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Georgia Cracking Down on Medicare and Medicaid Fraud

$520,000 False Claims Act settlement is second this week.

The state of Georgia is cracking down on Medicare and Medicaid fraud.

If there’s any doubt on that score, just look at the two False Claims Act settlements that came out this week – a $20 million settlement with the Medical Center of Central Georgia in Macon, and a $520,000 settlement with Irwin County Hospital in Ocilla.

Mike Bothwell of the Bothwell Law Group in Atlanta, who helped settle the second case in less than 20 months, notes that heath care fraud cases can be complex, but that the law provides real rewards for whistleblowers who step up with insider information that leads to recoveries and an end to fraud schemes.

In his Irwin County Hospital case, won with the help of co‐counsel Brandon Hornsby at the Hornsby Law Group in Atlanta, the whistleblowers walked away with a $130,000 award for helping stop the fraud, and as compensation for the retaliation that followed.

Federal and State False Claims Acts allow private citizens with insider knowledge of fraud, waste, and abuse to bring an action on behalf of the governments in order to stop the fraud. If the case is won, the government can recover over three times the amount defrauded, and successful whistleblowers can receive between 15 and 30 percent of the governments’ recovery.

“It’s all about incentivizing integrity,” says Bothwell. “Chiselers are always incentivized to cheat. The False Claims Act sets things right by providing a countervailing incentive to do the right thing.”

There’s no question the False Claims Act works. Last year, the U.S. government and the states recovered well over $6 billion thanks to whistleblower‐initiated cases.

Bothwell notes that a lot of False Claims Act cases involve health care – a situation likely to continue as the Affordable Care Act kicks in.

The Macon hospital settlement involved allegation of upcoding for more expensive inpatient services when the billing should have been for less costly outpatient or observation services.

In the Irwin County Hospital case, the allegations involved kickbacks for patient referrals and for billing for improperly performed imaging services.

Bothwell notes that it looks like a real fraud‐fighting partnership is forming between Georgia Attorney General Sam Olen’s Medicaid Fraud Control Unit, the U.S. Department of Justice, and Georgia whistleblowers and their attorneys.

“We’re seeing a real public/private partnership that is bringing a real dividend for the American people. That’s exactly how the law is supposed to work.” Mike Bothwell, Whistleblower Attorney

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About the Bothwell Law Group:

Since 1996, the Bothwell Law Group has earned a national reputation for successful representation of whistleblowers in federal and state courts across the United States, and is one of only a handful of firms exclusively representing whistleblowers. Bothwell Law Group’s cases have resulted in the recovery of more than $400 million for the United States treasury and in the payment of millions of dollars in whistleblower rewards. Inquiries may be directed to Mike Bothwell at (770) 643‐1606, email Mike@WhistleblowerLaw.com.

For more information about the firm, FCA settlements and FCA experience, see

www.whistleblowerlaw.com

FINAL SETTLEMENT AGREEMENT   |   COMPLAINT

DOJ Targets Funders as Eleventh Cir. Upholds Whistleblower Win

Whistleblower Law

Below is a clip from Bloomberg Law, full article here: https://news.bloomberglaw.com/federal-contracting/doj-targets-funders-as-eleventh-cir-upholds-whistleblower-win

A $255 million Medicare fraud award will stand after the Eleventh Circuit refused Thursday to reconsider a panel’s decision greenlighting a successful whistleblower’s outside funding agreement.

The U.S. Court of Appeals for the Eleventh Circuit wasn’t swayed by the skilled nursing facility defendants’ assertion in a petition for rehearing that the False Claims Act expressly disallows third parties from receiving assigned fraud claims pursued in the U.S. government’s name.

The panel’s June 25 decision is the “first and only” by a federal court to give a whistleblower “the unlimited right to secretly reassign the government’s claims to any third-party speculator gambling with the government’s money,” the nursing facilities said in their petition challenging standing.

The panel’s decision was right because the whistleblower, who sold a 4% share in any recovery she received, still maintained sufficient control and interest in the litigation, said H. Vincent McKnight, Jr., of Sanford Heisler Sharp LLP in Washington.

Had the Eleventh Circuit agreed with the nursing facilities, whistleblowers not only wouldn’t be allowed to enter into such agreements, they also couldn’t, for example, use a line of credit with a bank to finance an FCA case, McKnight said.

U.S. Examining Outside Funded Suits

The appeals court’s decision comes at a time when the Justice Department, which has the power to stop FCA cases it doesn’t support, has voiced concerns about not knowing when third parties are funding cases it is investigating and litigating.

