New Jersey Manufacturers Insurance Company

WEST TRENTON, N.J. — Superior Court of New Jersey has concurred with New Jersey Manufacturers Insurance Company (NJM) in its civil lawsuit filed against Dr. Alan E. Ottenstein, M.D., entering a judgment of $2,782,096 in favor of the Insurance Company in a case that has been more than five years in the making.

Based on findings by its Special Investigations Unit (SIU), NJM filed suit in 2001. The complaint indicated that Ottenstein, a neurologist with offices in Lawrenceville and Hamilton, NJ, falsely represented that he injected steroids into the epidural area of the spine to reduce pain suffered by patients who had been in automobile accidents. The treatments and subsequent billings took place between 1994 and 2000.

In fact, Ottenstein and his associates merely shot pain-killing drugs into the muscle around the spine. While this is similar to a much simpler practice known as "trigger-point" injections, NJM argued successfully that the procedures performed had no medical merit and therefore were not reimbursable at all. Insurance companies compensate at a much higher rate for actual epidural injections, which require fluoroscope guidance and a much greater level of skill.

NJM sought and received a judgment covering reimbursement of all medical fees paid to Ottenstein, investigation expenses, and legal costs related to the case, plus interest. NJM also sought treble damages, pursuant to the New Jersey Insurance Fraud Prevention Act. Consequently, the $927,365.37 in total investigation costs and attorney fees plus fraudulent medical payments has been tripled to $2,782,096.11.

The order was issued by New Jersey Superior Court Judge Bill Mathesius, sitting in Trenton. NJM was represented in the case by McLaughlin & Cooper, Trenton.

New Jersey Manufacturers Insurance Company operates exclusively for the benefit of policyholders. Through prudent underwriting and careful stewardship, NJM has returned more than $4.2 billion in dividends to policyholders since 1918. NJM has long been the Garden State's largest provider of Workers' Compensation and a leading writer of Personal Auto, Commercial Auto and residential coverage.

"Securing this judgment is a great accomplishment for our SIU," said Anthony G. Dickson, President and CEO of NJM Insurance Group. "But medical fraud involves more than just money. While most medical practitioners have the utmost concern for the well-being of their patients, dishonest doctors may take risks that can endanger their patients. Doctors who are proven to be dishonest should lose their licenses, be prosecuted to the fullest extent of the law, and be sent to jail."

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