Appleton Medical Clinic Medicare Fraud Settlement, What Wisconsin Patients Need to Know

Appleton Clinic Pays $382,362.95 for Billing Medicare Illegally

Appleton Medical Clinic and its owner, Dr. Michael Johnson, agreed to pay $382,362.95 to the U.S. government to resolve allegations that they submitted false claims to Medicare for treatments that were not medically necessary and not covered by the program. The U.S. Attorney’s Office for the Eastern District of Wisconsin announced the settlement on April 17, 2026. Neither the clinic nor Dr. Johnson admitted wrongdoing. This is not a class action — patients cannot file claims for a share of this settlement. However, if you were a Medicare patient at Apple Medical Clinic and received these treatments, there are steps you can take.

Quick Facts Table

Field	Detail
Defendant	Appleton Medical Clinic & Dr. Michael Johnson
Location	Appleton, Wisconsin
Settlement Amount	$382,362.95
Payment Structure	$175,000 cash + $207,362.95 retained by CMS
Law Violated	False Claims Act, 31 U.S.C. §§ 3729–3733
Investigating Agency	HHS Office of Inspector General (OIG)
Prosecuting Office	U.S. Attorney’s Office, Eastern District of Wisconsin
Admitted Wrongdoing?	No
Treatments at Issue	Electrical muscle stimulation (Sanexas device), vitamin injections, epidermal nerve fiber density testing
Related Case	RST-Sanexas, Inc. — $1.5 million settlement (Eastern District of Pennsylvania)
Open Patient Claim Form	None — this is a government enforcement action
Announcement Date	April 17, 2026

Current Status & What Happens Next

• The settlement was announced April 17, 2026, by Brad D. Schimel, First Assistant U.S. Attorney for the Eastern District of Wisconsin. The case is resolved.
• The settlement amount reflects the clinic’s ability to pay — not the full alleged fraudulent billing amount. The U.S. government retained $207,362.95 already held by the Centers for Medicare & Medicaid Services (CMS) and will receive a $175,000 cash payment.
• The device manufacturer, RST-Sanexas, Inc., previously resolved its own False Claims Act allegations in a separate $1.5 million settlement through the Eastern District of Pennsylvania, as part of a broader national initiative targeting electric stimulation fraud.

What Did Appleton Medical Clinic Actually Do?

Appleton Medical Clinic offered outpatient pain treatment using a device called the RST Sanexas neoGEN-Series — an electric stimulation device manufactured by Nevada-based RST-Sanexas, Inc. The clinic combined Sanexas treatments with vitamin blend injections and ancillary services including epidermal nerve fiber density testing, then billed the entire package to Medicare.

The problem: those combined treatments, delivered the way the clinic administered them, were not covered by Medicare and not medically necessary.

Federal Medicare coverage rules are specific on this point. National Coverage Determination 160.7.1 explicitly states that electrical nerve stimulation treatments provided by a physician in an office, by a physical therapist, or in an outpatient clinic are excluded from Medicare coverage. Appleton Medical Clinic’s setup — a physician-run outpatient clinic offering electric stimulation — fell directly within that exclusion.

Despite that coverage prohibition, Dr. Johnson advertised these treatments as covered by and billable to Medicare. The DOJ found that the treatment protocols were designed to maximize billing revenue rather than address medical need.

Dr. Johnson’s conduct went further than just his own clinic. According to the DOJ, he also served as a major national distributor of the Sanexas device and marketed it for uses outside its FDA clearance and contrary to both National and Local Coverage Determinations — meaning he promoted the device to other clinics for applications Medicare does not cover.

What Is the False Claims Act and Why Does It Matter?

The False Claims Act is the federal government’s primary tool for pursuing fraud against government programs, including Medicare and Medicaid. It imposes civil liability on anyone who knowingly submits false or fraudulent claims for payment to the federal government.

Key features of the False Claims Act that consumers and healthcare workers should understand:

Penalties are significant. Violations can result in treble damages — meaning three times the amount of the fraudulent claims — plus civil penalties per false claim submitted. The $382,362.95 settlement in this case is based on Appleton Medical Clinic’s demonstrated ability to pay, not the full calculated damages under the law.

Whistleblowers can report fraud and share in the recovery. The False Claims Act includes a qui tam provision that allows private individuals — including clinic employees, billing staff, and former patients — to file lawsuits on behalf of the government and receive a portion of any recovery. If the Appleton Medical Clinic investigation originated from a whistleblower tip, that individual could be entitled to between 15% and 30% of the government’s recovery.

No admission of wrongdoing is required. Appleton Medical Clinic and Dr. Johnson settled without admitting that any false claims were submitted. This is standard practice in False Claims Act civil resolutions.

Who Was Harmed — and Can Patients Do Anything?

Medicare patients who received Sanexas electric stimulation treatments, vitamin injections, or epidermal nerve fiber density testing at Appleton Medical Clinic and were billed through Medicare were directly affected by this scheme — even if they didn’t pay out of pocket.

Medicare fraud harms patients in two ways. First, fraudulent billing counts against a patient’s Medicare benefits and can create erroneous records in their healthcare file. Second, widespread Medicare fraud raises costs for all beneficiaries and taxpayers.