Stephen Cox, deputy associate for Attorney General William Barr, said early this year the agency was weighing what interest the U.S. has in funding agreements, and if it should require disclosures in some instances.

More recently, Justice attorneys have been told to engage in a “purely information-gathering exercise” to ascertain when third party funders are working with whistleblowers, and how much control they have over the cases, Ethan P. Davis, deputy assistant to the attorney general, told the Chamber of Commerce’s legal arm June 26.

Counsel for whistleblowers, however, have expressed worry over such governmental inquiries.

“The DOJ’s interest in learning whether a whistleblower has an agreement with a third party funder is cause for concern because that information could lead to DOJ using that information to dismiss otherwise meritorious cases,” said Mike Bothwell of Bothwell Law Group PC in Roswell, Ga.

“Animus” toward a limited liability company whistleblower was one reason why an Illinois federal court rejected a DOJ motion to dismiss a false claims case alleging kickbacks by drug makers last year.

The Justice Department maintained that disapproval of professional whistleblowers—the suit was one of nearly a dozen filed on behalf of the National Health Care Analysis Group—is a valid governmental reason for stopping a suit from going forward, said Judge Staci M. Yandle of the U.S. District Court for the Southern District of Illinois.

But the U.S. Court of Appeals for the Seventh Circuit reversed Yandle Aug. 17, ruling that the motion to dismiss should be granted and that it didn’t violate due process law.

An attorney who represents false claims defendants, including pharmaceutical companies, says DOJ’s inquiries could help the U.S. reasonably conclude that a case should be dismissed, or help explain why a settlement is being held up.

When the DOJ assesses fraud claims, it looks at whether whistleblowers have useful information from being insiders, or if they are just being opportunistic, said Scott D. Stein of Sidley Austin LLP in Chicago.

“Knowing who is behind a whistleblower’s suit can have a significant impact on the DOJ’s ability to settle with a defendant,” he said.

“If a whistleblower has a secret third party agreement that requires handing over a large cash payment, the whistleblower could hold up a resolution by pushing for more money, and the DOJ won’t know why,” said Stein.

 

The Bothwell Law group does not claim ownership of this article.

The full article is credited here: https://news.bloomberglaw.com/federal-contracting/doj-targets-funders-as-eleventh-cir-upholds-whistleblower-win

Universal Health Services, Inc. And Related Entities To Pay $122 Million To Settle False Claims Act

False claims act

Universal Health Services, Inc. And Related Entities To Pay $122 Million To Settle False Claims Act Allegations Relating To Medically Unnecessary Inpatient Behavioral Health Services And Illegal Kickbacks

Universal Health Services, Inc., UHS of Delaware, Inc.(together, UHS), and Turning Point Care Center, LLC (Turning Point), a UHS facility located in Moultrie, Georgia, have agreed to pay a combined total of $122 million to resolve alleged violations of the False Claims Act for billing for medically unnecessary inpatient behavioral health services, failing to provide adequate and appropriate services, and paying illegal inducements to federal healthcare beneficiaries, the Department of Justice announced today. UHS owns and provides management and administrative services to nearly 200 acute care inpatient psychiatric hospitals and residential psychiatric and behavioral treatment facilities nationwide. UHS is headquartered in King of Prussia, Pennsylvania.

As part of a comprehensive civil settlement, UHS will pay the United States and participating states a total of $117 million to resolve allegations that its hospitals and facilities knowingly submitted false claims for payment to the Medicare, Medicaid, TRICARE, Department of Veterans Affairs, and Federal Employee Health Benefit programs for inpatient behavioral health services that were not reasonable or medically necessary and/or failed to provide adequate and appropriate services for adults and children admitted to UHS facilities across the country.

In a separate civil settlement, Turning Point will pay the United States and the State of Georgia $5 million to resolve allegations that it provided free or discounted transportation services to induce Medicare and Medicaid beneficiaries to seek treatment at Turning Point’s inpatient detoxification and rehabilitation program or intensive outpatient program.

“The Department of Justice is committed to protecting patients and taxpayers by ensuring that the treatment provided to federal healthcare beneficiaries is reasonable, necessary, and free from illegal inducements,” said Acting Assistant Attorney General Ethan P. Davis for the Department of Justice’s Civil Division. “The Department will continue to be especially vigilant when vulnerable patient populations are involved, like those served by behavioral healthcare providers.”

