qui tam lawsuit

Prime Healthcare Sued Under False Claims Act

Submitted by kludowitz on January 31, 2014
January 31, 2014
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Prime Healthcare Services Inc. (PHS) is being sued by an employee whistleblower, Karin Berntsen, for allegations under the False Claims Act that they knowingly falsified patients’ admission information, Law360 announced earlier this month.

PHS allegedly directed hospital staff to falsify patients’ diagnoses in order to charge the highest amount to Medicare and Medicaid. PHS also refused to release patients to post-acute care centers so they could further their profits. It is further alleged that PHS bought failing hospitals and enhanced their revenue by having those hospitals engage in similar fraudulent practices. PHS allegedly cost Medicare and Medicaid around $50 million in reimbursements.

The lawsuit was originally filed by Karin Berntsen, a former PHS employee, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. The government has elected not to intervene in this case, and Berntsen could receive up to 30 percent of the settlement, if there is one.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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St. Joseph to Settle False Medicare Claims for $16.5M; Whistleblowers to Receive $2.5M

Submitted by kludowitz on January 29, 2014
January 29, 2014
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Saint Joseph Health System, Inc. has agreed to pay the U.S. Government $16.5 million to resolve allegations under the False Claims Act that they submitted false or fraudulent claims to the Medicare and Kentucky Medicaid programs for a variety of medically unnecessary heart procedures, the Justice Department announced today.

Several doctors working at the Saint Joseph London Hospital allegedly performed numerous invasive cardiac procedures on Medicare and Medicaid patients who did not need them. The hospital then billed the federal programs for these unnecessary procedures, which include coronary stents, pacemakers, coronary artery bypass graft surgeries (“CABGS”), and diagnostic catheterizations. Medicare and Medicaid programs only reimburse health care providers for operations that are deemed medically necessary. Hospitals generally receive between $10,000 and $15,000 for medical procedures such as heart stents.

The settlement also resolves allegations that Saint Joseph violated the federal Stark Law and Anti-Kickback Statute by entering into management agreements with doctors at the Cumberland Clinic. These agreements served as an inducement for the doctors to refer patients to Saint Joseph. The government contends that Medicare and Medicaid are not responsible for claims that resulted from this improper financial relationship between the doctors and the hospital.

Saint Joseph has also agreed to enter into a Corporate Integrity Agreement with the Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), which obligates the hospital to undertake substantial internal compliance reforms and commit to a third-party review of its claims to federal health care programs for the next five years.

The lawsuit was originally filed by Doctors Michael Jones, Paula Hollingsworth, and Michael Rukavina, three Lexington cardiologists, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. The three whistleblowers will receive $2,458,810 as their portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Clinics to Settle False Medicare Claims for $1.8M; Whistleblower to Get $324K

Submitted by kludowitz on January 27, 2014
January 27, 2014
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Two orthopedic clinics, Tennessee Orthopaedic Clinics P.C. and Appalachian Orthopaedic Clinics P.C., will pay a combined $1.85 million to resolve allegations under the False Claims Act that they knowingly billed state and federal health care programs for re-imported osteoarthritis medications, known as viscosupplements, the Department of Justice announced last week. 

Viscosupplements are injections approved by the Food and Drug Administration for the treatment of osteoarthritis pain in the knee. Viscosupplements are reimbursed by Medicare, Medicaid and other federal health care programs at a set rate based on the average sales price of the domestic product. The government alleged that the clinics knowingly purchased deeply discounted viscosupplements that were re-imported from foreign countries and billed them to state and federal health care programs at the set rate in order to profit from the reimbursement system, when such reimported viscosupplements were not reimbursable by those programs. Allegedly, the re-imported product included labeling in foreign languages and in English for additional uses not approved in the United States, demonstrating that the product was re-imported.  Moreover, because the product was re-imported, the government alleged there was no manufacturer assurance that it had not been tampered with or that it was stored appropriately. 

Tennessee Orthopaedic Clinics P.C. will pay $1.3 million, and Appalachian Orthopaedic Clinics P.C. will pay $550,000. 

The lawsuit was originally filed by Douglas Estey, a physician’s assistant paid to speak to medical providers about the use of viscosupplements, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. Estey will receive $323,750 as his portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Government Intervenes in KBR False Claims Lawsuit

Submitted by kludowitz on January 24, 2014
January 24, 2014
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The government has filed a complaint against Kellogg, Brown & Root Services Inc. (KBR) and Kuwaiti companies La Nouvelle General Trading & Contracting Co. (La Nouvelle) and First Kuwaiti Trading Co. (First Kuwaiti) for submitting false claims in connection with KBR’s contract with the Army to provide logistical support in Iraq, the Department of Justice announced yesterday. 

