Court Threatens ‘Practice of Medicine’ Defense: Attorneys

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A Cooley Alert says a recent 4th Circuit Court of Appeals decision in a Medicare fraud case may embolden the government to reject the “practice of medicine” defense whenever a healthcare practitioner uses an approved or cleared medical device for off-label uses, under the theory that any device that violates the Federal Food, Drug, and Cosmetic Act is not “legally marketed.” The alert says the case involved an ENT doctor who was convicted of a $4.7 million four-year Medicare fraud scheme involving repeated use of surgical devices that FDA approved for only a single use.

The doctor reportedly reused the Entellus XprESS device in balloon sinuplasty surgery for which she billed Medicare for the cost of a new device for each surgery. The alert says the doctor charged Medicare more than $46 million for balloon sinuplasty surgery and at one point was the nation’s leading Medicare biller for the procedure.

“During the first Trump administration,” the report says, “the Department of Justice (DoJ) brought record-breaking criminal charges and recoveries for healthcare fraud. Now, with newfound vigor in the wake of [the Circuit Court decision], we expect DoJ and FDA under the second Trump administration to continue aggressively prosecuting fraud involving medical devices by supplementing long-standing enforcement mechanisms with additional charges under Section 301(k).”

The attorneys say the decision is the second federal appellate ruling, and the first since the Supreme Court’s decision ending deference to agency legal interpretations, to endorse the government’s expansive reading of Section 301(k), which criminalizes certain actions involving regulated products.

“Industry participants can expect close scrutiny by federal and state enforcers over the use of allegedly adulterated medical devices to perpetuate healthcare fraud,” the alert concludes.

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