The government alleged that, between January 2006, and December 2018, UHS’s facilities admitted federal healthcare beneficiaries who were not eligible for inpatient or residential treatment because their conditions did not require that level of care, while also failing to properly discharge appropriately admitted beneficiaries when they no longer required inpatient care. The government further alleged that UHS’s facilities billed for services not rendered, billed for improper and excessive lengths of stay, failed to provide adequate staffing, training, and/or supervision of staff, and improperly used physical and chemical restraints and seclusion. In addition, UHS’s facilities allegedly failed to develop and/or update individual assessments and treatment plans for patients, failed to provide adequate discharge planning, and failed to provide required individual and group therapy services in accordance with federal and state regulations.

Of the $117 million to be paid by UHS to resolve these claims, the federal government will receive a total of $88,124,761.27, and a total of $28,875,238.73 will be returned to individual states, which jointly fund state Medicaid programs.

“Quality mental health treatment is critical for the patients who place their trust in the hands of service providers,” said William M. McSwain, United States Attorney for the Eastern District of Pennsylvania. “The allegations involved in this matter — inappropriate billing and inadequate care – have no place in our health care system. Behavioral health service entities must have strong mechanisms in place, including appropriate supervision and oversight, to avoid fraud and abuse in order to ensure they provide the level of care that their patients deserve.”

With respect to Turning Point, the government alleged that, from January 2007 until May 1, 2019, the facility provided free or discounted transportation services to Medicare and Medicaid beneficiaries to induce them to seek detoxification and rehabilitation treatment at Turning Point’s inpatient or intensive outpatient programs.

“Illegal inducements should never play a role in a patient’s decision regarding treatment, especially when a patient is seeking care for addiction and other behavioral health needs,” said Byung J. “BJay” Pak, U.S. Attorney for the Northern District of Georgia. “Our office remains committed to pursuing unlawful arrangements that undermine the integrity of federal healthcare programs.”

The government’s settlement with UHS resolves 18 cases pending in the Eastern District of Pennsylvania, Western District of Michigan, the Eastern District of Michigan, and Northern District of Georgia under the qui tam, or whistleblower, provision of the False Claims Act, which permit private parties to file suit for false claims on behalf of the United States and to share in any recovery. The whistleblower share of the federal portion of the settlement will be $15,862,457.03. The settlement with Turning Point resolves an additional qui tam lawsuit filed in the Northern District of Georgia. The whistleblower in that suit will receive $861,853.64, from the federal share of the Turning Point settlement.

“Providing top quality health care to service members and their beneficiaries is the primary mission of the Defense Health Agency. It’s unfortunate a company tried to take advantage of a system that ensures health care for those men and women who are on the front lines every day protecting our nation,” said Lt. Gen. Ronald Place, director, DHA. “We commend the Department of Justice and its partners for bringing justice to those responsible for knowingly defrauding TRICARE beneficiaries.”

“VA OIG continues to be vigilant in holding those accountable who defraud VA programs and ensure that tax payer dollars are appropriately utilized for the care of our nation’s veterans and their dependents. Also, we thank our law enforcement partners and the United States Attorney’s Office for their support,” said Acting Special Agent in Charge Jeffrey Stachowiak, Department of Veterans Affairs, Office of Inspector General.

“The OPM OIG does not tolerate predatory behavior that risks the health and safety of vulnerable patients,” said Thomas W. South, Deputy Inspector General for Investigations for the Office of Personnel Management. “We are grateful for the fine work of our investigators and Department of Justice partners. Today’s settlement demonstrates OPM-OIG’s unwavering commitment to investigating conduct that affects vulnerable FEHBP enrollees.”

Contemporaneous with the civil settlements announced today, UHS, on behalf of its inpatient acute and residential behavioral health facilities, has entered into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services, Office of Inspector General (OIG), which will remain in effect for five years. UHS must retain an independent monitor, selected by the OIG, which will assess UHS’s Behavioral Health Division’s patient care protections and report to the OIG. In addition, an independent review organization will perform annual reviews of UHS’s inpatient behavioral health claims to federal health care programs.

“Protecting the health and safety of Medicare and Medicaid patients is one of our primary concerns. Our Corporate Integrity Agreement provides future protection for patients and federal health care programs through controls and monitoring designed to ensure that UHS’s behavioral health facilities provide quality services and medically necessary care to patients,” said Gregory E. Demske, Chief Counsel to the Inspector General for the United States Department of Health and Human Services. “This case demonstrates that the government will aggressively pursue allegations of substandard inpatient care.”

