Medtronic Spine settles false claims charges for $75M

A subsidiary of Medtronic Spine agreed this week to pay the federal government $75 million to settle allegations that it caused submission of false claims to Medicare by a subsidiary. The allegations concerned Kyphon Inc., bought by Medtronic Spine in November 2007 for $3.9 billion after whistleblower allegations had already been made. In addition to the settlement,
Kyphon has entered into a Corporate Integrity Agreement with HHS's Office of Inspector General.

Kyphon was accused of submitting fraudulent claims for kyphoplasty procedures, minimally invasive surgeries used to treat compression fractures of the spine caused by osteoporosis, cancer or benign lesions. According to the allegations made by whistleblowers, Kyphon engaged in a marketing scheme that caused some hospitals to bill Medicare for inpatient kyphoplasties when cheaper outpatient procedures would have been clinically appropriate. The allegations came from two former Kyphon employees, who under the False Claims Act will receive a total of $14.9 million for having reported the allegations.

To learn more about the settlement:
- read this article from Business First of Buffalo

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