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Medical Device Firms Under Investigation for Fraud by DOJ

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Last week, medical device company Endoscopic Technologies (also known as Estech) agreed to pay $1.4 million to settle Medicare fraud claims related to surgical ablation devices, according to the Department of Justice. Estech suggested their devices off-label for a condition known as atrial fibrillation, an irregular and often rapid heart rate that causes poor blood flow to the body, even though it was not approved by the U.S. Food and Drug Administration (FDA) for the condition. The allegations were filed by a former medical device employee in a whistleblower complaint.

According to media reports, Estech also paid kickbacks to healthcare providers, and advised them how to seek inflated Medicare payments for unnecessary procedures using their devices, when less-invasive procedures would have been more appropriate.

Medtronic, St. Jude Medical, AtriCure, and Boston Scientific are all under investigation for similar practices, according to complaints unsealed last week in a Texas federal court.

These findings, time and time again, make clear that medical devices company can’t police themselves. Additionally, these very same companies currently are immune from liability for class III medical devices because of the Supreme Court ruling in Riegel v. Medtronic. The ruling held that because the medical devices have been approved by the Food and Drug Administration’s premarket approval process, patients injured by faulty devices cannot pursue state tort claims. So while device companies are engaging in illegal kickback schemes and profiting from Medicare fraud, patients injured by defective medical devices have no recourse of their own when a device has failed.

Congress is considering the Medical Device Safety Act (S. 540/H.R. 1346) to restore justice to injured patients. Consumer safety should take priority over corporate profits, especially when medical device companies operate like they are above the law.

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  1. JILL PAUL RN says:
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    Cecelia, thank you for your very informative post regarding consumer safety and medical devices. Of course, consumer safety should take priority over corporate profits and greed. The Medical Device Safety Act S540/HR1346 needs to be passed immediately before other patients are injured by faulty medical devices or devices are used not for their intended purpose.

    Please join the The Medical Device Safety Act Petition which can be found at: http://www.PetitionOnline.com/tftwj23/petition.html

    If you or a loved one has been injured by a faulty medical device, it is imperative that our voices be heard in Congress and The Senate. Thank you.

  2. Mike Bryant says:
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    This is very important information that all consumers and most important patents need to have. There need to be full disclosure of all of these relationships. Thanks for the information.