How Common Are Whistleblower Medicare Fraud Cases

You might have heard about a few Medicare fraud cases here and there, but you probably don’t realize how big the problem is. Did you know Medicare and Medicaid fraud costs taxpayers billions of dollars every single year? Or, that an estimated 10% of Medicare and Medicaid claims filed are fraudulent? It’s true. And in the current economic climate, our government hardly has billions to spare.

This is what makes whistleblowing so powerful, and why the government continues to offer rich payouts to individuals who file qui tam lawsuits. As the primary remedy for fraud and false claims, they offer as much as 30% of the amount recovered to the party who filed suit. As you’ll see below, this can end up being quite lucrative under the right circumstance.

History: Medicare Fraud Cases in 2013

At the time, 2013 was a banner year for fraud recoveries. Efforts netted over $3 billion for the federal government, of which over 85% was related to health care fraud. These cases netted significant dollars for the state as well: $443 million went directly back to Medicaid as a result of these recoveries.

Most of the fraud pertained to drugs and medical devices covered under federally insured health programs specifically focused on the improper promotion of drugs for uses not tested and approved by the FDA. Abbot Laboratories, Inc. paid $1.5 billion to resolve allegations against a dementia drug, with $800 million being comprised of federal and state civil recoveries.

History: Medicare Fraud Cases in 2014

In 2014, over seven hundred whistleblower lawsuits were filed on behalf of the government. This was also the first year in which recoveries exceeded $5 billion (it was $5.69 billion, to be exact). Of this amount, $2.3 billion was related to federal health programs like Medicare and Medicaid; the fifth straight year the department netted more than $2 billion in this arena.

Johnson & Johnson, along with its subsidiaries, paid $1.1 billion to settle claims of off-label prescription marketing. Omnicare came in a distant second, paying $116 million to resolve allegations of an illegal kickback scheme.

History: Medicare Fraud Cases in 2015

While much less than 2014, the Justice Department still clocked a cool $3.5 billion as a result of judgments in civil cases pertaining to false claims. This was also the fourth year in a row that Justice beat the $3 billion mark. Since the tightening of legislation back in 2009, a grand total of $26.4 billion has been recovered under the False Claims Act.

Nearly two-thirds of the recovered monies in 2015 were a result of claims related to federal health care fraud. There were a few large settlements, but nothing as large as previous years:

DaVita paid $450 million to settle claims it generated unnecessary waste and billed the government for costs that could have been avoided.
DaVita also spent $350 million to settle claims it paid kickbacks to physicians in exchange for positive clinic referrals.
500 different hospitals settled for $330 million after allegedly implanting cardiac devices in Medicare patients, contrary to the established rules and regulations.