GEICO Sues Chiropractors Over $2M Fraud

On Thursday a case was filed in the District of New Jersey by Government Employees Insurance Company (GEICO) and its affiliates against the East Coast Spine, Joint, and Sports Medicine Professional Association and a number of associated doctors and other associates. GEICO alleged the submission of claims with fraudulent authorizations or billing information, causing payment of over $1.9 million dollars.

The complaint explained that personal injury protection (PIP) clauses in motor vehicle insurance plans require the insurance company to reimburse medical bills that are related to a motor vehicle accident in accordance with the statutory restrictions of the state. In New Jersey, the complaint said, these rules include that insurance companies are only required to pay for medically necessary treatment, and not treatment that is performed for convenience, a requirement that the doctor certifying the test as necessary cannot be an owner or partial owner of the center providing the test due to conflict of interest, and that during the time period of this case, chiropractors were not permitted to own the center providing the test.

Other restrictions, the complaint said, govern recordkeeping and coding requirements, and a requirement that treatments not billed in a manner to maximize profit.

The plaintiffs allege that the defendants are operating under an unlawful corporate structure, because the facility is a “diagnostic office” that cannot be owned by a chiropractor. GEICO alleges that the business was owned by a chiropractor from at least 2013 to 2018. They also alleged that the defendants engaged in illegal self-referrals of pain management treatment. Finally, GEICO alleged that the defendants routinely overstated the severity of diagnoses when coding bills in a variety of steps in the treatment process. The 120-page complaint lists dozens of examples of purportedly fraudulent conduct.

The insurance company is suing for declaratory judgment as to the status of the clinic at the time services were rendered, as well as fraud, RICO, and unjust enrichment. Plaintiffs are represented by Rivkin Radler LLP.