HomeLocal News

Chattanooga-based eye clinic settles for $17M after allegations of kickbacks, false claims

From NewsChannel 9: A Chattanooga-based eye surgery clinic has agreed to pay Tennessee and the federal government $17 million to settle claims it violated anti-kickback statutes to induce optometrists to send business their way.


SouthEast Eye Specialists, together with SouthEast Eye Surgery Center and the Eye Surgery Center of Chattanooga (SEES), agreed to pay the settlement to resolve allegations that they violated the Anti-Kickback Statute by illegally inducing primary-care eye doctors to refer – or steer –patients to SEES for cataract surgeries by providing optometrists a variety of forms, according to Phillips & Cohen, LLP, one of two law firms that represented two whistleblowers in the case.


Those whistleblowers are Ross Lumpkin, O.D. an optometrist in Tennessee, and Gary Odom, who served as an executive in the statewide optometric association for decades.


The pair claimed SEES


…used a variety of approaches to secure a stream of referrals by inducing optometrists to refer patients to SEES, including continuing education, meals, sporting events, and inappropriate pre-arranged co-management agreements with optometrists,’ according to Phillips & Cohen.

When surgery for cataracts is co-managed, the surgeon gets 80% of the Medicare reimbursement, and the referring optometrist gets 20% of it.


The settled complaint says SEES “corrupted this relationship by using it to serve its own interests and the interests of its referring optometrists over the interests of the patients.”


But, the firm says,


Under the SEES model, referrers and referees blanketly pre-arranged for patients to have their surgery performed by SEES and to have it co-managed,’ saying that this may violate the Anti-Kickback Statue.

“Dr. Lumpkin and Mr. Odom exposed fraud on the government and the taxpayers by shining a light on what happens when a permissible practice is corrupted by financial interest rather than staying focused on patient need. When healthcare providers pay kickbacks to obtain business from other providers, honest companies and honest providers cannot compete, and the entire system suffers,” said Jennifer Verkamp of Morgan Verkamp.

Read the full complaint below.


SEES provide us with the following statement:


Since 2017, SouthEast Eye Specialists has been litigating allegations concerning our business model. Throughout this case, we have believed that the defense of our approach to eye care has been important for our patients and the eye care industry more broadly. We have refuted the allegations leveled against us and vigorously defended our position at every turn.

While we have not wavered in our view of the merits, we have reached a settlement to conclude this litigation and to eliminate any further financial, administrative, and operational burden on our organization stemming from this matter. The settlement is a deliberate decision by our Board to put this matter behind us, allowing us to move forward with implementing exciting strategic initiatives and focusing dedicated resources toward our strong growth trajectory. It is important to note that there was no finding of any wrongdoing whatsoever. We continue to firmly believe that our practice was and continues to be in compliance with all applicable legal and medical ethical requirements and guidelines and we continue to hold ourselves to the very highest legal, ethical and compliance standards.

As we always have, we believe the challenges to our business practices have been and are without merit, and we are resolute in upholding our model of care where physicians work together to provide exceptional patient care. Now, we look forward to directing all our energy into what we do best – providing the best medical and surgical eye care and experience possible to the patients we serve.