Two Tennessee healthcare executives were charged April 9 for their alleged involvement in a $4.6 million kickback scheme involving durable medical equipment, according to the Department of Justice.
John Davis, the former CEO of Comprehensive Pain Specialists in Brentwood, Tenn., and Brenda Montgomery, the owner, founder and CEO of CCC Medical, a durable medical equipment company based in Camden, Tenn., were each charged with one count of conspiracy to defraud the U.S. and to pay and receive healthcare kickbacks, and seven counts of paying and receiving healthcare kickbacks.
The indictment alleges from June 2011 until June 2017, Ms. Montgomery paid Mr. Davis illegal kickbacks in exchange for Medicare referrals for durable medical equipment ordered by Comprehensive Pain Specialists employees. According to the indictment, Ms. Montgomery agreed to pay Mr. Davis 60 percent of Medicare proceeds collected on claims billed for durable medical equipment ordered by Comprehensive Pain Specialists providers and referred by Mr. Davis.
In 2015, Ms. Montgomery allegedly agreed to pay Mr. Davis $200,000 for the purchase of a shell entity known as ProMed Solutions to induce Mr. Davis to continue driving referrals to CCC Medical. However, Ms. Montgomery ultimately paid $150,000 for the shell company after complaining that her referrals from Comprehensive Pain Specialists had been lower than expected, according to the indictment.
Ms. Montgomery and Mr. Davis allegedly took several steps to conceal their illegal agreement, including creating and filing false tax documents.
Ms. Montgomery allegedly submitted more than $4.6 million in fraudulent claims to Medicare through the scheme, and Medicare paid a total of $2.6 million on those claims. She allegedly paid more than $770,000 in illegal kickbacks to Mr. Davis.
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