False Claims Act Whistleblower-Physicians Throughout History
Last year, Medicaid and Medicare combined distributed over $2 trillion yearly to fund healthcare services, and that amount increases with each passing year. It is estimated that up to $100 billion of that amount is lost to fraud each year. It is no surprise then that healthcare fraud whistleblower cases involving Medicare and Medicaid make up the bulk of modern False Claims Act whistleblower lawsuits brought under the False Claims Act.
Physicians are uniquely situated to recognize when Medicare and Medicaid fraud is being committed by their employer and colleagues. A physician’s credibility, medical expertise, and insight into their employer’s operations can make them excellent physician whistleblower advocates and effective False Claims Act whistleblowers. These whistleblower-physicians are often motivated by a strong sense of duty, especially when fraud leads to patient harm. Many of these cases have become famous whistleblower cases and stand alongside other notable whistleblowers in history.
Below are three whistleblower-physicians throughout the modern FCA’s history who went above and beyond to protect their patients and ensure limited government resources are not wasted on fraudulent claims.
Dr. Paul Michelson (1986)
Dr. Michelson, an ophthalmologist of impressive pedigree, was the very first “modern” physician whistleblower following Congress’ strengthening of the False Claims Act in the 1980s. Previously affiliated with Harvard Medical School, Dr. Michelson departed the chilly northeast to join a prestigious medical group in sunny California: Scripps Clinic and Research Foundation.
There, he says he discovered a colleague falsely billing for procedures as well as performing medically unnecessary, and sometimes dangerous, laser eye surgeries on mostly elderly patients. Dr. Michelson first tried to stop the behavior internally but was ultimately fired. Dr. Michelson then filed a qui tam lawsuit in 1986, becoming one of the earliest qui tam whistleblower cases after the False Claims Act amendments, and the case was quickly intervened by the DOJ. Only a few years later, the case settled for a combined $605,000 (worth $1.7 million today). The offending physician also agreed to 400 hours of community service as part of the settlement.
As False Claims Act whistleblowers, Dr. Michelson wasn’t in it for the money; he donated his entire whistleblower award to charity, including to organizations focused on vision research and medical ethics.
Dr. Michael Drakeford (2005)
Dr. Drakeford was a practicing surgeon in rural North Carolina when Tuomey Healthcare System offered him a part-time employment contract that included generous compensation in exchange for letting Tuomey bill for his outpatient procedures. Tuomey had entered similar contracts with over a dozen other surgeons.
Dr. Drakeford, however, refused to sign the contract, reasoning the compensation offered was above fair market value and thus violated the Stark Law. Dr. Drakeford then filed a qui tam lawsuit against Tuomey in 2005 alleging they had violated the Stark Law and thus the False Claims Act. The DOJ intervened and ultimately settled the case for $72 million.
Dr. Drakeford received 25% of the settlement amount, the highest possible in an intervened case, for a total whistleblower award of $18 million. His case remains one of the notable famous whistleblower cases involving healthcare fraud.
Drs. Paula Hollingsworth, Michael Jones, and Michael Rukavina (2011)
Cardiologists Paula Hollingsworth, Michael Jones, and Michael Rukavina banded together to file a qui tam action against Saint Joseph Health System in Kentucky alleging they offered kickbacks to cardiologists and billed for medically unnecessary (and dangerously invasive) cardiac procedures.
The DOJ intervened, and Saint Joseph later settled for $16.5 million, with the three whistleblower-physicians receiving a combined $2.4 million whistleblower award. Saint Joseph agreed to special government oversight measures as part of the settlement as well as an overhaul of their compliance systems. The egregiousness of the allegations even led to a criminal investigation. This case is also among the better-known Medicare whistleblower cases.
Speak with an Experienced False Claims Act Whistleblower Attorney
Whether you are a physician, nurse, billing expert, or medical assistant, the McCabe Law Firm is here to listen to any compliance concerns you may have regarding your employer or colleagues. If you believe you have witnessed fraud against a state or federal healthcare program, you may have grounds to become a False Claims Act whistleblower.
Our attorneys have experience helping healthcare fraud whistleblower clients understand their legal options under the False Claims Act. If you believe you have information about potential fraud and are thinking of taking the stand as a healthcare fraud whistleblower, please contact us to schedule a free intake call.
