COCHLEAR IMPLANTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Disability Rights
|
|
|
|
|
|
|
Sitemap
|
|
|
|
|
|
|
FORMER CFO TURNS IN COCHLEAR AMERICASIllegal Physician Payments at Heart of Federal Investigation
Click here for a copy of the fraud complaint filed in January 2004 against Cochlear Americas.
The whistleblower in this case was unsealed and identified in February 2007 as Brenda March. She is the former Chief Financial Officer and Vice President of Customer Care for Cochlear from 1998-2004.
The portion of March's complaint that was unsealed focuses on Cochlear's Partners Program. Otologic Reimbursement Management's partners vigorously opposed this program when it was first proposed by the Sales Department while both were Cochlear employees. The program awarded physicians with points towards free goods and services whenever they implanted Cochlear Americas' devices, and subtracted points when they implanted competing devices.
Since 1997, ORM openly warned consumers and providers of the potential illegality of the Partners Program. This included many posts on the York University cochlear implant listserve, and documentation on this website since 2000.
March's complaint also reference Cochlear's payment of gifts and gratuities to physicians, including compensation for their participation in advisory boards. As early as 1997, ORM also warned providers and consumers to ask their physicians about these payments, especially if physicians insisted upon implanting only Cochlear devices.
The effect of these illegal payments is to control the referral patterns of physicians, keeping the cost of implants artificially high. As documented in a 2002 RAND study, this has greatly limited the number of eligible candidates who can actually be implanted.
The U.S. Department of Justice has intervened in March's case and transferred the matter to the Office of Inspector General for the Department of Health and Human Services (HHS).
Thus, it appears that DOJ found evidence that Cochlear's actions violated the Federal anti-kickback statute. OIG is likely to impose civil penalties but not criminal sanctions.
Cochlear's 2007 annual report states simply that they are cooperating with the government and have no other news to report. There has been no acknowledgement of settlement or denial of wrongdoing. A portion of March's original 2004 complaint remains under seal so the investigation may be continuing on those counts.
|
|
|
