? Open your own urine-testing lab and start billing Medicare.”
Dr. Peter Kroll, CEO and Chief Medical Officer of CPS (center) with two other CPS doctors.
Back in July of 2016, when neither the public nor the authorities were aware that certain pain clinics executives were referring to these pricey urine tests as “liquid gold,” the CEO of Tennessee’s Comprehensive Pain Specialists (“CPS”) said in a press release, “Since January, CPS has seen a 19% increase in referrals from Primary Care Physicians. . . . By taking a seat on a patient’s care team, CPS is able to work with their physicians to address both the cause and the treatment of their pain. Putting patients on long term pain medication certainly isn’t the goal.”
While the press release included ‘politically correct’ statements about “treating the epidemic of chronic pain without escalating the epidemic of opioid misuse,” it didn’t shy away from boasting of the potential for large profits resulting from the passing of the Comprehensive Addiction and Recovery Act (“CARA”).
Prosecutors now believe CPS, which operated its own lab, did exactly what Bloomberg advertised, and with the help of a senator.
A lawsuit initially filed by seven whistleblowers has just been joined by the government, which named Senator Steve Dickerson and the owners of CPS as defendants. According to the Department of Justice, they have defrauded the government out of over $25 million. CPS allegedly submitted “thousands of false claims to federal and state-funded health care programs.” Senator Dickerson allegedly profited from the scheme in the amount of $6.5 million.
Senator Steve Dickerson (Republican, Tennessee Senate)
Unnecessary and overpriced urine drug tests were the source of the majority of CPS’s allegedly unlawful profits. The company billed the government for massive amounts of these tests. According to the lawsuit, “This testing was commonly referred to as 'liquid gold' — leaving no doubt that profit was Defendants’ primary objective in performing urine drug testing.” Taxpayers have suffered the most as a result of the alleged scheme, as bills for the urine tests were largely sent to TennCare and other government programs.
Now, prosecutors are seeking $50 million in damages. While a spokesperson for Senator Dickerson referred to him as “an honest man,” he is, in fact, one of the founders of CPS, alongside Dr. Peter Kroll. John Davis, a former CEO, is also a defendant in the lawsuit.
Senator Dickerson, a Republican, is an anesthesiologist. His fellow defendants include, aside from Kroll and Davis, co-founder Gilberto Carrero, and Russel Smith, a chiropractor who allegedly let CPS operate his clinic.
Aside from a large laboratory, the now-defunct CPS used to operate 60 clinics in 12 U.S. states. For pain clinics like the ones run by CPS, it is standard procedure to give new patients a drug test to ensure they are not already on opioids. These tests are costly, as they screen urine for a variety of substances. Testing for one drug at a time is cheaper and faster, and thus preferred by the majority of clinics. At CPS, however, prosecutors found that the policy was to always opt for expensive, qualitative tests in the case of every patient and every single visit. Investigators found CPS employees received bonus payments for increasing the number of tests performed. Sooner than later, prosecutors claim, the CPS lab was processing over 600 tests per day.
According to the lawsuit, “CPS lacked any medical necessity to perform the majority of these tests and did not have the requisite medical documentation to support the testing. . . . CPS providers often ignored or overlooked the testing results in making decisions on whether to prescribe opioids on follow up visits."
Whistleblower Scott Steed recalls the “overpowering and unpleasant smell of urine” that pervaded the lab during a tour given by CPS executives, one of whom allegedly commented, “To me, it smells like money.”
According to the complaint, Kroll submitted over 15,000 false claims for payment to the government, including a couple of thousand involving treatments he supposedly administered when he was, in fact, on vacation abroad. Senator Dickerson, who has been greatly involved in legislation related to the opioid crisis, allegedly submitted about 750 false claims. Dickerson, who is up for re-election next year, is cooperating with the prosecution to minimize damage to his reputation.
The Whistleblowers
Dr. Suzanne Alt worked at CPS clinics in Missouri and Iowa in 2015. Her lawsuit pointed to inflated bills to both Medicare and Medicaid and unnecessary drug tests. When she asked a supervisor why CPS never used cheaper drug tests, she was advised to “test the CPS way.” A month later, she was fired.
Dana Brown was a radiology scheduler with CPS during 2014. She alleged she had been forced to forge Dr. Kroll’s signature to allow the company to bill the government for radiology services provided by unlicensed individuals.
Mary Butner was an insurance specialist who worked at CPS’s offices from 2012 until her employment was terminated in 2016. She claimed she was forced to forge Kroll’s signature over 44 times a day.
Jennifer Pressotto was CPS’s director of compliance during the first half of 2014. She alleged she found out her employer was knowingly mislabeling medical devices that were not covered by government programs in order to be able to bill them for said devices. After confronting Davis, who was CEO at the time, she was fired “in direct retaliation,” for asking him to return the misappropriated funds to the government.
Allison Chancellor is a doctor’s assistant who worked at a CPS in Illinois during the first half of 2015. In her lawsuit, she alleged CPS billed the government for unnecessary drug tests, psychological tests, and DNA tests with the purpose of boosting government billings.
“In many cases, CPS staff do not review the patients’ urine drug screen results and did not use them in medical management of the patient, or would review them at such a later date from the test that the results were of questionable use —sometimes over two months after the tests were performed,” Chancellor’s lawsuit states.
June Kimbrough, a nurse, and Dr. Scott Steed, an anesthesiologist, are both Mississippi residents, but little else is known about their connection to CPS. Their whistleblower lawsuits also mentioned unnecessary tests and fraudulent billings.
If a favorable verdict or settlement is reached, the whistleblower could receive millions of dollars in awards. Under the False Claims Act, tipsters are entitled to between 15 and 30 percent of the government’s recoveries, as long as they file a lawsuit with original information about fraud.
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Image of Dr. Peter Kroll & associates from PRWeb.