The settlement with UHS was the result of a collaborative effort among numerous federal and state agencies. The Commercial Litigation Branch of the Department of Justice’s Civil Division and the U.S. Attorney’s Office for the Eastern District of Pennsylvania handled the cases, with substantial assistance from the U.S. Attorneys’ Offices for the Middle District of Florida, the Northern District of Georgia, the Eastern District of Michigan, the Western District of Michigan, the Middle District of Georgia, the Northern District of Illinois, the Middle District of North Carolina, the Western District of North Carolina, the District of Oregon, the Middle District of Pennsylvania, the Southern District of Texas, the District of Utah, the Eastern District of Virginia, the Western District of Virginia, the Northern District of Oklahoma, and the District of Wyoming, as well as the National Association of Medicaid Fraud Control Units (NAMFCU). The Civil Division and NAMFCU coordinated the nationwide investigation of UHS in partnership with the Office of Inspector General for the Department of Health and Human Services; the Department of Defense Criminal Investigative Service; the Department of Veterans Affairs, Office of Inspector General; the Office of Personnel Management, Office of Inspector General; and the Federal Bureau of Investigation. The Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the Northern District of Georgia handled the Turning Point matter with assistance from the Office of Attorney General of Georgia and the Office of Inspector General for the U.S. Department of Health and Human Services.

The civil settlement with UHS resolved the following captioned cases: United States ex rel. Gardner v. Universal Health Services, Inc., 2:17-cv-03332-AB (E.D. Pa.); United States ex rel. Naylor v. Universal Health Services, Inc., 2:14-cv- 06198-AB (E.D. Pa.); United States ex rel. Jain v. Universal Health Services, Inc., et al., No. 2:13-cv-06499-AB (E.D. Pa.); United States ex rel. Chisholm v. Universal Health Services, Inc., et al., 2:17-cv-01892-AB (E.D. Pa.); United States ex rel. Doe, et al. v. Universal Health Services, Inc., et al., No. 2:14-cv-00921 (E.D. Pa.); United States ex rel. Pate v. Behavioral Hospital of Bellaire, et al., 2:15-cv-00554-AB (E.D. Pa.); United States ex rel. Brinson, et al. v. Universal Health Services, Inc., et al., 2:14-cv-07275-AB (E.D. Pa.); United States ex rel. Mitchell v. Turning Point Care Center, Inc., et al., 2:15-cv-00259-AB (E.D. Pa.); United States ex rel. Peterson v. Universal Health Services, Inc., et al., 2:17-cv-01897-AB (E.D. Pa.); United States ex rel. Conaway, et al. v. Universal Health Services, Inc., et al., 2:17-cv- 02233-AB (E.D. Pa.); United States ex rel. Eborall v. Universal Health Services, Inc., et al., 2:17-cv-03249-AB (E.D. Pa.); United States ex rel. Sachs, et al. v. Universal Health Services, Inc., et al., 2:17-cv-03604-AB (E.D. Pa.); United States ex rel. Klotz v. Universal Health Services, Inc., et al., 2:17-cv-05163-AB (E.D. Pa.); United States ex rel. Brockman, et al. v. Universal Health Services, Inc., et al., 2:17-cv-05350-AB (E.D. Pa.); United States ex rel. Glass v. Hughes Center, LLC., et al., 2:18-04018-AB (E.D. Pa.); United States ex rel. Parent-Leonard v. Forest View Psychiatric Hospital, et al., No. 1:18-cv-1426 (W.D. Mich.); United States ex rel. Russell, et al. v. Universal Healthcare Services, Inc., et al., No. 1:19-CV-0764 (N.D. Ga.); United States ex rel. McLauchlin, et al. v. Havenwyck Holdings, Inc., et al., No. 2:19-cv-10832 (E.D. Mich.).

The settlement with Turning Point resolved the case captioned United States ex rel. Heatley v Turning Point Care Center LLC, et al., 1:17-cv-3869-AT (N.D. Ga.).

The claims resolved by the settlements are allegations only, and there has been no determination of liability.

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Component(s):

Civil Division

Press Release Number:

20-649

Whistleblowerlaw.com & Mike Bothwell Lawfirm does not claim or imply ownership of this article. 

Hospice to pay $1.75 million to resolve false claims act allegations

The USDJ Northern District recently published the below. See a portion below: 

ATLANTA – STG Healthcare of Atlanta, Inc. (“STG Healthcare”) and two of its senior executives, Paschal “Pat” Gilley and Mathew Gilley, have agreed to pay $1.75 million to resolve allegations that STG Healthcare, operating as Interim Healthcare of Atlanta, submitted or caused the submission of false claims to Medicare and Medicaid for patients who were not eligible for the hospice benefit and that resulted from STG Healthcare’s provision of unlawful payments to a referring physician in violation of the Anti-Kickback Statutes.

“Hospice is not a blank check for unscrupulous medical providers willing to admit patients who are not terminally ill,” said U.S. Attorney Byung J. “BJay” Pak.  “It is reserved for those who truly need it.  We will also continue to prioritize cases where it appears that a medical decision, especially the decision to forego curative treatment, has been influenced by a kickback.”

