Former Owner of Koch Eye Care to Pay $1.1M To Settle Civil Allegations

Former Owner of RI Ophthalmology Chain to Pay $1.1M in Settlement of False Claims Inquiry by the United States


PROVIDENCE – The United States Attorney’s Office has reached an agreement with Paul S. Koch, M.D., the former owner of a chain of Rhode Island ophthalmology practices that bear his name, to resolve civil allegations that Koch paid kickbacks to optometrists who referred patients to him and his practice for cataract surgeries, announced United States Attorney Zachary A. Cunha.


The agreement, under which Dr. Koch will pay $1,166,072, resolves claims brought as part of a qui tam complaint filed in federal court in the District of Rhode Island by two whistleblowers.


“Patients should be able to feel secure that when their doctors make decisions that impact their health- whether about prescriptions, surgeries, or referrals- those decisions are based on sound medical judgment, and not illegal monetary incentives,” said U.S. Attorney Cunha.  “When medical decision making is corrupted by kickbacks, at the expense of federal Medicare dollars, we will hold those responsible to account.”


“Kickback schemes undermine the integrity of medical decisions, subvert the health marketplace and waste taxpayer dollars,” said Special Agent in Charge Phillip M. Coyne of the U.S. Department of Health and Human Services, Office of Inspector General.  “We will continue to hold accountable those who refuse to play by the rules and provide illegal incentives to influence the decision making of health care providers.”


“Kickback schemes can undermine our healthcare system, compromise medical decisions, and waste taxpayer dollars. Today’s settlement makes it clear that medical decisions by doctors should be based on what is best for each patient, not a doctor’s personal financial interest,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. “This unscrupulous scheme orchestrated by Dr. Koch is just one example of how the FBI and are partners are working hard every day to protect patients and federal health care programs from fraud and abuse by removing the corrupting influence of money.”


The government alleged that, during the roughly five-year period between January 1, 2013, through December 31, 2017, Dr. Koch, Koch Eye Associates and Claris Vision, paid financial kickbacks to referring optometrists whose patients elected to receive laser-assisted cataract surgery, for which patients paid up to $2,900 out-of-pocket per eye. The government alleges that these payments to the referring optometrists were illegal under the anti-kickback statute, a federal law that, among other things, prohibits financial payments to induce medical referrals that are reimbursed by federal healthcare payors, like the Medicare program.


In this case, the government alleged that the kickbacks resulted in the submission of false claims to Medicare under the federal False Claims Act. Through this settlement, the government is recovering twice the amount paid by Medicare for claims associated with the illegal kickbacks paid by Dr. Koch and his affiliates.  Under the provisions of the False Claims Act, the whistleblowers will receive $256,534.84 out of the settlement payment.


The government’s case was litigated by Assistant United States Attorneys Dulce Donovan and Bethany N. Wong, and was investigated by the U.S. Department of Health and Human Services, Office of Inspector General and the FBI.