Doctor at Advanced Pain Care Settles $13.6M Urine Drug Testing Case

In a significant case highlighting ongoing scrutiny of healthcare billing practices, an Austin-based pain specialist and his medical practice have reached a multimillion-dollar settlement with federal and state authorities over allegations of improper billing for drug tests.

Dr. Mark Malone, founder of Advanced Pain Care, along with more than a dozen related entities, has agreed to pay $13.6 million to resolve claims that they violated the federal False Claims Act and Texas law. The vast majority of the settlement—approximately $13.57 million—will go to the federal government, while Texas will receive about $34,000.

Advanced Pain Care operates numerous pain medicine clinics and surgical centers throughout Texas, with locations in Austin, Amarillo, Waco, and Houston. The practice specializes in interventional pain management under Malone’s leadership.

According to federal prosecutors, from 2017 through 2021, Malone and Advanced Pain Care knowingly submitted false claims to government health programs including Medicare, Medicaid, and TRICARE for urine drug tests that were medically unnecessary. The authorities allege that the practice routinely ordered and billed for both preliminary and more sophisticated drug tests for the same patients on the same day, without first reviewing the initial results to determine whether additional testing was actually needed.

The government’s case also claimed that when billing the Department of Veterans Affairs, the practice used multiple billing codes for individual drug analytes, artificially inflating the reimbursements they received.

“Some, like Dr. Malone, instead cause harm by submitting false claims for procedures, thereby enriching themselves to the detriment of the American taxpayer,” U.S. Attorney Justin Simmons said in a statement. “These settlements demonstrate my office’s commitment to protect the healthcare programs on which the American people have come to rely.”

The case reflects a broader trend of increased federal enforcement against healthcare fraud, particularly involving unnecessary testing. Healthcare fraud costs taxpayers billions annually, with the Department of Justice recovering more than $5.6 billion from civil cases involving fraud and false claims in fiscal year 2021 alone.

As part of the resolution, Advanced Pain Care has entered into a five-year corporate integrity agreement with the Office of Inspector General for the U.S. Department of Health and Human Services. Under this agreement, the practice must implement enhanced compliance measures, including strengthened oversight, regular risk assessments, and the retention of an independent organization to review claims before they are submitted for payment.

Corporate integrity agreements have become standard components of healthcare fraud settlements, designed to prevent recurrence and reform billing practices. They typically impose significant administrative and financial burdens on healthcare providers but offer an alternative to more severe sanctions like exclusion from federal healthcare programs.

The settlement resolves allegations raised in five separate lawsuits. Federal authorities emphasized that the claims against Malone and Advanced Pain Care remain allegations only, and there has been no determination of liability in court.

Urine drug testing has become a focal point for healthcare fraud investigations in recent years, particularly in pain management practices where testing is common. While such testing can be a legitimate tool for monitoring patient adherence to prescribed medications and detecting unauthorized drug use, authorities have increasingly scrutinized practices that appear to use testing primarily as a revenue generator rather than as a clinically necessary service.

The settlement underscores the continued focus by federal and state authorities on combating healthcare fraud, particularly in high-cost sectors of the healthcare industry such as pain management.