“When healthcare providers put their financial interests above the needs of patients the federal funds are diverted from where they are truly needed, putting our most vulnerable citizens at risk,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “The message is clear; the FBI will not tolerate companies who file false claims to generate more corporate revenue and take advantage of programs like Medicare & Medicaid.”

“As more Americans choose hospice care, more government funding is being provided to this critical service. Unfortunately, scammers are seizing an opportunity to steal precious funding by enrolling ineligible patients in hospice care,” said Derrick Jackson, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “With our law enforcement partners, we will continue to protect patients and the programs on which they depend.”

“The hospice benefit provided by Medicaid is especially reserved for terminally ill Georgians at a critical time of transition in their care,” said Attorney General Chris Carr.  “Our office is proud to have worked alongside the U.S. Attorney’s Office for the Northern District of Georgia in this effort, and we will continue to ensure the hospice benefit is not exploited and abused by health care providers to the detriment of Georgia taxpayers.”

The Medicare and Medicaid hospice benefit is available for patients who elect palliative treatment (medical care focused on providing patients with relief from pain, symptoms, or stress) for terminal illness and who have a life expectancy of six months or less if their illness runs its normal course.  Before billing government healthcare programs, a hospice provider must comply with Medicare and Medicaid’s requirements and ensure that patients who are foregoing curative care are in need of end-of-life care.

Whistleblowerlaw.com & Mike Bothwell Lawfirm does not claim or imply ownership of this article. 

Full article link here: https://www.justice.gov/usao-ndga/pr/hospice-pay-175-million-resolve-false-claims-act-allegations

Throw Out Your Assumptions About Whistleblowing

Harvard Business Review recently published the below. See a portion below: 

Whistleblowing stories are all over the news. Some observers have attributed this to a systemic change in society. There are more stories about whistleblowing, the argument goes, because there are more crimes to report.

However, rather than an increase in criminal activity, we may instead be observing an increase in the willingness of employees to speak up. Consider the dramatic increase in claims of sexual harassment in 2017 as the #MeToo movement gained momentum. Was this a sudden increase in harassment, or an increased willingness to speak up about problems that have been ongoing for years?

Our research on employee whistleblowing, using previously unavailable data, shows for the first time that we may be in the golden age of accountability systems. In 2018, NAVEX Global, the leading provider of employee hotline and incident management systems, provided us secure, anonymized access to more than 2 million internal reports made by employees of more than 1,000 publicly traded U.S. companies.

Our study of the data led us to two important findings: First, whistleblowers are crucial to keeping firms healthy. The average manager seems to take these reports seriously and uses them to learn of and address issues early, before they evolve into larger, more costly problems. We also found that second hand reports are more credible and more valuable, on average, than firsthand reports.

Based on our research we’ve identified three lessons for leaders on effectively managing whistleblower systems.

View the 3 lessons and read full article here.

Whistleblowerlaw.com & Mike Bothwell Lawfirm does not claim or imply ownership of this article. 

Full article link here: https://hbr.org/2020/01/throw-out-your-assumptions-about-whistleblowing

Justice Department Recovers over $3 Billion from False Claims Act Cases in Fiscal Year 2019

Justice department logo

The United States Justice Department recently published the below article. See a portion below: 

The Department of Justice obtained more than $3 billion in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending Sept. 30, 2019, Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division announced today.  Recoveries since 1986, when Congress substantially strengthened the civil False Claims Act, now total more than $62 billion.

“The significant number of settlements and judgments obtained over the past year demonstrate the high priority this administration places on deterring fraud against the government and ensuring that citizens’ tax dollars are well spent,” said Assistant Attorney General Hunt.  “The continued success of the department’s False Claims Act enforcement efforts are a testament to the tireless efforts of the civil servants who investigate, litigate, and try these important cases as well as to the fortitude of whistleblowers who report fraud.”

Of the more than $3 billion in settlements and judgments recovered by the Department of Justice this past fiscal year, $2.6 billion relates to matters that involved the health care industry, including drug and medical device manufacturers, managed care providers, hospitals, pharmacies, hospice organizations, laboratories, and physicians.  This is the tenth consecutive year that the department’s civil health care fraud settlements and judgments have exceeded $2 billion.  The amounts included in the $2.6 billion reflect only federal losses, but in many of these cases the department was instrumental in recovering additional millions of dollars for state Medicaid programs.

