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# Device Co. Pays $500K over False Claims: DoJ
- URL: https://www.fdaweb.com/device-co-pays-500k-over-false-claims-doj/
- Published: 2023-02-03T12:00:00.000Z
- Updated: 2026-09-14T18:14:32.000Z
- Author: David McFarland
- Tags: Devices, #legacy-id-D5153698

The Department of Justice (DoJ) says medical device manufacturer Joint Active Systems (JAS), of Effingham, IL, has agreed to pay $500,000 to settle civil claims under federal and North Carolina False Claims Acts concerning allegations that it caused submission of false claims to North Carolina’s Medicaid program. DoJ and the state contended that JAS was unable to directly bill North Carolina Medicaid for its EZ range-of-motion devices because it did not meet state requirements and/or lacked credentials necessary to do so, according to a [DoJ release](https://www.justice.gov/usao-ednc/pr/illinois-medical-device-manufacturer-agrees-pay-500000-resolve-allegedly-fraudulent?ref=fdaweb.com).

JAS directed local North Carolina orthotics and prosthetics providers to improperly submit claims for its devices as orthotics using “L-Codes” under the Healthcare Common Procedure Coding System, “thereby bypassing the medical necessity reviews and/or authorization processes that may have otherwise taken place, DoJ says, adding that the devices did not qualify for reimbursement as “L-Code” orthotics and they were not listed as reimbursable devices on the North Carolina Medicaid fee schedule.

“The Department of Justice is actively pursuing health care companies and medical device manufacturers who overcharge government healthcare programs,” said U.S. Attorney **Michael Easley**. “We cannot allow companies to bypass rules and regulations to enrich themselves, while depleting taxpayer funds set aside for legitimate patient care.”