Remote cardiac monitoring manufacturers pay $13.45M to settle fraud charges

Judge banging gavel on stack of money
Prosecutors say companies used a remote cardiac monitoring device to boost reimbursement.

Two manufacturers of a cardiac device that allows physicians to remotely monitor patient data agreed to pay nearly $13.5 million to settle allegations that they defrauded Medicare.

The allegations revolved around the Pocket ECG built by Spectocor, a Texas-based device manufacturer. According to the Department of Justice, Spectocor said the device was capable of three different monitoring services, but beginning in 2011 physicians were only allowed to enroll patients based on the highest rate of reimbursement.

Another Texas company, Medi-Lynx Cardiac Monitoring LLC began selling the Pocket ECG using the same business model in 2013. Spectocor and the company’s owner will pay $10.56 million, while Medi-Lynx and its majority stakeholder will pay $2.89 million.

Spectocor’s website says Pocket ECG allows patients to be constantly monitored for cardiovascular diseases without being hospitalized. For physicians, the device “identifies in real time the morphology of each heartbeat and allows remote monitoring of thousands of patients simultaneously."

“Sophisticated medical technology can be used to help doctors dramatically improve the lives of their patients, but it can also be misused to fraudulently increase medical bills,” Acting U.S. Attorney William E. Fitzpatrick for the District of New Jersey said in a press release.

The settlement comes several weeks after the DOJ resolved False Claims Act allegations against eClinicalWorks for failing to meet Meaningful Use certification and prompting improper EHR incentive payments.