Hospital Pays $20 Million to Settle Neurosurgeon Inventor Kickback Case

F.J. Thomas

Sioux Falls, SD (WorkersCompensation.com) – While denying any illegalities, a South Dakota hospital system has agreed to pay $20.25 million to settle a False Claims Act allegation against one of its physicians. Two doctors at Sanford Hospital System alleged that the facility’s top neurosurgeon, Wilson Asfora, MD, was performing medically unnecessary spinal surgeries involving an implant device distributed by Asfora’s physician-owned distributorship for which he was receiving commission, in violation of the Anti-Kickback Statute and the FCA. The complaint, originally filed in 2016, said the hospital had failed to take action despite being notified on numerous occasions.

According to the Department of Justice, the hospital system ignored warnings from other physicians about the alleged kickback scheme and that Asfora had a “substantial financial interest” in the devices. The complaint says Sanford continued to employ Asfora, allowed him to profit from the devices in surgeries, and continued to submit claims to federal healthcare programs for these surgeries — including some that were medically unnecessary.

Sanford agreed to settle the complaint but denied any liability or wrongdoing. “We chose to settle because the amount is far less than the unnecessary costs and operational disruption that would have persisted for multiple years,” said Sanford’s Chief Operating Officer Matt Hocks, in a statement “We continue to stand behind the medical care that Dr. Wilson Asfora, who was a Sanford physician from 2007 to 2019, provided to his patients. We remain committed to our providers doing what is best for their patients and supporting them in bringing innovative interventions and treatments to patients and communities.”

In addition to the monetary settlement, Sanford also entered into a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services Office of Inspector General. Included is a requirement for Sanford to “maintain a compliance program, implement a risk assessment program, and hire an Independent Review Organization to review Medicare and Medicaid claims at Sanford Medical Center,” according to the Justice Department. “It also increases individual accountability by requiring compliance-related certifications from Sanford Medical Center’s board of directors and key executives.”

Authorities say Asfora had entered into a physician owned distributorship agreement with Medical Designs, LLC , in particular for his pedicle screws that he himself designed. The complaint alleges that after he received FDA approval of his implant, Asfora increased the number of cages that he used, and that he improperly billed for services and medically unnecessary surgeries with financial consideration as the deciding factor.

For his part, Asfora denied any wrongdoing and issued a statement through his attorney stating, “I stand by my work as a physician and made every single medical decision based solely on my judgment as to what was the best for my patient, not myself.”

Originally from Brazil, Asfora came to Sioux Falls in 1991 and was in independent practice until 2007. In addition to healthcare, he has also owned a Mexican restaurant, a recording studio, and a semi-pro soccer team. He currently owns the Carnaval Brazilian Grill steak house located in Sioux Falls.

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