Pain Medicine Physician Sues To Halt $5.9 Million Recoupment Before Final Decision

St. Louis, MO (WorkersCompensation.com) – Federal investigators have been busy targeting pain management practitioners, resulting in indictments for fraudulent billing, and sometimes netting million-dollar settlements. A pain management lawsuit filed earlier this week aims to turn the tide of audits for medical necessity, or at least shine a light on what the parties view as a flawed review system.

Pain Management Specialist Gurpreet S Padda, MD, who is board-certified in anesthesiology, pain management, and addiction medicine, and sole owner of Interventional Center for Pain Management in St. Louis, is suing the federal government for recoupment of over $5.9 million in payments on only $14,000 worth of claims in question. The complaint was filed earlier this week against the Department of Health and Human Services, Centers for Medicare and Medicaid Services, and WPS Government Health Administrators.

According to the complaint, in early 2020 CoventBridge Group, an auditor entity for WPS, requested medical records on 64 patients for a date of service range of 3 months from 2016 to 2020. The auditors reviewed 55 claims out of a possible 44,580 that were submitted - a percentage of only 0.1 percent, a total which is impossible to accurately extrapolate for procedural fairness, according to the complaint.

The auditors, who also receive a percentage of the overpayments that they discover, determined that the total due from erroneous payments was $14,418.93. However, after utilizing the methodology for penalties on the date span of the $14,000 in overpayment, the pending recoupment totaled $5,964,295 based on the sample of 55 claims reviewed, equating to a 39,934-percent increase.

In review of the pending refund and in the process of reconsideration requests and appeals, Padda confirmed that all required documentation was present, and that the claims were valid, supported and medically necessary. Additionally, Padda discovered that it was evident that the auditors did not fully review the documentation that was submitted; and when the auditors stated that medical records were missing, provided specific examples that the information was indeed present. Furthermore, the complaint states there is no indication of medical qualifications of the auditors that had determined the claims were paid in error.

Padda hired an independent statistician to review the extrapolation of the penalty. Patricia L. Maykuth, Ph.D, who is recognized as an overpayment expert, found numerous errors in the calculations and submitted a 35 page report of the findings.

Padda has filed yet another appeal; however, there is an enormous backlog at the Office of Medicare Hearings and Appeals (“OMHA”) and the $5.9 million is slated for immediate recoup from current payments when it could be years before the case is ever reviewed and decided. According to the complaint, OMHA reports that the average time for a case filed in 2020 to be heard by an administrative law judge is nearly 4 years due to an increase in cases initiated by auditors.

The Padda complaint calls into question the effectiveness of the system of recoupment and review, as 62-percent of provider appeals heard at the ALJ level are successful or partially successful. Of the remaining appeals, 14 percent are dismissed, and 24 percent were unfavorable. Between 2012 and 2020, unfavorable decisions accounted for less than 30 percent of the appeals filed.

Padda’s complaint contends that an immediate recoup of the $5.9 million is a violation of procedural process that will essentially force him out of business. The federal defendants in the case do not contend that the penalty is a result of fraud, and Padda contends that the dispute on the claims themselves is a difference in clinical opinion.

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