Fifteen Texas Doctors Pay Over $2.8 Million To Settle Allegations

Total of Thirty-Three Texas Doctors Have Settled Related Healthcare Fraud Allegations

SHERMAN, Texas – Fifteen additional Texas doctors have agreed to pay $2,831,280. It is to resolve False Claims Act allegations involving illegal kickbacks violating the Anti-Kickback Statute and Stark Law. It is also to cooperate with the Department’s investigations of and litigation against other parties, announced Eastern District of Texas U.S. Attorney Brit Featherston today.

“These settlements should reinforce the message that the Eastern District of Texas will not tolerate health care providers who seek to enrich themselves through kickback schemes,” said U.S. Attorney Brit Featherston. “We will continue to work with our agency partners to identify those who defraud our taxpayers, and we will hold those who have engaged in the schemes responsible.”

The Anti-Kickback Statute and the Stark Law intend to ensure that medical providers do not compromise judgments by improper financial incentives and instead base thinking on the best interests of their patients. The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded programs. The Stark Law forbids a hospital or laboratory from billing Medicare for certain services referred by physicians that have a financial relationship with the hospital or laboratory.

The settlements today resolve allegations that fifteen Texas doctors violated the Anti-Kickback Statute and the Stark Law. They received thousands of dollars in remuneration from nine management service organizations (MSOs) in exchange for ordering laboratory tests. Involved were Rockdale Hospital d/b/a Little River Healthcare (Little River), True Health Diagnostics LLC (True Health), and Boston Heart Diagnostics Corporation (Boston Heart). Little River allegedly funded the remuneration to sure doctors in the form of volume-based commissions paid to independent contractor recruiters, who used MSOs to pay numerous doctors for their referrals. They allegedly disguised MSO payments to the doctors as investment returns but were based on and offered in exchange for the doctors’ referrals.

• Louis Coates, D.O., of Garland, Texas, agreed to pay $87,694 to settle allegations that from September 26, 2016, to March 14, 2018, he received kickbacks from an MSO, Herculis MG LLC, in return for ordering laboratory tests from Boston Heart.
• Jason DeMattia, M.D., and Candice DeMattia, M.D., both of Tomball, Texas, agreed to pay $316,142 and $207,009 to settle allegations from August 1, 2014, to December 31, 2016. That was when they received kickbacks from two MSOs, North Houston MSO Group, Inc. and Tomball Medical Management, Inc., in return for ordering laboratory tests from True Health and Little River.
• Emanuel Paul (“E.P. ”) Descant, II, M.D., of Spring, Texas, is paying $256,466 for allegations of kickbacks from January 5, 2015, through February 3, 2018. He received kickbacks from two MSOs, North Houston MSO Group, Inc. and Tomball Medical Management, Inc., in return for ordering laboratory tests from Little River.
• Mitchell Finnie, M.D., of San Antonio, Texas, agreed to pay $582,522 to settle allegations that from June 4, 2015, to July 11, 2017, he received kickbacks from two MSOs, Alpha Rise Health, LLC and Tango Rise Health Solutions LLC, in return for ordering laboratory tests from Boston Heart, True Health, and Little River.
• Mark Le, M.D., of Tomball, Texas, agreed to pay $57,900 to settle allegations that from May 9, 2016, to September 22, 2017, he received kickbacks from two MSOs, North Houston MSO Group, Inc. and Tomball Medical Management, Inc., in return for ordering laboratory tests from True Health and Little River.
• Richard Le, M.D., of Houston, Texas, agreed to pay $41,000 to settle allegations that from September 29, 2016, to August 24, 2017, he received kickbacks from two MSOs, North Houston MSO Group, Inc. and Tomball Medical Management, Inc., in return for ordering laboratory tests from True Health and Little River.
• Robert Jeremy Laningham, M.D., and Rodney Jason Laningham, M.D., both of Conroe, Texas, agreed to pay $470,560 to settle allegations that from August 8, 2015, through July 6, 2016, they received kickbacks from two MSOs, SYNRG Partners LLC and Transparity Associates L.P. in return for ordering laboratory tests from Boston Heart, True Health, and Little River.
• Andres Mesa, M.D., of Houston, Texas, agreed to pay $45,484 to settle allegations that from May 1, 2016, to January 9, 2018, he received kickbacks from an MSO, Transparity Associates L.P., in return for ordering laboratory tests from Boston Heart and Little River.
• Melissa Miskell, D.O., of New Braunfels, Texas, agreed to pay $100,392 to settle allegations that from July 13, 2015, to December 14, 2017, she received kickbacks from an MSO, Alpha Rise Health, LLC, in return for ordering laboratory tests from Boston Heart and Little River.
• Marco Munoz, M.D., of Fort Worth, Texas, agreed to pay $54,280 to settle allegations that from July 7, 2015, to April 6, 2016, he received kickbacks from an MSO, Alpha Rise Health, LLC, in return for ordering laboratory tests from Boston Heart and Little River.
• Kozhaya Sokhon, M.D., of The Woodlands, Texas, agreed to pay $160,456 to settle allegations that from January 16, 2015, to May 18, 2018, he received kickbacks from two MSOs, SYNRG Partners LLC and Transparity Associates L.P., in return for ordering laboratory tests from Boston Heart and Little River.
• Annie Varughese, M.D., of The Woodlands, Texas, agreed to pay $213,888 to settle allegations that from September 1, 2015, to November 17, 2017, she received kickbacks from three MSOs, SYNRG Partners LLC, Transparity Associates, L.P., and North Houston MSO Group, Inc., in return for ordering laboratory tests from True Health and Little River.
• Paul Worrell, D.O., of Dallas, Texas, agreed to pay $237,487 to settle allegations that from October 9, 2015, to December 31, 2017, he received kickbacks from three MSOs, Ascend MSO of TX LLC, Eridanus MG LLC, and BDS Healthcare, LLC, d/b/a Vybrem Labs, in return for ordering laboratory tests from Boston Heart, True Health, and Little River.

