Posted 8/18/2014 12:00 am
Updated 4 months ago
For years, attempts to curb the “runners” who persuade auto accident victims to seek treatment from a particular chiropractor have failed — until now.
A combination of regulation and enforcement has begun to chip away at the lucrative business plan that has generated so many complaints that the Arkansas State Board of Chiropractic Examiners had to add another full-time staff position.
State legislation that took effect a year ago requires runners, officially known as “procurers,” to register with the board and disclose which chiropractors are paying for their services. In its wake:
- The board agreed in February to spend $10,000 on two private investigators to look into complaints about runners.
- The board used an April hearing into a complaint against Sherwood chiropractor Mark Varley to ask questions about the tactics of a runner whose pitch had fooled even an attorney. Varley was found not guilty of unprofessional conduct.
- On June 23, shortly after the board announced that it would hire a third employee “particularly [because of] complaints involving chiropractic procurers,” Arkansas Attorney General Dustin McDaniel sued longtime runner Roger Pleasant of Maumelle, his employees and several of his businesses for deceptive trade practices.
The lawsuit attacks the business model of combing through police reports for names, addresses and phone numbers of people involved in auto accidents and then persuading them to visit a chiropractor who may be paying the runner up to $600 per patient.
- Two days after McDaniel’s office filed the complaint in Pulaski County Circuit Court, chiropractors Heath Lenox of Little Rock and Daniel Scott Morris of North Little Rock stopped using Pleasant and his companies as procurers, according to the registration record that the chiropractic board started to keep last August.
- Lenox, whose use of Pleasant and his companies racked up the single largest number of complaints pending when the board last met on July 24, has agreed to a $24,000 fine and three years of probation with the licensing board.
“To me, it’s a consumer protection issue,” said Fort Smith attorney Joey McCutcheon, who has been advocating limits on runners for years. “Oftentimes, folks are preyed on who really don’t know that the decisions that they’re making are really going to hurt them in the long run. And the only people who are benefiting are the runner and the chiropractor.”
Even the state association of chiropractors has wanted to rein in the practice.
“We’re all working toward the same goal, which is to make sure that people aren’t being misled or taken advantage of when they’re in a vulnerable state,” said Robbie Wills of Conway, an attorney and lobbyist for the Arkansas Chiropractic Physicians Association.
‘Deceptive Tactics’ Alleged
In its first lawsuit against a chiropractic runner, the AG’s office is seeking an injunction against Roger Pleasant and his businesses, which operate under names that include PSG & Investigation LLC, Accident Claim Service LLC, Physician 1st Marketing Group LLC and Network Collision Group LLC.
The lawsuit also names Pleasant’s son, Rogerick Pleasant, and James “Jimmy” Hinton and Brian Hinton, both of Little Rock. The lawsuit is seeking unspecified damages.
“These chiropractic runners use many deceptive tactics in their attempts to force a consumer to seek chiropractic treatment,” McDaniel said in a news release announcing the lawsuit. “They may pose [as] insurance agents or claims adjusters and may call at all hours of the day or night.”
Roger Pleasant’s attorney, Willard Proctor Jr. of Little Rock, has asked that the lawsuit be dismissed because it was filled with generalities and no specific information such as the names of the victims or when the alleged acts took place.
“There’s no way that you could sufficiently be able to respond to the complaint, and so that’s a problem,” Proctor told Arkansas Business last week. “Of course, we deny any sort of inappropriate action done by any of the defendants.”
His motion for dismissal is pending.
Proctor said he thinks Pleasant was singled out because he “has been doing it the longest and [was] probably the most successful.” He said he thinks the AG’s office is trying to make an example out of Pleasant “and hopes that the others would fall in line,” he said. “But that’s my guess. I don’t know for sure.”
If Proctor is right, then the lawsuit seems to be working.
R. David Lewis, the Little Rock attorney representing chiropractor Heath Lenox, confirmed last week that his client had fired Pleasant, whose companies were the only ones on record as working for Lenox. (Morris, the other chiropractor who stopped using Pleasant, couldn’t be reached for comment.)
Of the 78 complaints the board had pending against chiropractors as of July 24, 13 were against Lenox and all but one was related to the tactics his runners used to pressure potential patients to come to his office for treatment.
