Minneapolis-based company Precision Lens has settled for $12 million with the U.S. government after accusations of unethical conduct involving kickbacks to ophthalmic surgeons – a series of violations against the False Claims Act and the Anti-Kickback Statute. The agreement, confirmed on July 24, stems from allegations that the company engaged in providing lavish perks to physicians in exchange for using their products in Medicare-reimbursed cataract surgeries, as detailed in a Justice Department announcement.
These illicit incentives, as the case outlined, included high-end ski trips, private jet rides to major sporting events, and deep discounts on frequent flyer miles, among others. The jury in the February 2023 trial found this persuaded doctors to favor Precision Lens’ products, resulting in a staggering $43.7 million in fraudulent Medicare claims, and although the court initially slapped the firm and its then-owner, Paul Ehlen, with a $487 million judgment, this figure was later reduced to $216.7 million after reviewing the defendants’ financial state and ability to foot the bill.
In the aftermath, the estate of the company's former principal Paul Ehlen, now deceased, partnered with Precision Lens in the settlement that tops off nearly $27 million reclaimed by the government across related prosecutions. The case against Precision Lens sprang from whistleblower actions initiated by Kipp Fesenmaier, invoking the qui tam provisions that allow citizens to sue on behalf of the U.S. and share in the financial recoveries; these provisions played a key role in the pivotal lawsuit captioned United States of America, et al., ex rel. Fesenmaier v. The Cameron-Ehlen Group, Inc., d/b/a Precision Lens, et al., Case No. 13-cv-3003.
While this settlement closes a chapter on the Precision Lens saga, it echoes actions from related cases including Sightpath Medical, Inc., TLC Vision Corporation, and their former CEO, James Tiffany, who settled for $12 million, and Dr. Jitendra Swarup, whose kickback acceptance cost him upwards of $2.9 million in a settlement agreement. U.S. Attorneys Bahram Samie and Andrew Tweeten, in conjunction with the Office of Inspector General of the U.S. Department of Health and Human Services and the FBI, collaborated in the pursuit of justice against these fraudulent practices which, over time, corrupt the sanctity of medical decision-making and inflate healthcare costs for all – especially the vulnerable demographic reliant on Medicare.
