The Neuromonitoring Associates lawsuit filed by Health Care Service Corporation in February 2026 accuses the Texas-based intraoperative neuromonitoring provider of running a kickback scheme with surgeons and then abusing the No Surprises Act’s federal arbitration process to collect tens of millions of dollars in inflated payments. HCSC brought the case under the Racketeer Influenced and Corrupt Organizations Act in the U.S. District Court for the Eastern District of Texas. The complaint is partially sealed, discovery is stayed, and a motion to dismiss is pending.1CourtListener. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.
What HCSC Alleges
The complaint targets three related entities: Neuromonitoring Associates LLC (doing business as Overwatch Neuro), Physician Oversight LLC, and Monitoring Associates LLC. NMA, headquartered in McKinney, Texas, provides monitoring services to hospitals and surgery centers during spinal and other complex operations.2Georgetown Law Litigation Tracker. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.
HCSC describes two overlapping wrongs. First, the insurer alleges the defendants paid surgeons kickbacks to order intraoperative neuromonitoring during procedures. Second, HCSC says the defendants flooded the No Surprises Act’s independent dispute resolution system with claims that were not eligible for arbitration in the first place, and used the resulting awards to collect payments the insurer would not otherwise owe.2Georgetown Law Litigation Tracker. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.
The No Surprises Act, effective in 2022, set up a federal arbitration path for billing disputes between out-of-network providers and insurers. Either side can submit a payment dispute to an independent arbitrator. HCSC claims the defendants used that channel for thousands of ineligible claims, producing arbitration awards collectively worth tens of millions of dollars.2Georgetown Law Litigation Tracker. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.
Claims and Relief Sought
HCSC brings claims under the RICO Act along with fraud, negligent misrepresentation, unjust enrichment, and violations of the No Surprises Act. The insurer asks for damages, restitution, an order vacating the arbitration awards the defendants obtained, a declaration that the conduct was unlawful, and an injunction against continuing the alleged practices.1CourtListener. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.
Where the Case Stands
The case is docketed as No. 5:26-cv-00022, filed February 18, 2026, in the Eastern District of Texas in Texarkana. District Judge Robert W. Schroeder III is presiding, with Magistrate Judge James Boone Baxter handling pretrial matters.1CourtListener. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.
The defendants filed an initial motion to dismiss in April 2026. After HCSC filed a First Amended Complaint on May 26, 2026, the court denied that motion as moot. A new motion to dismiss followed on June 18, 2026, with a hearing set for August 11, 2026. The court has stayed discovery while the motion is pending, and portions of the complaint remain sealed following orders in March and May 2026.1CourtListener. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.2Georgetown Law Litigation Tracker. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.
Despite the early stage, the court has already set a jury trial for November 13, 2028. HCSC estimates trial would run ten days. The parties have also filed a joint notice regarding mediation.3Georgetown Law Litigation Tracker. Scheduling Order
NMA’s Prior Legal Troubles
NuVasive Settlement and Follow-On Enforcement
NMA has been a federal-court defendant before. In June 2018, NuVasive Clinical Services sued NMA and several individuals, including CEO Nick Luekenga, in the Northern District of Illinois. NuVasive alleged NMA stole customers through bribery and kickbacks to doctors. The parties settled in March 2019, with NMA agreeing to pay $100,000 in installments and to comply with confidentiality and no-hire provisions.4Justia. NuVasive Clinical Services v. Neuromonitoring Associates
NuVasive returned in 2020, arguing NMA had breached the settlement. Magistrate Judge Sidney Schenkier largely agreed. The court found that NMA had made late payments, breached confidentiality by circulating an internal message that falsely suggested no financial settlement existed, and circumvented the no-hire provision by engaging former NuVasive employees through a temporary staffing agency. The court stripped the settlement’s confidentiality clause, barred NMA from using those employees for a specified period, and awarded NuVasive its attorneys’ fees. The court rejected NuVasive’s separate allegation that NMA was improperly compensating physicians for referrals, finding the evidence on that particular claim insufficient.4Justia. NuVasive Clinical Services v. Neuromonitoring Associates
FLSA Overtime Collective Action
In November 2025, a collective action was filed against NMA in the District of Nevada. Chua v. Neuromonitoring Associates, LLC (No. 2:25-cv-02266) alleges that NMA failed to pay overtime to salaried neurotechnologists who worked more than 40 hours per week, in violation of the Fair Labor Standards Act. The suit seeks unpaid overtime and double damages for salaried neurotechnologists who worked for NMA anywhere in the United States during the preceding three years. No updates had been reported as of mid-2026.5NKA. Neuromonitoring Associates LLC
Federal Scrutiny of IONM Kickbacks
The HCSC allegations arrive against a backdrop of federal attention to how intraoperative neuromonitoring services are ordered and billed. In August 2023, the HHS Office of Inspector General issued Advisory Opinion 23-05, its first significant guidance on IONM arrangements in a decade. The OIG warned that joint ventures in which surgeons hold ownership stakes in IONM entities and then refer their own patients can violate the federal Anti-Kickback Statute. Such arrangements, the OIG said, generally lack safe-harbor protection and present risks of patient steering, unfair competition, and increased costs to federal healthcare programs.6American Bar Association. Risks IONM
Enforcement followed. In December 2024, the U.S. Attorney’s Office for the District of Colorado announced a $2 million settlement resolving False Claims Act allegations against Assure Holdings Corp., its subsidiary Assure Neuromonitoring LLC, founder Preston Parsons, neurosurgeon Dr. Brent Kimball, and California businessman James Mathew McAlpin. The government alleged Assure paid surgeons through joint venture companies to induce them to order neuromonitoring services, with resulting claims submitted to Medicare Advantage and Colorado Medicaid. Dr. Kimball individually agreed to pay $650,000. The alleged scheme ran through a shell company, Englewood Professional Reading LLC, formed by McAlpin at Kimball’s request, which entered a joint venture with Parsons and routed payments back to the surgeon. The case originated from an anonymous qui tam whistleblower, who received 18 percent of the settlement.7The Federal News Wire. Denver Neuromonitoring Company Settles Kickback Allegations for Over $2 Million8HHS Office of Inspector General. $2 Million Resolves Kickback Allegations Relating to Denver Neuromonitoring Company
Assure is a separate company from NMA. The alleged mechanics, though, closely track what HCSC accuses NMA of doing: paying surgeons through joint ventures to secure neuromonitoring referrals.
A Wave of Insurer Suits Over IDR Abuse
HCSC’s suit is also one of many recent insurer cases attacking how providers and billing intermediaries use the No Surprises Act arbitration channel. Anthem Blue Cross has sued HaloMD, a billing intermediary, in at least four federal districts, alleging that 55 percent of HaloMD’s IDR submissions were ineligible and that the company knowingly misrepresented claims to the arbitration system. UnitedHealthcare filed suits in January 2026 against IAS Arizona and Concord Company of Tennessee, and Anthem sued SCP Health in November 2025 over more than 27,000 allegedly ineligible disputes. In each case, insurers seek to vacate arbitration awards and recover damages under theories that parallel HCSC’s claims against NMA.9Georgetown University Center on Health Insurance Reforms. The No Surprises Act IDR Process: An Early Look at 2025 Data
The NMA case sits at the intersection of both trends: the kickback theories that have drawn DOJ and OIG attention to IONM joint ventures, and the arbitration-abuse theories driving a surge of private insurer litigation. With discovery stayed and the second motion to dismiss awaiting a ruling, the next milestone for the case is the August 2026 hearing, with trial scheduled for late 2028.1CourtListener. Health Care Service Corporation v. Neuromonitoring Associates LLC et al.