The sale and implantation of the fake devices – useless pieces of plastic – jeopardised the health of chronic pain patients and scammed insurers out of millions, according to a March 9 news release from the US Attorney for the Southern District of New York. — Photo by julien Tromeur on Unsplash
The former CEO of a medical device company was arrested after she was accused of intentionally manufacturing “dummy” devices that were implanted into chronic pain patients, US federal officials said.
The sale and implantation of the fake devices – useless pieces of plastic – jeopardised the health of patients and scammed insurers out of millions, according to a March 9 news release from the US Attorney for the Southern District of New York.
Laura Perryman, the former chief executive of Stimwave LLC, a Florida-based neurostimulation device manufacturer, directed the company to create the fake device for “the sole purpose of causing doctors to unwittingly bill Medicare and private insurance companies more than US$16,000 for each implantation of the piece of plastic,” US Attorney Damian Williams stated.
It’s not clear if Perryman has an attorney. A representative for Stimwave could not immediately be reached for comment by McClatchy News.
Perryman, 54, founded Stimwave in 2010 to produce non-opioid alternatives for those with chronic pain. As CEO, she oversaw the creation of a device called StimQ PNS System, which functioned by sending electrical currents through peripheral nerves to stop pain signals from reaching the brain, according to an indictment.
However, around 2017, she embarked on a years-long scheme to design and manufacture a “non-functioning component” of the device, which “served no medical purpose,” officials said.
The dummy component, which measured about 23 centimeters and was surgically implanted near a patient’s nerve, was created exclusively to “make the product financially viable,” according to the release. It allowed medical providers to seek reimbursement from Medicare and other insurers in situations they otherwise would not have been able to, according to the indictment.
As a result, patients underwent unnecessary procedures that put their health at risk, and Medicare was swindled out of millions of dollars, prosecutors said.
Perryman has been charged with conspiracy to commit wire fraud and health care fraud, which has a maximum sentence of 20 years in prison, officials said.
Additionally, federal officials announced a non-prosecution agreement with Stimwave, which stipulates that the firm will pay a US$10mil penalty. A civil fraud lawsuit has also been filed against the company.
Stimwave, headquartered in Pompano Beach, about 10 miles north of Fort Lauderdale, filed for bankruptcy in June. – The Charlotte Observer/Tribune News Service