Allegedly, KBR knowingly made false claims to the government for a contract with the Army to provide wartime logistical support, known as the Logistics Civil Augmentation Program (LOGCAP) III. The award of LOGCAP III paved the way for the company to become a critical source for logistical support services in Iraq, which included transportation, maintenance, food, shelter, and facilities management. KBR performed many of these services through subcontracts awarded to foreign companies local to the region, such as La Nouvelle and First Kuwaiti. 

The government alleged that, KBR employees took kickbacks from La Nouvelle and First Kuwaiti in connection with the award and oversight of subcontracts awarded to these companies. KBR then claimed reimbursement from the government for costs it incurred under the subcontracts that allegedly were inflated, excessive, or for goods and services that were grossly deficient or not provided. La Nouvelle later rewarded the KBR employee who awarded the subcontract with a $1 million bank draft.  KBR billed the government for the costs of both of these subcontracts.  The lawsuit also alleges that KBR used refrigerated trailers to transport ice for consumption by the troops that had previously been used as temporary morgues without first sanitizing them.

The government is suing KBR, La Nouvelle and First Kuwaiti under the False Claims Act, as well as the Anti-Kickback Act.

The lawsuit was originally filed by Bud Conyers, a former KBR/Halliburton truck driver, under the whistleblower provision of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. The False Claims Act also permits the government to investigate the allegations made in the whistleblower’s complaint and decide whether to intervene in the lawsuit, which it has elected to do in this case.

 The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who uncover fraud of every kind perpetrated against our government including, health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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Hitachi Nuclear Energy to Settle False Claims for $2.7M

Submitted by kludowitz on January 23, 2014
January 23, 2014
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General Electric Hitachi Nuclear Energy Americas LLC (GE Hitachi) has agreed to pay $2.7 million to resolve allegations under the False Claims Act that it made false statements and claims to the Department of Energy (DOE) and the Nuclear Regulatory Commission (NRC) concerning an advanced nuclear reactor design, the Department of Justice announced today.

GE Hitachi allegedly made false statements to the NRC and the DOE about a component of the advanced nuclear Economic Simplified Boiling-Water Reactor (ESBWR) known as the steam dryer. A steam dryer removes liquid water droplets from steam produced by the nuclear reaction that generates electricity in boiling-water type reactors. The NRC requires that applicants for nuclear reactor design certification demonstrate that vibrations caused by the steam dryer will not result in damage to a nuclear plant. The government alleged that GE Hitachi concealed known flaws in its steam dryer analysis and falsely represented that it had properly analyzed the steam dryer in accordance with applicable standards and had verified the accuracy of its modeling using reliable data.     

GE Hitachi received funding from the DOE to cover up to half of the cost of developing, engineering and obtaining design certification for the advanced nuclear ESBWR. The NRC, which regulates the civilian use of nuclear power, is responsible for determining whether to approve GE Hitachi’s application for the reactor design certification. The NRC is still reviewing the application and has not reached a final decision on the certification. 

The lawsuit was originally filed by LeRay Dandy, a former GE Hitachi employee, under the whistleblower provisions of the False Claims Act. The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. Dandy’s share of the settlement has yet not been determined.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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RehabCare to Settle False Medicare Claims for $30M; Whistleblower to Get $700K

Submitted by kludowitz on January 21, 2014
January 21, 2014
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RehabCare Group Inc. has agreed to pay $30 million to resolve allegations that they violated the False Claims Act by engaging in a kickback scheme related to the referral of nursing home businesses, the Justice Department announced last week.  

RehabCare allegedly arranged to obtain Rehab Systems of Missouri’s contracts to provide therapy to patients residing in 60 nursing homes controlled by Rehab Systems majority-owner James Lincoln. In exchange for this stream of referrals, RehabCare allegedly paid Rehab Systems a $400,000 to $600,000 upfront payment and allowed Rehab Systems to retain a percentage of the revenue generated by each referral.  

Additionally, as part of this settlement, the entities have agreed to restructure their business arrangement.

The lawsuit was originally filed by a competing therapy provider under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. The unnamed whistleblower will receive a total of $ $700,000 as their portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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BioScrip to Settle False Health Care Claims for $15M

Submitted by kludowitz on January 17, 2014
January 17, 2014
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BioScrip has agreed to pay $15 million to resolve allegations under the False Claims Act that they received kickbacks from Novartis in exchange for recommending refills to patients, the Department of Justice announced earlier this week.

Novartis allegedly provided kickbacks to BioScrip, in the form of patient referrals and in the guise of rebates, in exchange for BioScrip recommending refills to its Exjade patients. This Exjade scheme violated the federal anti-kickback statute, which prohibits the offer or payment of remuneration to induce the purchase or recommendation of any drug or service covered by Medicare, Medicaid, or another federal healthcare program.

