KNOXVILLE, Tenn. — The U.S. Attorney’s Office announced it had reached a settlement in a 2020 lawsuit that alleged a Knoxville-area dental provider tried to falsify TennCare claims by using unqualified dental hygienists, upcoding procedures that weren't needed or actually performed, and treating patients like "cattle" in an effort to maximize profits.
According to the U.S. Department of Justice, Dr. Michael Sawaf and his dental company, Premier Dental Group of Knoxville, agreed to pay nearly $1 million to resolve allegations that they knowingly and improperly sent in false claims for dental services to TennCare. Erin Ferdowsi and Reja Ferdowsi are affiliated with the company and also agreed to resolve similar allegations.
The allegations contained in the lawsuit went deeper than just TennCare fraud -- alleging the dental provider potentially put children and other patients in danger and accused them of malpractice.
Sawaf owns and sees patients at Premier Dental Group of Knoxville, formerly known as Orthodontic Designs by Michael Sawaf, which is located on Concord Street in the Marble City neighborhood near Tyson Park. Erin and Reja Ferdowsi were listed as financial investment partners with Premier Dental Group and also ran operations, which included monitoring day-to-day operations, patient schedules, and revenues generated with a particular emphasis on government reimbursement "by any means necessary," according to the lawsuit.
The DOJ said two whistleblowers came forward in Sept. 2019 to report the alleged misdeeds to the government and said they were both forced to resign as a result. The whistleblowers said it happened after the defendants learned they had reported the alleged fraud to the Tennessee Bureau of Investigation and others, saying they had to blow the whistle "much sooner than anticipated" after learning about an incident of "clear malpractice" they said nearly killed a 9-year-old patient.
The two whistleblowers worked out of the Knoxville office as an operations manager and clinic manager. They estimated that roughly 90% of the company's gross revenue came from government programs, such as Medicaid and TennCare, and the remainder came from private insurance or self-pay.
"As a result of the fraudulent practices and conduct described herein, the Defendants have wrongfully and illegally received millions of dollars per year from Government Payors, and in fact, Defendant Erin Ferdowsi has said that the Knoxville office alone was an '$11 million-dollar practice in 2018,'" the lawsuit said.
The DOJ said the company sent in false claims to TennCare for payment relating to various dental procedures. The settlement said between Aug. 14, 2019, and Sept. 11, 2019, the company falsely identified credentialed dentists as the ones who provided services to patients, but in actuality, it said the services were done by non-credentialed workers who were ineligible to bill TennCare -- such as dental hygienists and uncredentialed dentists.
On at least one occasion in July 2019, the whistleblowers alleged the Knoxville office had no credentialed dentists present in the building that day and that Erin Ferdowsi told the office to schedule patients to be seen by dental hygienists at the office.
However, it said the government claims were sent as if a credentialed dentist had seen them. The dentist that was named in the claims had quit earlier that month, but the lawsuit said they continued submitting claims under their name. The lawsuit said the dentist eventually sent a "cease and desist" email to the office.
The government also alleged the defendants routinely upcoded treatment for patients without regard to their safety or needs. The alleged activity included upcoding dental rehab procedures -- especially on younger patients -- to justify the use of sedation, and then also upcoding the number of units of sedation without actually using that listed amount to secure more government reimbursements from procedures. The government alleged the defendants received as much as $3,000 to $10,000 more per patient than they should have received in some cases from TennCare and others.
"...if that much [sedation] was actually used, especially on the younger patients, then it would have seriously injured or even killed the patient," the lawsuit read.
In other cases, the lawsuit alleged the defendants lied to patients about their braces by needlessly extending the wear time for years beyond what they actually needed.
"As a result, Government Payor patients with braces were often kept in braces for up to six (6) years, when the braces were only needed for as little as two (2) years," the lawsuit said.
The lawsuit likened the way the defendants treated their patients and ran their practices to a "mule system" to make as much money as possible "by any and all means necessary," saying Reja Ferdowsi on multiple occasions referred to the patients as "cattle" and "herding cattle" in and out of the practice.
"Employees are held to very unrealistic, if not physically impossible, patient and/or procedure volume 'quotas' on a daily and weekly basis, which is often as high as 75 patients for one dental hygienist on a single day and/or 117 patients for one dental treating provider on a single day, and these quotas encourage and resulted in the fraudulent practices described herein," the lawsuit said.
The issues allegedly came to a head for the whistleblowers with the incident involving the 9-year-old. The whistleblowers alleged the child was not properly sedated as they intubated the child before the oral surgeon arrived at the office, saying the child began gargling on their own blood and experienced bleeding and esophagus sensitivity long after the surgery. They claimed the patient's mother was never told what actually happened and was instead told it was "normal" for the child to experience bleeding.
The whistleblowers said they learned about the incident later that night and met with other employees to discuss the alleged malpractice, saying that's when they decided to report the defendants' conduct to the Fraud Department of the TennCare contractor, DentaQuest, and the Tennessee Bureau of Investigation.
The DOJ said the lawsuit was filed in 2020 under whistleblower provisions, which allows a person to sue on behalf of the government for false claims. The whistleblowers will receive more than $182,000 as part of the more than $985,000 settlement.
10News reached out to Premier Dental Group of Knoxville on Monday evening for a statement about the settlement and lawsuit. It provided a statement on Wednesday.
"The case has been resolved and dismissed. The claims settled are allegations only, and there has been no determination of liability. We do not have any other information at this time," the group said.
Lawyers from The Burkhalter Law Firm in Knoxville represented the whistleblowers.
"After discovering this ongoing conduct, the Relators thereafter made the decision to become whistleblowers. They are to be commended for having the courage to stand up and do the right thing,” said David Burkhalter, one of the lead attorneys in the case.
