Four Pain Management Clinics Under Investigation for Fraud Closed Abruptly

balance-1172800-1-300x204This month, the abrupt closing of four Tennessee pain management clinics under investigation for state and federal health insurance fraud made headlines.  Those clinics, formerly affiliated with PainMD and rebranded as Rinova, closed last week.  Federal authorities alleged that PainMD and its parent company inflated profits by providing patients with unnecessary injections to be paid by federal health insurance programs.  Authorities of the state of Tennessee initiated their own investigation, with concerns that the conduct of clinic personnel may violate state law.

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In the PainMD pain clinic investigations, not only were the companies and clinic administrators at risk for financial penalties and reputational harm in connection with potential fraud, but so were the health providers who worked at those clinics.  Three PainMD nurses were indicted on federal charges in connection with procedures provided at the Tennessee clinics under investigation.

In the wake of rampant overuse of narcotics, resulting in major health problems and deaths from overdose by individuals who may have become addicted to pain medicine initially provided by physicians and other healthcare providers, many states have enacted strict laws concerning the operation of pain clinics.  For example, the Florida and Georgia legislatures passed laws between 2010 and 2013 to regulate pain clinics. Georgia’s law, the Georgia Pain Management Clinic Act (HB 178), was nicknamed the “Pill Mill Bill.”  Detailed discussion of this law is in an online article by David W. Gale, MD for Georgia’s law was in reaction to increased restrictions on pain clinics imposed by the state of Florida, which caused operators of pain clinics to migrate to Georgia to distribute prescriptions.  Essentially, Georgia’s law provides that medical practices where more than fifty percent (50%) of the patient population receives Schedule II or III controlled substances to treat chronic pain must be licensed by the Georgia Composite Medical Board (GCMB).  The GCMB is an oversight board charged with regulating the practice of medicine in Georgia. The law imposed appropriate scrutiny to reduce the number of disreputable pain clinics and to facilitate qualified, licensed Georgia physicians establishing reputable pain clinics for patients who legitimately need pain management treatment.

The GCMB published detailed rules for operating a Georgia pain clinic in Chapter 360-8: Pain Management Clinics consistent with State law, which are available online.  These rules include standards for operating pain clinics, applying for a new clinic license, denial of licensure, requirements for notifications to the GCMB, annual reporting, disciplinary action and reinstatement.  The rules impose a specific annual reporting requirement to hospital clinics, which must report by March 1st of each year on a form approved by the GCMB the notification of its operation of any outpatient clinic at its main facility or a satellite facility with greater than 50% of that clinic’s annual patient population being treated for chronic pain for non-terminal conditions by the use of Schedule II or III controlled substances.  See GCMB Rule 360-8-.08.  The rules define “chronic pain” as physical pain treated for a period of 90 days or more in a year but shall not include perioperative pain, which shall mean pain immediately preceding and immediately following a surgical procedure, when such perioperative pain is being treated in connection with a surgical procedure by a licensed health care professional acting within the scope of his or her license.  See

Of course, understanding and compliance with these healthcare rules and law is essential to protect the practice and reputation of healthcare providers seeking to provide high quality pain management treatment services for patients with chronic pain.  Our Georgia and South Carolina business and healthcare law firm provides advice and counsel to physicians, nurses, nurse practitioners, physician assistants and other healthcare providers concerned with compliance with pain management and other federal and state laws and regulations.  If you have questions about this post, contact our firm at (404)-685-1662 (Atlanta), (706) 722-7886 (Augusta) or .


** Disclaimer: Thoughts shared here do not constitute legal advice. Please consult with an attorney to discuss your legal issue.

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