Novartis markets and manufactures Exjade, an iron chelation drug approved for use by patients who have iron overload resulting from blood transfusions. BioScrip was part of a Novartis created distribution network for Exjade, and through this network, Novartis was able to refer Exjade patients to particular pharmacies within the network. In order to obtain greater numbers of patient referrals and rebates, BioScrip, in coordination with Novartis, implemented a program of calling patients to recommend Exjade refills or to get patients who stopped ordering Exjade refills to resume their orders.

Novartis and BioScrip promoted these calls as part of an effort to offer clinical “counseling” or “education” to Exjade patients while emphasizing the importance of getting refills, but allegedly ignored Exjade’s serious, potentially life-threatening side effects, such as kidney failure and gastrointestinal hemorrhaging.

BioScrip has agreed to pay $11,685,705.43 to the United States, admit numerous facts concerning its relationship with Novartis, and agrees to cooperate with the United States in the prosecution of the claims against Novartis. BioScrip has also agreed to pay $3.31 million to a group of States to settle the States’ claims based on the same alleged conduct.

The lawsuit was originally filed by Oswald Bilotta, a former Novartis sales representative, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. Bilotta’s portion of the settlement has not yet been determined.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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NYC to Settle False Medicaid Claims for $1.4M; Whistleblower to Get $206K

Submitted by kludowitz on January 16, 2014
January 16, 2014
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New York City (NYC) has agreed to pay $1.37 million to resolve allegations that the city’s Department of Education (DOE) violated the False Claims Act by submitting false claims to Medicaid, the Department of Justice announced earlier this week.

Medicaid pays DOE a flat fee of $223 for each student to whom DOE provides at least two psychological counseling sessions in a calendar month. Half of that money comes from the federal government. DOE is not entitled to any payment if an individual student receives fewer than two counseling sessions in a month. The United States alleged that the DOE knowingly billed Medicaid for counseling services to individual students, even though it provided fewer than two counseling sessions per month to those students.

The lawsuit was originally filed by Dana Ohlmeyer, a DOE social worker, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. Ohlmeyer will receive a total of $206,250 as her portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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HealthEssentials to Settle False Medicare Claims for $1M; Whistleblowers to Get $153K

Submitted by kludowitz on January 10, 2014
January 10, 2014
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Michael R. Barr, former chief executive officer for HealthEssentials Solutions Inc., has agreed to pay $1 million to resolve allegations that he violated the False Claims Act by causing HealthEssentials to submit false claims to Medicare, the Justice Department announced today.

The government alleged that HealthEssentials billed for services that were inflated or not medically necessary and that Barr pressured HealthEssentials employees to inflate the company’s billings, despite having been advised by attorneys and others that doing so would be improper. The government further alleged that Barr pressured HealthEssentials employees to conduct special medical assessments on patients, without regard to whether the patients required the assessments, solely to increase the amount that HealthEssentials could bill for the visits. 

As part of the settlement, Barr has agreed to a three-year period of exclusion from participating in federally funded health care programs. Norman J. Pfaadt, HealthEssentials’ former chief financial officer, also agreed to pay $20,000 to resolve similar allegations.

The lawsuit was originally filed by Michael and Leigh RoBards, former HealthEssentials employees, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Michael and Leigh RoBards will receive a total of $153,000 as their portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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CareFusion to Settle False Healthcare Claims for $40M; Whistleblower to Get $3.3M

Submitted by kludowitz on January 9, 2014
January 9, 2014
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CareFusion Corp. has agreed to pay $40.1 million to settle allegations that it violated the False Claims Act by paying kickbacks and promoting its products for uses that were not approved by the Food and Drug Administration (FDA), the Justice Department announced today. 

CareFusion, a medical technology company which develops, manufactures, and sells pharmaceutical products (including products sold under the trade name ChloraPrep), allegedly paid $11.6 million in kickbacks to Dr. Charles Denham while Denham served as the co-chair of the Safe Practices Committee at the National Quality Forum, a non-profit organization that reviews, endorses, and recommends standardized health care performance measures and practices. The government contends that the purpose of those payments was to induce Denham to recommend, promote, and arrange for the purchase of ChloraPrep by health care providers. 

This settlement also resolves allegations that CareFusion knowingly promoted the sale of ChloraPrep for uses that were not approved by the FDA, some of which were not medically accepted indications, and made unsubstantiated representations about the appropriate uses of ChloraPrep.

The lawsuit was originally filed by Dr. Cynthia Kirk, a former vice president of regulatory affairs for the Infection Prevention Business Unit of CareFusion, under the whistleblower provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Kirk will receive $3.26 million as her portion of the settlement.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.

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