If you were a patient at Appleton Medical Clinic, here is what you can do:

• Request an Explanation of Benefits (EOB) from Medicare for the dates you received treatment. Review what was billed and what Medicare paid.
• If you see charges for electrical muscle stimulation, vitamin injections, or nerve density testing that were billed to Medicare, contact the HHS Office of Inspector General fraud hotline at 1-800-HHS-TIPS (1-800-447-8477).
• File a complaint with the Medicare program directly at 1-800-MEDICARE (1-800-633-4227).
• Contact a licensed attorney if you believe you suffered personal harm as a result of receiving medically unnecessary treatments.

This settlement does not create a direct payment fund for patients. The $382,362.95 goes to the U.S. government — not to individual Medicare beneficiaries.

The Bigger Picture: National Crackdown on Electric Stimulation Fraud

The Appleton Medical Clinic case is not an isolated enforcement action. It is part of a coordinated national initiative targeting fraudulent billing for electric stimulation devices, led primarily by the U.S. Attorney’s Office for the Eastern District of Pennsylvania.

RST-Sanexas, Inc. — the Nevada-based manufacturer of the Sanexas device used by Appleton Medical Clinic — previously settled its own False Claims Act allegations by agreeing to pay $1.5 million to the U.S. government. That settlement covered RST and its owners and affiliates, who were accused of marketing the device for uses not covered by Medicare and helping clinics develop billing protocols designed to maximize reimbursement rather than serve patient needs.

Appleton Medical Clinic’s Dr. Johnson played a dual role in this scheme — both as a clinic operator billing Medicare for the treatments and as a major national distributor of the Sanexas device, marketing it to other medical practices across the country. The Eastern District of Wisconsin coordinated its case with the Eastern and Western Districts of Pennsylvania and the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section.

Important Dates & Timeline

Milestone	Date
Appleton Medical Clinic operated Sanexas treatments	TBD (prior to investigation)
RST-Sanexas, Inc. pays $1.5M settlement	Prior to April 2026
HHS OIG investigation of Appleton Medical Clinic	TBD
Settlement agreement reached	TBD (prior to April 17, 2026)
DOJ settlement announced	April 17, 2026
$175,000 cash payment due	Per settlement terms
$207,362.95 CMS retention	Already held — retained upon settlement

Frequently Asked Questions

Can I file a claim to get money from this settlement?

 No. This is a government enforcement action under the False Claims Act — not a class action lawsuit with a public settlement fund. The $382,362.95 goes to the U.S. Treasury and the Centers for Medicare & Medicaid Services. Individual patients cannot file claims for a share of this recovery.

Is this settlement legitimate?

 Yes. The settlement was announced by the U.S. Attorney’s Office for the Eastern District of Wisconsin on April 17, 2026, and is a civil resolution under the False Claims Act. The official DOJ press release is available at justice.gov.

Did Dr. Johnson or Appleton Medical Clinic admit they committed fraud? 

No. As part of the settlement, neither Dr. Johnson nor Appleton Medical Clinic admitted that they violated the False Claims Act or that any claims submitted to Medicare were false. Civil False Claims Act settlements routinely resolve without a formal admission of wrongdoing.

What is the Sanexas device and is it legal? 

The RST Sanexas neoGEN-Series is an FDA-cleared electric stimulation device. It is not illegal to own or use. The legal issue in this case is that the clinic billed Medicare for uses of the device that fall outside Medicare’s coverage rules — specifically, electrical nerve stimulation provided in a physician’s office is explicitly excluded from Medicare coverage under National Coverage Determination 160.7.1.

What should I do if I received Sanexas treatments at Appleton Medical Clinic? 

Review your Medicare Explanation of Benefits for those dates of service. If you see charges for electrical stimulation, vitamin injections, or nerve density testing billed to Medicare, report it to the HHS OIG hotline at 1-800-447-8477 or to Medicare directly at 1-800-633-4227. Consult a licensed attorney if you believe you were harmed by receiving medically unnecessary treatments.

Can a whistleblower get money from reporting Medicare fraud like this? 

Yes. The False Claims Act’s qui tam provision allows private individuals — including clinic employees, billing staff, or others with inside knowledge — to file a lawsuit on the government’s behalf and receive 15%–30% of any recovery. If the Appleton Medical Clinic investigation began with a whistleblower tip, that individual may be entitled to a portion of the $382,362.95 settlement. Anyone with knowledge of similar Medicare fraud can report it to the HHS OIG or consult a False Claims Act attorney.

Are other clinics that used the Sanexas device being investigated?

 Potentially. The Eastern District of Pennsylvania has led a national initiative targeting electric stimulation fraud involving the Sanexas device and similar products. RST-Sanexas, Inc. itself paid $1.5 million to settle related allegations. The Appleton Medical Clinic case represents one enforcement action within a broader pattern. Other clinics that used the device and billed Medicare for the same excluded treatments may face separate scrutiny.

What is the HHS Office of Inspector General?

 The HHS OIG is the independent watchdog of the Department of Health and Human Services. It investigates fraud, waste, and abuse in Medicare, Medicaid, and other federal health programs. The OIG provided investigative support in the Appleton Medical Clinic case. Patients and healthcare workers can report suspected fraud directly to the OIG at 1-800-HHS-TIPS.

Sources & References

• U.S. Department of Justice, Eastern District of Wisconsin — Official Press Release, April 17, 2026: justice.gov
• DOJ Eastern District of Pennsylvania — RST-Sanexas, Inc. $1.5 Million Settlement: justice.gov

Last Updated: April 20, 2026

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Legal claims and outcomes depend on specific facts and applicable law. For advice regarding a particular situation, consult a qualified attorney.