In addition to combating health care fraud, the False Claims Act serves as the government’s primary civil tool to redress false claims for federal funds and property involving a multitude of other government operations and functions.  The Act helps to protect our military and first responders by ensuring that government contractors provide equipment that is safe, effective, and cost efficient; to protect American businesses and workers by promoting compliance with customs laws, trade agreements, visa requirements, and small business protections; and to protect other critical government programs ranging from the provision of disaster relief funds to farming subsidies.

In 1986, Congress strengthened the Act by increasing incentives for whistleblowers to file lawsuits alleging false claims on behalf of the government.  These whistleblower, or qui tam, actions comprise a significant percentage of the False Claims Act cases that are filed.  If the government prevails in a qui tam action, the whistleblower, also known as the relator, typically receives a portion of the recovery ranging between 15 and 30 percent.  Whistleblowers filed 633 qui tam suits in fiscal year 2019, and this past year the department recovered over $2.1 billion in these and earlier filed suits.

Health Care Fraud

The department investigates and resolves matters involving a wide array of health care providers, goods, and services.  The department’s health care fraud enforcement efforts not only recover money for federal health care programs, such as Medicare, Medicaid, and TRICARE, but also help deter fraud schemes that put patients at risk and increase health care costs.

Reflecting the department’s commitment to holding drug companies accountable for their role in the opioid crisis, two of the largest recoveries involving the health care industry this past year came from opioid manufacturers.  In one matter, as part of a global resolution of criminal and civil claims, Insys Therapeutics paid $195 million to settle civil allegations that it paid kickbacks to induce physicians and nurse practitioners to prescribe Subsys for their patients.  The kickbacks allegedly took the form of sham speaker events, jobs for the prescribers’ relatives and friends, and lavish meals and entertainment.  The government also alleged that Insys improperly encouraged physicians to prescribe Subsys for patients who did not have cancer, and lied to insurers about patients’ diagnoses to ensure payment by federal healthcare programs.  In another matter, Reckitt Benckiser Group plc paid a total of $1.4 billion to resolve criminal and civil liability related to the marketing of the opioid addiction treatment drug Suboxone, which is a formulation of the opioid buprenorphine.  As part of the resolution, RB Group paid $500 million to the United States to resolve civil allegations that it directly or through subsidiaries promoted Suboxone to physicians who were writing prescriptions for uses that were unsafe, ineffective, and medically unnecessary; promoted Suboxone Film using false and misleading claims that it was less susceptible to diversion, abuse, and accidental pediatric exposure than other buprenorphine products; and took steps to delay the entry of generic competition in order to improperly control pricing of Suboxone.

The department also pursued other cases involving drug manufacturers.  For example, Avanir Pharmaceuticals paid over $95 million to resolve allegations that it paid kickbacks and engaged in false and misleading marketing to induce healthcare providers in long term care facilities to prescribe the drug Neudexta for behaviors commonly associated with dementia patients, which is not an approved use of the drug.  The department also continued to investigate efforts by drug manufacturers to facilitate increases in drug prices by funding the co-payments of Medicare patients.  Congress included co-pay requirements in the Medicare program, in part, to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs.  This year, seven drug manufacturers – Actelion Pharmaceuticals US Inc., Amgen Inc., Astellas Pharma US Inc.Alexion Pharmaceuticals, Inc., Jazz Pharmacueticals Inc., Lundbeck LLC, and US Worldmeds LLC – paid a combined total of over $624 million to resolve claims that they illegally paid patient copays for their own drugs through purportedly independent foundations that the companies in fact treated as mere conduits.

The department also reported substantial recoveries involving a variety of other healthcare providers.  Pathology laboratory company Inform Diagnostics, formerly known as Miraca Life Sciences Inc., paid $63.5 million to resolve allegations that it paid kickbacks to referring physicians in the form of subsidies for electronic health records (EHR) systems and free or discounted technology consulting services.  Greenway Health LLC, an EHR software vendor, paid over $57 million to resolve allegations that it misrepresented the capabilities of its EHR product “Prime Suite” and provided unlawful remuneration to users to induce them to recommend Prime Suite to prospective new customers.  Encompass Health Corporation (formerly known as HealthSouth Corporation), the nation’s largest operator of inpatient rehabilitation facilities (IRFs), paid $48 million to resolve allegations that some of its IRFs provided inaccurate information to Medicare to maintain their status as an IRF and to earn a higher rate of reimbursement, and that some admissions to its IRFs were not medically necessary.

Recoveries in Whistleblower Suits

Of the $3 billion in settlements and judgments reported by the government in fiscal year 2019, over $2.1 billion arose from lawsuits filed under the qui tam provisions of the False Claims Act.  During the same period, the government paid out $265 million to the individuals who exposed fraud and false claims by filing these actions.

