Corporate Compliance

N.Y. medical device sales manager pleads guilty to healthcare fraud

Compliance Monitor, May 23, 2012

Michael J. McKay, 32, of Saratoga Springs, N.Y., pleaded guilty to committing healthcare fraud, according to a press release from the U.S. Attorney’s Office for Massachusetts.

McKay worked as a sales territory manager for a medical device company that manufactures and distributes bone growth stimulator to help patients with nonhealing fractures. Medicare pays for these devices only under certain circumstances. Between 2008 and 2009, McKay received orders from patients who did not meet Medicare’s criteria, according to the U.S. Attorney’s Office. McKay then forged patient medical records by altering physician’s chart notes, changing the dates of patient visits, and inserting false diagnoses so orders would appear to meet the criteria.
The medical device company fired McKay when it learned of the fraud. McKay’s supervisor and another sales territory manager, Derrick Field, then created a plan for McKay to continue submitting false claims under Field’s name. Field and McKay then split the commissions. Field was also convicted of healthcare fraud in a separate proceeding.
Between 2008 and 2010, federal insurance carriers paid more than $70,000 for bone growth stimulators where McKay forged the medical records. McKay faces up to 10 years in prison and three years of supervised release, a $250,000 fine, asset forfeiture, and restitution when he is sentenced September 6.

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