Gov't Emps. Ins. Co. v. AFO Imaging, Inc.

• Decision Date: 25 February 2021
• Docket Number: Case No. 8:20-cv-2419-VMC-CPT
• Court: U.S. District Court — Middle District of Florida
• Parties: GOVERNMENT EMPLOYEES INSURANCE CO., GEICO INDEMNITY CO., GEICO GENERAL INSURANCE COMPANY, and GEICO CASULTY CO., Plaintiffs, v. AFO IMAGING, INC. d/b/a ADVANCED DIAGNOSTIC GROUP, RADIOLOGY IMAGING SPECIALISTS, LLC d/b/a CAREFIRST IMAGING, KEVIN JOHNSON, CHINTAN DESAI, ROBERT D. MARTINEZ, and STANLEY ZIMMELMAN, Defendants.

GOVERNMENT EMPLOYEES INSURANCE CO., GEICO INDEMNITY CO.,GEICO GENERAL INSURANCE COMPANY, and GEICO CASULTY CO., Plaintiffs, v. AFO IMAGING, INC. d/b/a ADVANCED DIAGNOSTIC GROUP,RADIOLOGY IMAGING SPECIALISTS, LLC d/b/a CAREFIRST IMAGING,KEVIN JOHNSON, CHINTAN DESAI, ROBERT D. MARTINEZ,and STANLEY ZIMMELMAN, Defendants.

Case No. 8:20-cv-2419-VMC-CPT

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA TAMPA DIVISION

February 25, 2021

ORDER

This matter comes before the Court upon consideration of Defendants AFO Imaging, Inc. d/b/a Advanced Diagnostic Group, Kevin Johnson, Dr. Chintan Desai, Dr. Robert D. Martinez, and Dr. Stanley Zimmelman's (collectively, the "Advanced Diagnostic Defendants'") Motion to Dismiss (Doc. # 36), filed on January 4, 2021. Plaintiffs Government Employees Insurance Co., Geico Indemnity Co., Geico General Insurance Company, and GEICO Casualty Co. responded on January 19, 2021. (Doc. # 46). For the reasons set forth below, the Motion is denied.

I. Background

Plaintiffs are motor vehicle insurers that have reimbursed Defendants for certain personal injury protection insurance ("PIP insurance") covered radiology procedures. (Doc. # 1 at ¶¶ 1, 9). Defendants are medical diagnostic centers and medical diagnostic center owners or directors. (Id. at ¶¶ 10-15). Advanced Diagnostic owns and operates multiple Florida diagnostic centers, with eight locations in Tampa, Brandon, Lakeland, Kissimmee, Orlando, and Palm Beach Gardens. (Id. at ¶ 10). During the relevant time periods, Plaintiffs allege that Kevin Johnson was the owner of Advanced Diagnostic. (Id. at ¶ 12). Dr. Chintan Desai is a radiologist who serves or served as the medical director of Advanced Diagnostic's Tampa, Brandon, and Orlando locations. (Id. at ¶¶ 11, 15). Dr. Robert Martinez is a physician who serves or served as the medical director of Advanced Diagnostic's Lakeland location. (Id. at ¶ 13). Dr. Stanley Zimmelman is a physician who serves or served as the medical director of four of Advanced Diagnostic's locations - in Tampa, Palm Beach Gardens, Kissimmee, and Orlando. (Id. at ¶ 14).

Plaintiffs aver that the Advanced Diagnostic Defendants entered into two related fraudulent schemes. First, Defendants allegedly submitted or caused to be submittedthousands of PIP insurance charges for medically unnecessary, falsified radiology services, namely for magnetic resonance imaging ("MRIs"). (Id. at ¶¶ 1, 7). Second, the Advanced Diagnostic medical centers allegedly operated in violation of Florida law because their medical directors failed to properly perform their duties. (Id. at ¶¶ 120-38).

In the first alleged fraudulent scheme, Plaintiffs aver that the Advanced Diagnostic Defendants repeatedly billed them for medically unnecessary MRIS from at least 2015 to the present. (Doc. # 1 at ¶ 48). In support of this allegation, Plaintiffs provide a substantial number of examples of PIP-covered patients who were "involved in relatively minor, low-speed, low-impact 'fender-bender' accidents," and sustained only minor, soft tissue injuries - to the extent that they suffered any injuries at all. (Id. at ¶¶ 50-52, 53). These patients either did not seek treatment at a hospital following their accident or were discharged shortly thereafter without being admitted. (Id. at ¶ 51). Following these relatively minor accidents, the patients visited an Advanced Diagnostic clinic, where an employee performed an MRI as an initial diagnostic tool, despite the fact that "[i]n a legitimate clinical setting, MRIs should not be used as an initial form of diagnostic testing in the treatment of patientscomplaining of soft tissue injuries such as sprains secondary to automobile accidents." (Id. at ¶¶ 55-58, 63). This is because most "soft tissue injuries such as sprains and strains will resolve over a period of weeks through conservative treatment, or no treatment at all." (Id. at ¶ 66).

