qui tam

CRC Health Corp. has agreed to pay $9.25 million to settle allegations that the company knowingly submitted or caused the submission of false claims to Medicaid and Tennessee Medicaid, the U.S. Department of Justice announced last week.  CRC is a nationwide provider of substance abuse and mental health treatment services.

CRC owns and operates a residential substance abuse treatment facility in Burns, Tenn., called New Life Lodge.  The government alleged that New Life Lodge billed the Tennessee Medicaid program (TennCare) for substance abuse therapy services that were not provided or were provided by therapists who were not properly licensed by the state of Tennessee.  The government also alleged that New Life Lodge failed to make a licensed psychiatrist available to patients at the facility, as required by the state’s regulations; failed to maintain patient-staffing ratios required by Tennessee Department of Mental Health regulations and billed for Medicaid patients in excess of the state-licensed bed capacity at the facility.  In addition, the government alleged that New Life Lodge double-billed Medicaid for prescription substance abuse medications given to residents at the facility.  New Life Lodge currently is not treating Medicaid patients at its facility.

The allegations were originally raised in a lawsuit filed by Angie Cederoth, a former New Life Lodge employee, under the whistleblower provisions of the False Claims Act.  The Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Cederoth will receive $1.5 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.

The federal government has intervened in a False Claims Act lawsuit against Orbit Medical Inc. and its former Vice President Jake Kilgore, alleging that Orbit Medical’s sales representatives boosted power wheelchair and accessory sales by altering and forging physician prescriptions and supporting documentation, the Justice Department announced earlier this week.

Medicare pays for power wheelchairs for beneficiaries who cannot perform mobility- related activities of daily living in their home using other mobility assistance equipment, such as a cane, walker or power scooter. To qualify for reimbursement, a physician must conduct a face-to-face examination of the beneficiary and provide the supplier with a written prescription for a power wheelchair within 45 days of such an encounter, along with documentation that supports the medical necessity of the device. The prescription must be completed by the physician who performed the exam and must include the beneficiary’s name, the exam date, the diagnoses and conditions the wheelchair is expected to accommodate, the length of need, and the physician’s signature.  

The lawsuit alleges that Orbit Medical sales representatives, at Kilgore’s direction and encouragement, knowingly altered physician prescriptions and supporting documentation to get Orbit Medical’s power wheelchair and accessory claims paid by Medicare, the Federal Employees Health Benefits Plan, and the Defense Health Agency. In particular, the lawsuit alleges that Orbit Medical sales representatives created documents to falsely establish that physicians examined beneficiaries in person; changed physicians’ prescriptions to falsely establish medical necessity for the power wheelchair or accessory; created or altered chart notes and other documents to falsely establish the medical necessity of the power wheelchair or accessory; forged physicians’ signatures on prescriptions and chart notes; and added facsimile stamps to supporting documentation to make it appear as though physicians’ offices had sent the documents to Orbit Medical.  

On Oct. 23, 2013, a federal grand jury in Utah indicted Jake Kilgore on three counts of health care fraud, three counts of false statements related to health care and three counts of wire fraud, all arising from his tenure with Orbit Medical.

The lawsuit was originally filed by two former Orbit employees, Dustin Clyde and Tyler Jackson, under the whistleblower provisions of the False Claims Act.  The Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  The Act also allows the government to intervene, 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 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.

Alliance Rehabilitation, LLC and Active Physical Therapy Services, LLC, along with three individuals associated with those businesses, have agreed to pay the federal government $2.78 million to settle allegations that the companies knowingly submitted or caused the submission of false claims to Medicare and the TRICARE health care program, the U.S. Attorney’s Office for the District of Columbia announced yesterday.

The settlement resolves allegations that the companies submitted claims which falsely represented that the physical therapy services being billed were either rendered or directly supervised by the physical therapist identified on the claims by his or her National Provider Identifier (NPI) number. In fact, the physical therapist identified on the claim had no involvement in the services rendered.  The settlement also resolves allegations that Alliance Rehabilitation, LLC, and Active Physical Therapy Services, LLC, sought payment from TRICARE for physical therapy services that were not provided by the physical therapist identified on the claim.

In addition to the False Claims Act settlement, the companies and the associated individuals have entered into a five-year Corporate Integrity Agreement with the U.S Department of Human Health and Services Office of Inspector General.  That agreement imposes integrity obligations on each of the entities and individuals and requires them, among other things, to retain an independent review organization to review their coding, billing, and claims submissions to Federal health care programs.

The lawsuit was originally filed by two former Alliance employees under the whistleblower provisions of the False Claims Act.  The Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  The whistleblowers in this case will receive $400,000 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 andhow you can take action.

Lantheus Medical Imaging and Bristol-Myers Squibb have agreed to pay $6.2 million to settle allegations that the company failed to pay New York State and City taxes, in violation of the False Claims Act, the New York Attorney General’s office announced.

Lantheus and its former parent company, Bristol-Myers Squibb, allegedly did not pay applicable New York State business franchise taxes, New York City corporation taxes or MTA surcharges from 2002 to 2006, when Lantheus was known as Bristol-Myers Squibb Medical Imaging. During that period, the company derived substantial revenues from its sales of medical imaging products to hospitals, clinics and other facilities in New York and from its training and servicing activities in connection with its sales.

The lawsuit was originally filed by a tax services provider who became aware of Lantheus’ failure to pay New York taxes, under the whistleblower provision of New York’s False Claims Act.  The Act is one of the state's most powerful civil fraud enforcement tools because it allows whistleblowers and prosecutors to take legal action against companies or individuals that defraud the government.  Under the False Claims Act, whistleblowers may be eligible to receive up to 30 percent of any money recovered by the government as a result of information they provide. The whistleblower in this action will receive $1.1 million from the settlement proceeds.

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.

American Family Care Inc. has agreed to pay $1.2 million to settle allegations that the company knowingly submitted or caused the submission of false claims to the federal health care program Medicare, the U.S. Department of Justice announced today.  American Family Care is a network of walk-in medical clinics headquartered in Birmingham, Ala., with offices in Alabama, Tennessee and Georgia.

Following guidance adopted by the Centers for Medicare and Medicaid Services, health clinics such as American Family Care bill Medicare for their services by selecting a corresponding Evaluation and Management code.  The codes are divided into five different levels - from basic (level 1) to most complex (level 5).  Higher level codes result in higher reimbursement from Medicare than lower level codes.  The government alleged that American Family Care knowingly selected Evaluation and Management codes for a level of services that exceeded those actually provided in order to artificially increase the amount of reimbursement it received for those visits.

The lawsuit was originally filed by Anita C. Salters, a former American Family Care employee, under the whistleblower provision of the False Claims Act.  The Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Salters’ 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.