Columbia, South Carolina – Colonial Family Practice, LLC, a South Carolina-based primary and urgent care provider owned by physicians, has reached a settlement of $1.25 million with the United States government. This agreement resolves allegations that the practice violated the False Claims Act by submitting claims to federal healthcare programs, including Medicare, Medicaid, and TRICARE, for services deemed medically unnecessary.
The central allegations against Colonial Family Practice involve claims filed for medically unnecessary nuclear stress tests ordered by physicians Dr. Clay Lowder and Dr. David Whaley between February 2012 and November 2019. Additionally, the government contended that Colonial Family Practice systematically billed for Cystatin-C laboratory tests that were not medically required. Cystatin-C tests, designed to detect kidney dysfunction, are only considered payable under specific and limited patient conditions. It is alleged that Colonial Family Practice added this test to a standard panel for a broad spectrum of patients from August 2013 to November 2019.
These allegations originated from two separate whistleblower lawsuits initiated by individuals formerly associated with Colonial Family Practice. One lawsuit was brought forward by a Physician Assistant previously employed by the practice, and the other by a former clinical manager.
In the case United States ex rel. Debi Coker v. Colonial Family Practice LLC, et al., Civ. No. 3:18-cv-00800-JMC, the former clinical manager claimed that from February 2012 to November 2019, physicians at Colonial Family Practice falsified patient symptoms in medical records. This alleged falsification was purportedly done to justify unnecessary EKGs, laboratory orders, and radiology services, leading to improper billing practices.
The second case, United States ex rel. James Fields v. Colonial Family Practice, et al., Civ. No. 3:19-cv-02703-JMC, was initiated by the former Physician Assistant. This lawsuit alleged that between August 2013 and November 2019, Colonial Family Practice established a protocol to include the Cystatin-C laboratory test within its Basic Metabolic Panel. This protocol, according to the allegations, resulted in the systematic billing of medically unnecessary Cystatin-C tests across a wide patient base.
Acting United States Attorney M. Rhett DeHart stated, “The United States Attorney’s Office is committed to ensuring that healthcare providers who engage with the federal government operate with both competence and full legal compliance. This commitment not only upholds the rule of law but also safeguards taxpayer funds.”
Special Agent in Charge Christopher Dillard of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Mid-Atlantic Field Office, commented on the broader implications of healthcare fraud. “False and inappropriate healthcare billing undermines public trust in the healthcare system, exposes patients to potentially harmful and unnecessary procedures, and inflates healthcare costs for our active duty service members, retirees, and their families. DCIS, alongside our law enforcement partners, remains dedicated to combating fraud, waste, and abuse within the TRICARE program and ensuring that those responsible are held accountable.”
The investigation into this matter was a collaborative effort involving the Department of Defense’s Defense Health Agency, the South Carolina Attorney General’s Medicaid Fraud Enforcement Unit, and Assistant United States Attorneys Beth Warren and Nancy Cote.
This settlement underscores the government’s strong focus on combating healthcare fraud. The False Claims Act serves as a critical instrument in these efforts. Individuals with information regarding potential fraud, waste, abuse, and mismanagement in healthcare are encouraged to report it to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
It is important to note that the claims addressed in this settlement are allegations only, and by entering into this settlement, Colonial Family Practice, LLC has not admitted to any wrongdoing or liability.