As part of their settlements, the fifteen physicians have agreed to cooperate with the Department of Justice’s investigations of and litigation against other parties involved in the alleged law violations. “The Anti-Kickback and Stark Statutes help protect the integrity of federal healthcare programs,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue pursuing individuals and corporations responsible for schemes that violate these important safeguards.” “This outcome is the result of cooperation amongst law enforcement partners focused on upholding the integrity of federal healthcare programs,” said Miranda L. Bennett of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). “We will continue to pursue physicians engaging in improper financial relationships to ensure patients receive quality medical care.”

“Today’s announcement is another step forward by the Department of Defense, Office of Inspector General’s Defense Criminal Investigative Service (DCIS), and our law enforcement partners to protect the integrity of the military’s health care system, commonly known as TRICARE,” said Acting Special Agent in Charge Gregory P. Shilling of the DCIS Southwest Field Office. “We will continue aggressively investigating and holding those accountable that take advantage of the U.S. Government and American taxpayers.”

“The VA Office of Inspector General actively investigates those in violation of the Stark Law and the Anti-Kickback Statute,” said Special Agent in Charge Jeffrey Breen of the South Central Field Office of the Department of Veterans Affairs Office of Inspector General (VA-OIG). “Today’s civil settlements demonstrate the VA OIG’s ongoing work to hold individuals accountable and protect the integrity of federal healthcare programs.”

Former True Health CEO Christopher Grottenthaler, former Boston Heart CEO Susan Hertzberg, former Little River CEO Jeffrey Madison, and others are defendants in a separate False Claims Act lawsuit in which the United States filed an amended complaint in May 2022. If a defendant is found liable for violating the act, the United States may recover three times the amount of its losses plus applicable penalties. That pending case is captioned United States ex rel. STF, LLC v. True Health Diagnostics, LLC, et al., No. 4:16-cv-547 (E.D. Tex.).

The civil settlements resulted from a coordinated effort between the U.S. Attorney’s Office for the Eastern District of Texas and the Civil Division’s Commercial Litigation Branch, Fraud Section, with assistance from HHS-OIG, DCIS, and VA-OIG. Assistant U.S. Attorneys James Gillingham, Adrian Garcia, Betty Young, Senior Trial Counsel Christopher Terranova, and Trial Attorney Gavin Thole handled the related matters. As a result of its efforts, the United States has recovered over $32 million relating to conduct involving Boston Heart, True Health, and Little River, including False Claims Act settlements with thirty-three physicians, two healthcare executives, and one laboratory.

The government’s pursuit of these matters illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. You can provide tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement to the Department of Health and Human Services at 1-800-HHS-TIPS (800-447-8477).

The claims resolved by the settlements are allegations only, and there has been no determination of liability.