Lenox has agreed to plead no contest to the complaints, pay a $24,000 fine and be placed on three years of probation to settle the allegations. Under the agreement, the board would dismiss two of the complaints against Lenox. As of last week, the consent order was being drafted and hadn’t been signed.
Lewis, the attorney, said Lenox decided to settle because he didn’t want to fight the charges anymore.
The attorney general’s office said it might file more lawsuits against runners who act outside of the regulations.
“If we find evidence of similar practices by others, then we would consider filing lawsuits against those companies or individuals as well,” Aaron Sadler, a spokesman for the attorney general’s office, said in an email to Arkansas Business last week. “Thus far, our focus has been on runners because the Board has within its authority the ability to sanction chiropractors that the Board believes are acting illegally.”
Wills, the lobbyist for the chiropractors association, said the board could take a chiropractor’s license for the actions of the runner. That hasn’t happened yet, “but I wouldn’t be surprised if it doesn’t happen in the near future,” Wills said.
For more than a decade, the chiropractic association has been trying to limit chiropractors’ use of runners. But opponents faced a huge hurdle: a 2001 state Supreme Court ruling that said regulation limiting chiropractors’ use of a telemarketing firm to attract clients was “an unconstitutional infringement on commercial speech, in violation of the First Amendment.”
Other attempts to stop the runners also failed. In the 2011 legislative session, a bill that would have placed a 60-day waiting period on a medical provider’s use of information from police reports for the purpose of selling a service failed to get out of committee.
But Wills was able to push through Act 513 in 2013. While the legislation doesn’t limit the use of runners, it requires them to register with the Chiropractic Board. As of last week, 68 procurers were registered.
The legislation also allows the board to regulate the procurers, authority the board did not previously have, which made it difficult to prove that a runner had been paid by a particular chiropractor.
With the new law, Wills said, a paper trail is established between the doctor and the procurer.
“If a complaint is brought, that should help build a case against someone who is being a bad actor,” Wills said.
Lawyer Perceives Fraud
The difficulty of proving which runner was employed by which chiropractor was highlighted in a complaint filed by Bill Wharton of Conway, a staff attorney for the Arkansas Highway & Transportation Department, against Sherwood chiropractor Mark Varley.
The board held a hearing on his complaint on April 17, and it opened a window into the world of chiropractors and runners.
Wharton testified that he was in an auto accident on Dec. 3, 2012, eight months before the registration regulations took effect. The next day, Wharton received a call at work from a woman who said she represented the insurance company for the other driver. She told Wharton that the other driver’s insurer was accepting liability for the accident, but she wanted to make sure that he was not injured. She directed him to Varley’s clinic, so Wharton went there that day.
Only after he received a bill from his insurance carrier did Wharton realize that something “fraudulent had occurred,” he told the board. He said he was lied to by the woman who called him.
After Wharton complained, Varley wrote off the bill. Wharton filed the complaint anyway under the assumption that the caller worked for Varley.
Like Lenox, Varley is represented by attorney David Lewis. Under cross examination, Lewis asked Wharton if the woman could have worked for a competitor who wanted to cause trouble for Varley.
Wharton conceded that scenario could be true, but he considered it unlikely. “I’ve never seen anyone go to those kinds of steps to enrich an enemy,” Wharton said.
But Lewis said he’s seen it happen. “There are some of these complaints that can be … traced to other chiropractors,” Lewis said at the hearing. “And those people have an interest in filing grievances against Dr. Varley because they are trying to limit their competition. There is a lot of that going on, and it’s really a nasty situation.”
Varley testified that he didn’t have a woman working for him as a runner in December 2012. But he acknowledged using runners and said they try to call as many accident victims as they can in a day.
He also said he paid the procurers $600 for each referred patient who makes at least five visits to his office.
After the hearing, the chiropractic board found Varley not guilty of unprofessional conduct on a 3-2 vote.
Wharton told Arkansas Business last week that he was disappointed with the verdict but not surprised. “We knew we were going to have a proof problem,” he said.
Varley, through his office, referred questions to another attorney, Steve Underwood of Cabot. Underwood said Varley makes sure the procurers he uses follow the rules when contacting an accident victim. And he said the procurers now are starting to record the sales calls, so there’s a record to review if there is a dispute.
Underwood also said Varley has used runners for years to help build his business. A medical doctor will refer his patients to a physical therapist, but not to a chiropractor, Underwood said. “So that means they’ve got to be aggressive in getting a patient base built up,” he said.