The number of lawsuits filed under the qui tam provisions of the Act has grown significantly since 1986, with 633 qui tam suits filed this past year – an average of more than 12 new cases every week.

“Whistleblowers continue to play a critical role identifying new and evolving fraud schemes that might otherwise remain undetected,” said Assistant Attorney General Hunt.  “Taxpayers have benefitted greatly from these individuals who are often required to make substantial sacrifices to bring these schemes to light.”

In 1986, Senator Charles Grassley and Representative Howard Berman led the successful efforts in Congress to amend the False Claims Act to, among other things, encourage whistleblowers to come forward with allegations of fraud.  In 2009 and 2010, further improvements were made to the False Claims Act and its whistleblower provisions.  Congress also included in the False Claims Act authority for the government to dismiss cases that do not advance the goal of fraud prevention, and during the past year the government made increasing use of this tool to help prioritize and protect the expenditure of government resources.

Finally, Assistant Attorney General Hunt expressed appreciation for the many dedicated public servants throughout the department’s Civil Division and the U.S. Attorneys’ Offices, as well as the agency Offices of Inspector General and the many other federal and state agencies that contributed to the department’s False Claims Act recoveries this past fiscal year.

“The accomplishments announced today reflect the extraordinary efforts of the men and women throughout the government committed to protecting the federal fisc and the integrity of the government’s programs,” said Assistant Attorney General Hunt.  “Having served many years in the Civil Division, I have witnessed the passion and dedication of the talented employees who have committed their careers to serving the American people and defending the interests of our great nation.”

 

Whistleblowerlaw.com & Mike Bothwell Lawfirm does not claim or imply ownership of this article. Full article link here: https://www.justice.gov/opa/pr/justice-department-recovers-over-3-billion-false-claims-act-cases-fiscal-year-2019

Judge v. Jury: $350 Million Medicare Award at Stake in Atlanta

Whistleblower attorney Mike Bothwell was a tops quoted source in the article below:

Full Article Link

The invalidation of a Florida jury’s nearly $350 million Medicare fraud verdict wasn’t only frustrating for whistleblower Angela Ruckh and her attorneys. It may have also seriously hurt plaintiffs’ ability to fight alleged fraud in the southeast U.S.

Ruckh Nov. 20 will urge the Eleventh Circuit in Atlanta to reinstate the award, which a district judge tossed after concluding she failed to satisfy U.S. Supreme Court standards for demonstrating materiality in a False Claims Act case. The federal government is supporting her appeal.

The judge misconstrued ample evidence of materiality, Ruckh says. Rejecting her appeal could do great harm to the ability of FCA whistleblowers and the federal government to raise a valid case, whistleblower attorneys say.

The decision by Judge Steven Merryday of the U.S. District Court for the Middle District of Florida “takes the most conservative and defense-oriented” view of Supreme Court standards for raising false claims cases, said Mike Bothwell of Bothwell Law Group P.C. in Roswell, Ga.

Prosecution of FCA cases will become “infinitely harder” if the U.S. Court of Appeals for the Eleventh Circuit affirms, he said.

In 2018, the U.S. recovered $2.8 billion from FCA cases, $2.5 billion of which came from cases involving the healthcare industry.

Ruckh convinced a jury in February 2017 that Medicare wouldn’t have paid Consulate Health Care, a nursing home services provider, if Medicare knew the truth about the Consulate’s practice of “ramping,” which misleads Medicare as to the necessity of services, and “upcoding” for services which led to overbilling.

Merryday tossed the verdict nine months later, ruling that the alleged misconduct wasn’t material to government payment decisions under the Supreme Court’s 2016 ruling in Universal Health Servs., Inc. v. United States ex rel. Escobar.

That is, Ruckh didn’t offer meaningful proof that Medicare’s knowledge of the disputed practices was consequential to payment decisions, Merryday concluded.

Medicare knew about the allegations and continued to pay anyway, he said.

“We don’t want every administrative failure by a contractor to be an FCA case, but when you have facts like these, where folks are receiving unnecessary services, how is that not leading to inflated, unnecessary claims,” said Pamela Coyle Brecht of Pietragallo Gordon Alfano Bosick & Raspanti LLP in Philadelphia.

“Medicare has a pay and chase system. The U.S. doesn’t examine every claim in real time. It is entitled to rely on the truthfulness of a claim submitted by a contractor, and then attempt to recoup fraudulent payments at a later date,” she said.

“It undermines the entire purpose of the FCA to say that payments to a contractor, that turn out to be fraudulent, require dismissal of cases for lack of materiality,” she said.