Not only did a substantial number of patients involved in these minor accidents receive MRIs, but they also received substantially the same MRIs. (Id. at ¶ 70). The Advanced Diagnostic Defendants "routinely purported to perform and/or provide both cervical and lumbar MRIs with respect to [patients] who had not been seriously injured in their accidents, did not plausibly require both cervical and lumbar MRIs (or any MRIs), and in any case did not require cervical and lumbar MRIs as a first-line diagnostic test, before they had failed a legitimate course of conservative treatment." (Id. at ¶ 71). This is also despite the fact that these patients were different ages, heights, weights, were in different physical conditions and locations within the vehicle, and the locations of impact differed. (Id. at ¶¶ 73-78). Plaintiffs provide a number of representative examples. (Id. at ¶ 79). For instance:

On June 28, 2017 two Insureds - JK and KG - were involved in the same automobile accident. JK and KG were different ages, in different physicalcondition, and experienced the impact from different positions in the vehicle. To the extent that they suffered any injuries at all in the accident, their injuries were different, and resolved at different rates. They did not require substantially identical MRIs on the same date as their accident. Even so, Advanced Diagnostic, Johnson, Zimmelman, and Desai submitted bills to GEICO for MRI scans purportedly performed on the cervical spine and lumbar spine of both JK and KG at AD-Kissimmee on June 28, 2017.

* * *

On March 29, 2019, two Insureds - BD and JD - were involved in the same automobile accident. BD and JD were different ages, in different physical condition, and experienced the impact from different positions in the vehicle. To the extent that they suffered any injuries at all in the accident, their injuries were different, and resolved at different rates. They did not require substantially identical MRIs on or about the same date after their accident. Even so, Advanced Diagnostic, Johnson, Martinez, and Desai submitted bills to GEICO for MRI scans purportedly performed on the cervical and lumbar spines of BD and JD at AD-Lakeland on April 18, 2019.

(Id.).

After performing these unnecessary MRIs, Plaintiffs allege that the Advanced Diagnostic Defendants falsely diagnosed these patients "in order to make it appear as if the [patients] had suffered from serious injuries as the result of their automobile accidents, when in fact they had not." (Id. at ¶ 83). In support of this, Plaintiffs provide a number of examples of Advanced Diagnostic patients who wereinvolved in these aforementioned minor automobile accidents, who did not visit a hospital or were discharged without being admitted, and were then diagnosed with serious disc bulges and "numerous herniations at multiple levels of their spines" at Advanced Diagnostic. (Id. at ¶ 84). The physicians made these diagnoses despite the fact that it is "improbable that a minor accident actually would cause a patient to suffer from numerous bulging discs at multiple levels of his or her spine," and that it is equally as unlikely that this would "occur over and over again within a large cohort of patients being treated within a small group of related radiology practices." (Id. at ¶¶ 94-95). For example:

On July 19, 2018, an Insured named KM was involved in a minor automobile accident. In keeping with the fact that the accident was minor, KM was not seriously injured and was discharged from the hospital emergency room hours after arriving without being admitted to the hospital. To the extent that KM experienced any health issues at all as the result of the accident, they were minor soft tissue injuries that did not require MRIs, not disc herniations. Even so, after purportedly taking MRIs of KM's cervical spine and lumbar spine at AD-Lakeland on July 31, 2018, Advanced Diagnostic, Johnson, Martinez, and Desai falsely reported that KM had disc herniations at the C3-4 and L5-S1 levels of her spine.

* * *

On August 4, 2018, an Insured named EC was involved in a minor automobile accident. In keeping with the fact that the accident was minor, EC was notseriously injured and was discharged from the hospital emergency room hours after arriving without being admitted to the hospital. To the extent that EC experienced any health issues at all as the result of the accident, they were minor soft tissue injuries that did not require MRIs, not disc herniations. Even so, after purportedly taking MRIs of EC's cervical spine and lumbar spine at AD-Orlando 2 on September 6, 2018, Advanced Diagnostic, Johnson, Zimmelman, and Desai falsely reported that EC had disc herniations at the C3-4, C4-5, C6-7, L3-4, L4-5, and L5-S1 levels of her spine.

(Id. at ¶ 86).

Additionally, Plaintiffs allege that Dr. Desai, who worked remotely and was responsible for interpreting these MRIs, made these diagnoses without personally examining the patients, and without referencing those patients' medical records. (Id. at ¶¶ 103-04). Despite not referencing those materials, a number of Dr. Desai's reports indicated that these disc herniations and bulges were caused by the automobile accidents in question. (Id. at ¶¶ 105-06). And, Dr. Desai allegedly interpreted sixty to seventy MRIs per day that were then submitted to Plaintiffs, which Plaintiffs proffer indicates that they were not properly reviewed. (Id. at ¶¶ 110-14). Taking these allegations together, Plaintiffs posit that the Advanced Diagnostic Defendants exaggerated these diagnoses in order "to ensure a steady stream of referrals to [their clinics] for medically unnecessary MRIs."(Id. at ¶ 88). Defendants were allegedly then enriched by this fraud by billing Plaintiffs for these MRIs - with Dr. Desai, Dr. Martinez, and Dr. Zimmelman as medical directors of the various clinics, and Johnson as the purported owner. (Id. at ¶¶ 2, 10-15, 139-40).

In the second related scheme, Plaintiffs allege that the Advanced Diagnostic clinics operated in violation the Florida Health Care Clinic Act's...