State Farm, a leading auto insurer, has sued a referral service, chiropractic firm and others alleging, inter alia, that they engaged in a fraudulent scheme of referrals to and from a plaintiff’s firm that resulted in monetary loss to State Farm via it medical payments and personal injury protection (PIP) coverage.
Here is a summary of the action as set forth in the federal court complaint:
This action involves a massive fraud scheme by the Defendants to obtain from State Farm Personal Injury Protection (“PIP Benefits”) and Medical Payments Coverage (“MPC Benefits”) insurance benefits (collectively, PIP Benefits and MPC Benefits are referred to as “No-Fault Benefits”) for services and treatments purportedly rendered to patients at Physicians Group clinics in Florida, which are owned by Kompothecras [a chiropractor]. The services and treatments were not lawful when they were rendered because the Defendants intentionally violated several important criminal, civil and administrative laws to lure unwitting motor vehicle accident victims to receive the services and treatments at the Physicians Group clinics, namely the Patient Brokering Act (Fla. Stat. § 817.505), the Patient Self-Referral Act of 1992 (Fla. Stat. § 456.053), the Anti-Kickback Statute (Fla. Stat. § 456.054), the Deceptive and Unfair Trade Practices Act (Fla. Stat. § 501.201 et seq.) (“FDUTPA”), the laws establishing grounds for disciplinary action against chiropractors who engage in false and misleading advertising (Fla. Stat. § 460.413(d), (f) and (l)), and administrative rules prohibiting chiropractors from engaging in deceptive and misleading advertising (F.A.C. Rule 64B2-15.001(2)(a), (b) and (k)). The driving force behind the Defendants’ scheme is to exhaust their unsuspecting patients’ limited No-Fault Benefits, without regard to whether the patients may have health insurance that might otherwise cover some or all of Physicians Group’s charges, thereby preserving their No-Fault Benefits for other medical services that the patients may truly need.
Those of you who have been to Florida and Kentucky have seen the 1-800-ASK-GARY ads that State Farm alleges are part of the scheme to shunt business to a certain chiropractic firm. Basically, the complaint alleges that a host of laws were violated by the "referral service" and by a pattern of referrals from a chiropractic firm to a law firm and a law firm back to the chiropractic firm. It also alleges that a number of devices were employed to hide what it says is the true ownership of the 1-800-ASK-GARY referral service – a chiropractor.
The complaint includes an affidavit from a former lawyer employee of a Kentucky law firm. This lawyer alleges he was fired for refusing to refer clients assigned to him to the chiropractic firm that received referrals from his employer and who in turn had an understanding to refer patients to the chiropractic firm. Click on the link to read the affidavit of the lawyer. The State Farm complaint can be assessed by clicking on the link.
(Both links are to the Kentucky Trial Court Review, from which I learned that this case had been filed.) Kentucky Trial Court Review is part of Jury Verdict Publications, a company owned by Shannon Ragland of Louisville.)
One law firm that allegedly was part of this scheme was the Winters and Yonker firm, formerly of Florida and Kentucky. The complaint alleges that the firm disbanded after its founders were suspended from the practice of law for ethical reasons that appear to be unrelated to this alleged scheme. Multiple other firms are alleged to have been part of the referral service, although there are no specific allegations that any other particular firm had a practice of trading referrals with the chiropractic firm.
The chiropractor who allegedly is at the head of the entire "scheme" is Gary Kompothecras.of Sarasota, Florida, Dr. Kompothecras seems to have done well – he reportedly owns a 29,000 foot home in Sarasota.
The 1-800-ASK-GARY "referral service" has never done business in Middle Tennessee, but I have heard rumors of very "aggressive" interaction between certain chiropractors and certain lawyers in this part of the state. Maybe this litigation will remind both lawyers and chiropractors who have chosen to violate the ethical standards of their respective professions that there are potential consequences to their actions.