Consulate says materiality was indeed lacking because Ruckh offered no evidence that Medicare had overlooked any alleged deficiencies in audits before deciding to continue paying.

“If the government thought the alleged violations were material, why would they keep paying the claims? There are a host of cases now where the government ‘knowledge’ defense has been successfully raised,” said Aaron Danzig of Arnall Golden Gregory LLP in Atlanta.

‘Wild, Wild West’

The verdict should be reinstated because Ruckh introduced more than enough evidence to show that higher therapy levels lead to increased payments, and using false therapy codes has a natural tendency to influence payments, her brief says.

The U.S. Justice Department supports Ruckh, stating in a brief that materiality for her claims is “obvious,” and that “it is difficult to see how any reasonable jury could have concluded otherwise.”

Brecht said it’s “currently the wild, wild west with regard to the materiality defense, and I would hope that the Supreme Court would shed more light on this issue.”

“There are many reasons why the government would continue to pay a contractor that don’t have to do with excusing fraud,” Brecht said.

More litigation will result if the Eleventh Circuit affirms, “because whistleblowers will be forced to get more aggressive in discovery,” Brecht said. “They will be forced to say I need to know more about what the government knew about defendants’ practices and when it knew it.”

Defendants naturally will be pleased if Merryday’s ruling is affirmed.

But in the event the Eleventh Circuit sides with Ruckh, the silver lining for defendants could come in the form of another materiality case working its way back to the high court’s door.

Several defendants since Escobar have unsuccessfully petitioned the Supreme Court to adopt a clear “no harm, no foul” rule with regard to continued payments. There can’t be any fraud if the government knows but pays, the petitions have argued.

Merryday’s opinion cited one of those continued payment cases, United States ex rel. Harman v. Trinity Indus. Inc.

The Fifth Circuit ruled in that case that a $663 million jury verdict couldn’t stand because the Federal Highway Administration always paid for and approved of a highway guardrail contractor’s product despite knowledge of alleged wrongdoing.

To contact the reporter on this story: Daniel Seiden in Washington at dseiden@bloomberglaw.com

To contact the editors responsible for this story: Jo-el J. Meyer at jmeyer@bloomberglaw.com; Patrick L. Gregory at pgregory@bloomberglaw.com

Whistleblowerlaw.com & Mike Bothwell Lawfirm does not claim or imply ownership of this article. Full article link here: https://news.bloomberglaw.com/federal-contracting/judge-v-jury-350-million-medicare-award-at-stake-in-atlanta

Trump & our thoughts on why we should protect Whistleblowers

USA Today recently published the following article “Trump’s allies want to ID the whistleblower, who may learn the price of speaking out“.

Here are our my thoughts.

Shortly after signing the Declaration of Independence, the Continental Congress passed a resolution for whistleblower protection.  Some sailor and marines blew the whistle on a commander of the navy during the war with Great Britain.  They reported the problems to the Continental Congress and were prosecuted for it.  The Continental Congress not only passed the resolution supporting blowing the whistle on such abuse (calling it a “duty”), but it passed a subsequent resolution to pay the costs of their defense.

Another major whistleblower legislation was passed in 1863 during the Civil War.  The False Claims Act also known as the Lincoln Law allowed private citizens to sue on behalf of the government to recover for false claims and fraud against the government.  This law was significantly revised in 1985 and has become the government’s number one tool for prosecuting fraud against the United States.  Whistleblowers recover from 15% to 30% of what the government receives and cases under the False Claims Act have brought in $60 billion since it was revamped in 1985.

Various state and federal agencies have passed whistleblower protections and evinced a consensus that whistleblowers play a crucial role in ferreting out fraud, waste, and abuse in our system.  In 1985, when Congress was considering one of the oldest and most robust whistleblower statutes (the False Claims Act), it noted that the act was underutilized in large part because of fear of retaliation.  That is perhaps the number one deterrent to people shinning a light on corruption and illicit dealings.  From July 30, 1778 to the present, America has agreed to protect people who are willing to bring bad things to light.

We absolutely need to continue this protection. I’m fighting for this daily.

Beaumont To Pay $84.5 Million To Settle False Claims Act In Federal Whistleblower Case

Bothwell Law Group filed a case that aided whistleblowers in the reporting of fraudulent activity by William Beaumont Hospital in Detroit, Michigan. The hospital agreed to pay an $84.5 million settlement to resolve allegations under the False Claims Act of improper relationships with eight referring physicians that led to the submission of false claims to the Medicare, Medicaid and the military Tricare programs.

Federal Whistleblower Attorney

If you have witnessed misuse, fraud or waste of government funds and feel compelled to do something about it, contact us at Bothwell Law Group at 770-643-1606.

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