Fifteen Texas doctors agree to pay over $2.8 million to settle kickback allegations

Law and Settlement scroll with gavel

Fifteen additional Texas doctors have agreed to pay a total of $2.83 million to resolve False Claims Act allegations involving illegal kickbacks in violation of the Anti-Kickback Statute and Stark Law and to cooperate with the Department of Justice’s investigations of and litigation against other parties.

“The Anti-Kickback and Stark Statutes help protect the integrity of federal health care programs,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue to pursue both individuals and corporations responsible for schemes that violate these important safeguards.”

“These settlements should reinforce the message that the Eastern District of Texas will not tolerate health care providers who seek to enrich themselves through kickback schemes,” said U.S. Attorney Brit Featherston for the Eastern District of Texas. “We will continue to work with our agency partners to identify those who defraud our taxpayers and we will hold those who have engaged in the schemes responsible.”   

“This outcome is the result of cooperation amongst law enforcement partners focused on upholding the integrity of federal health care programs,” said Special Agent in Charge Miranda L. Bennett of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). “We will continue to pursue physicians engaging in improper financial relationships to ensure patients are receiving quality medical care.”

The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally-funded programs. The Stark Law forbids a hospital or laboratory from billing Medicare for certain services referred by physicians that have a financial relationship with the hospital or laboratory. The Anti-Kickback Statute and the Stark Law are intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients.

The settlement announced resolves allegations that 15 Texas doctors violated the Anti-Kickback Statute and the Stark Law by receiving thousands of dollars in remuneration from nine management service organizations (MSOs) in exchange for ordering laboratory tests from Rockdale Hospital dba Little River Healthcare (Little River), True Health Diagnostics LLC (True Health), and/or Boston Heart Diagnostics Corporation (Boston Heart). Little River allegedly funded the remuneration to certain doctors, in the form of volume-based commissions paid to independent contractor recruiters, who used MSOs to pay numerous doctors for their referrals. The MSO payments to the doctors were allegedly disguised as investment returns but in fact, were based on, and offered in exchange for, the doctors’ referrals. 

  • Louis Coates, D.O., of Garland, Texas, agreed to pay $87,694 to settle allegations that from Sept. 26, 2016, to March 14, 2018, he received kickbacks from an MSO, Herculis MG LLC, in return for ordering laboratory tests from Boston Heart.
  • Jason DeMattia, M.D., and Candice DeMattia, M.D., both of Tomball, Texas, agreed to pay $316,142 and $207,009, respectively, to settle allegations that from Aug.1, 2014, to Dec. 31, 2016, they received kickbacks from two MSOs, North Houston MSO Group Inc. and Tomball Medical Management Inc., in return for ordering laboratory tests from True Health and Little River.
  • Emanuel Paul (E.P.) Descant II, M.D., of Spring, Texas, agreed to pay $256,466 to settle allegations that from Jan. 5, 2015, through Feb. 3, 2018, he received kickbacks from two MSOs, North Houston MSO Group Inc. and Tomball Medical Management Inc., in return for ordering laboratory tests from Little River.
  • Mitchell Finnie, M.D., of San Antonio, Texas, agreed to pay $582,522 to settle allegations that from June 4, 2015, to July 11, 2017, he received kickbacks from two MSOs, Alpha Rise Health LLC and Tango Rise Health Solutions LLC, in return for ordering laboratory tests from Boston Heart, True Health and Little River.
  • Mark Le, M.D., of Tomball, Texas, agreed to pay $57,900 to settle allegations that from May 9, 2016, to Sept. 22, 2017, he received kickbacks from two MSOs, North Houston MSO Group Inc. and Tomball Medical Management Inc., in return for ordering laboratory tests from True Health and Little River.
  • Richard Le, M.D., of Houston, Texas, agreed to pay $41,000 to settle allegations that from Sept. 29, 2016, to Aug. 24, 2017, he received kickbacks from two MSOs, North Houston MSO Group Inc. and Tomball Medical Management Inc., in return for ordering laboratory tests from True Health and Little River.
  • Robert Jeremy Laningham, M.D., and Rodney Jason Laningham, M.D., both of Conroe, Texas, agreed to pay $470,560 to settle allegations that from Aug. 8, 2015, through July 6, 2016, they received kickbacks from two MSOs, SYNRG Partners LLC and Transparity Associates LP in return for ordering laboratory tests from Boston Heart, True Health and Little River.
  • Andres Mesa, M.D., of Houston, Texas, agreed to pay $45,484 to settle allegations that from May 1, 2016, to Jan. 9, 2018, he received kickbacks from an MSO, Transparity Associates LP, in return for ordering laboratory tests from Boston Heart and Little River.
  • Melissa Miskell, D.O., of New Braunfels, Texas, agreed to pay $100,392 to settle allegations that from July 13, 2015, to Dec. 14, 2017, she received kickbacks from an MSO, Alpha Rise Health LLC, in return for ordering laboratory tests from Boston Heart and Little River.
  • Marco Munoz, M.D., of Fort Worth, Texas, agreed to pay $54,280 to settle allegations that from July 7, 2015, to April 6, 2016, he received kickbacks from an MSO, Alpha Rise Health LLC, in return for ordering laboratory tests from Boston Heart and Little River.
  • Kozhaya Sokhon, M.D., of  Woodlands, Texas, agreed to pay $160,456 to settle allegations that from Jan. 16, 2015, to May 18, 2018, he received kickbacks from two MSOs, SYNRG Partners LLC and Transparity Associates LP, in return for ordering laboratory tests from Boston Heart and Little River.
  • Annie Varughese, M.D., of  Woodlands, Texas, agreed to pay $213,888 to settle allegations that from Sept. 1, 2015, to Nov. 17, 2017, she received kickbacks from three MSOs, SYNRG Partners LLC, Transparity Associates LP, and North Houston MSO Group Inc., in return for ordering laboratory tests from True Health and Little River.
  • Paul Worrell, D.O., of Dallas, Texas, agreed to pay $237,487 to settle allegations that from Oct. 9, 2015, to Dec. 31, 2017, he received kickbacks from three MSOs, Ascend MSO of TX LLC, Eridanus MG LLC, and BDS Healthcare LLC, dba Vybrem Labs, in return for ordering laboratory tests from Boston Heart, True Health and Little River.

As part of their settlements, the 15 physicians have agreed to cooperate with the Department of Justice’s investigations of and litigation against other parties involved in the alleged violations of law.

“The announcement is another step forward by the Department of Defense, Office of Inspector General’s Defense Criminal Investigative Service, and our law enforcement partners to protect the integrity of the military’s health care system, commonly known as TRICARE,” said Acting Special Agent in Charge Gregory P. Shilling of the DCIS Southwest Field Office. “We will continue to aggressively investigate and hold those accountable that take advantage of the U.S. government and American taxpayers.”

“The VA Office of Inspector General actively investigates those in violation of the Stark Law and the Anti-Kickback Statute,” said Special Agent in Charge Jeffrey Breen of the South Central Field Office of the Department of Veterans Affairs Office of Inspector General (VA-OIG). 

Former True Health CEO Christopher Grottenthaler, former Boston Heart CEO Susan Hertzberg, former Little River CEO Jeffrey Madison, and others are defendants in a separate False Claims Act lawsuit in which the United States filed an amended complaint in May 2022. That pending case is captioned United States ex rel. STF, LLC v. True Health Diagnostics, LLC, et al., No. 4:16-cv-547 (E.D. Tex.). If a defendant is found liable for violating the act, the United States may recover three times the amount of its losses plus applicable penalties.