CVR Management, LLC, a Maryland-based professional services corporation that manages the Center for Vein Restoration's multi-state network of vascular medicine clinics, will pay $4 million to state and federal governments to resolve civil allegations that the company caused false claims to be submitted to Medicare, Medicaid and TRICARE. Connecticut's Medicaid program will receive $114,280.07 of the total $604,365.07 allocated to state Medicaid programs through the settlement.
The settlement resolves allegations that from January 1, 2010 to December 31, 2016, CVR billed government health programs for unnecessary chronic venous insufficiency treatments including sclerotherapy, radiofrequency ablation and endovenous laser ablation. Government health programs do not cover such treatments when performed for purely cosmetic reasons, and coverage for chronic venous insufficiency requires certain accompanying conditions and failed alternative treatments. A lengthy investigation found that CVR knowingly billed the programs for procedures that were not clinically indicated and were medically unnecessary.
Under the settlement terms, CVR will pay the full $4 million to resolve the false claims allegations without admitting liability. The company must also comply with ongoing compliance obligations, though specific details of those requirements were not disclosed in the Attorney General's announcement.
The settlement stems from two qui tam whistleblower actions filed under the False Claims Act—the first in 2015 in the U.S. District Court for the District of Maryland and a second in 2018 in the Eastern District of Pennsylvania that was later consolidated with the Maryland case. The investigation and settlement negotiations were conducted by a National Association of Medicaid Fraud Control Units team representing eight states and the District of Columbia.
"Medicaid does not cover the treatment of varicose veins for cosmetic reasons alone. CVR knew this, but billed state Medicaid programs for medically unnecessary treatments anyway. Acting in coordination with our state and federal partners, we will continue to aggressively protect the integrity of our public healthcare programs," said Attorney General Tong.
The multistate enforcement team included representatives from Connecticut, Indiana, Maryland, Michigan, New Jersey, New York, Virginia, and the District of Columbia. Assistant Attorney General Eric Babbs served on the NAMFCU team under supervision of Deputy Associate Attorney General Gregory O'Connell, Chief of the Government Fraud Section.
The settlement demonstrates continued state and federal coordination in pursuing healthcare fraud cases, particularly those involving medically unnecessary procedures billed to government programs. The case highlights the importance of proper documentation and medical necessity determinations for vein treatments covered by public health insurance programs.