A Florida orthopedic surgeon and designer of costly spinal surgery implants was arrested Tuesday and charged with paying millions of dollars in kickbacks and bribes to surgeons who agreed to use his company’s devices.
Dr. Kingsley R. Chin, 57, of Fort Lauderdale, Florida, is the founder, chief executive officer and owner of SpineFrontier, a device company based in Malden, Massachusetts. He and the company’s chief financial officer, Aditya Humad, 36, of Cambridge, Massachusetts, were each indicted on one count of conspiring to violate federal anti-kickback laws, six counts of violating the kickback statute and one count of conspiracy to commit money laundering, officials said.
The indictment alleges that SpineFrontier, Chin and Humad paid surgeons between $250 and $1,000 per hour in sham consulting fees for work they did not perform. In exchange, the surgeons agreed to use SpineFrontier’s products in operations paid for by federal health care programs such as Medicare and Medicaid. Surgeons accepted between $32,625 and $978,000 in improper payments, according to the indictment.
“Kickback arrangements pollute federal health care programs and take advantage of patient needs for financial gains,” said Nathaniel Mendell, acting U.S. attorney for the District of Massachusetts.
“Medical device manufacturers must play by the rules, and we will keep pursuing those who fail to do so, regardless of how their corruption is disguised.”
Chin and SpineFrontier were the subjects of a KHN investigation published in June that found that manufacturers of hardware for spinal implants, artificial knees and hip joints had paid more than $3.1 billion to orthopedic and neurosurgeons from August 2013 through 2019. These surgeons collected more than half a billion dollars in industry consulting fees, federal payment records show.
Chin, a self-styled “doctorpreneur,” formed SpineFrontier about a decade after completing his training at Harvard Medical School.
Chin has patented dozens of pieces of spine surgery hardware, such as doughnut-shaped plastic cages, titanium screws and other products that generated some $100 million in sales for SpineFrontier, according to government officials. In 2018, SpineFrontier valued Chin’s ownership of the company at $75 million, though its current worth is unclear. He maintains a medical practice in Hollywood, Florida. Neither Chin nor Humad could be reached for comment Tuesday.
Seth Orkand, a Boston attorney who represents Humad, said his client “denies all charges, and looks forward to his day in court.”
The Department of Justice filed a civil lawsuit against Chin and SpineFrontier in March 2020, accusing the company of illegally funneling more than $8 million to nearly three dozen spine surgeons through the “sham” consulting fees. Chin and SpineFrontier have yet to file a response to that suit.
However, at least six surgeons have admitted wrongdoing in the civil case and paid a total of $3.3 million in penalties. Another, Dr. Jason Montone, 45, of Lawson, Missouri, pleaded guilty to criminal kickback charges and is set to be sentenced early next year. Federal law prohibits doctors from accepting anything of value from a device-maker for agreeing to use its products, though most offenders don’t face criminal prosecution.
The grand jury indictment lists seven surgeons as having received bribes totaling $2,747,463 to serve as “sham consultants.” One doctor, identified only as “surgeon 7,” received $978,831, according to the indictment. Many of the illicit payments were made through a Fort Lauderdale company controlled by Chin and Humad, according to the indictment.
The SpineFrontier executives set up the separate company partly to evade requirements for device companies to report payments to surgeons to the government, according to the indictment. Some surgeons were told they could bill for more consulting hours if they used more expensive SpineFrontier products, officials said.
Conspiring to violate the kickback laws can bring a sentence of up to five years in prison, while violating the kickback laws can result in a sentence of up to 10 years, officials said.
“Kickbacks paid to surgeons as sham medical consultants, as alleged in this case, cheat patients and taxpayers alike,” said Phillip Coyne, special agent in charge of the U.S. Department of Health and Human Services Office of Inspector General.
“Working with our law enforcement partners, we will continue to investigate kickback schemes that threaten the integrity of our federal health care system, no matter how those schemes are disguised.”
Fred Schulte, Kaiser Health News
Kaiser Health News
Kaiser Health News is a nonprofit news service covering health issues. It is an editorially independent program of the Kaiser Family Foundation, which is not affiliated with Kaiser Permanente.
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