Whistleblower Lawyer Blog

In a whistleblower lawsuit settlement, the Loma Linda Behavioral Science Center agreed to pay more than $2 million to resolve allegations of overbilling.

This False Claims Act whistleblower case was filed by a former employee of Healthcare Financial Advisors (HFA), a consulting firm that advises hospitals in preparing cost reports. The lawsuit alleges that HFA assisted its clients in seeking reimbursement for unallowable costs from Medicare and Medi-Cal.

Health care cases remain busy this week. The Justice Department on April 26 announced that it is joining whistleblowers in pursuing three qui tam lawsuits against HealthEssentials Solutions Inc. (HES) that allege false claims were submitted to Medicare.

The cases involve allegations of upcoding -- improperly using a diagnosis code that is not supported by the medical record, for the purpose of obtaining greater reimbursement--and billing for medically unnecessary services.

The three cases were filed separately in the U.S. District Court in Louisville, Ky., by former employees of HES.

Another state whistleblower law, with qui tam provisions that follow the federal False Claims Act, was born today. The Georgia Senate passed the "State False Medicaid Claims Act" today, and it goes to Governor Sonny Perdue for his signature.

We have been writing about this and other new state whistleblower statutes. Representative Edward Lindsey deserves credit for his sponsorship of the bill.

Our firm was fortunate enough to have been part of the legislative effort. Rep. Lindsey asked Michael A. Sullivan (one of this whistleblowerlawyerblog co-authors) to testify and explain the whistleblower law three times, before the House Judiciary Committee and the Senate Insurance and Labor Committee. There were no dissenting votes in any of the committee votes.

New York also recently approved a state False Claims Act, and many other states are considering them.

We look forward to following the progress in other states that are considering state False Claims Acts, so that they take advantage of the financial incentives Congress created in the Deficit Reduction Act.

Continue reading "Another State Qui Tam Whistleblower Law is Born--Georgia Bill Passes Senate and Goes to Governor for Signature" »

A new qui tam whistleblower law has cleared another hurdle toward passage. Georgia's Senate Insurance and Labor Committee unanimously approved the new "State False Medicaid Claims Act" this afternoon. As we have written about previously on this whistleblower lawyer blog, the new whistleblower law has already passed the Georgia House.

After an introduction by Senator Seth Harp, the bill's sponsor, Rep. Edward Lindsey, asked Inspector General Doug Colburn of the Department of Community Health and attorney Michael A. Sullivan (co-author of this whistleblower lawyer blog) of Finch McCranie, LLP to join him in testifying about how the new whistleblower law would work. Rep. Lindsey explained the incentives that Congress has provided to states to enact their own qui tam whistleblower laws, and then asked Sullivan to explain how the law would function.

Sullivan testified about the successes of the federal False Claims Act in not only recovering money from those who have defrauded the government, but also serving as a deterrent to those who might otherwise cheat the public. He explained how the funds recovered have increased dramatically since the 1986 Amendments that created the modern False Claims Act, especially in the health care area. Sullivan also described other states' successes with their own whistleblower statutes, as well as the strict review of state false claims statutes by the Office of Inspector General of the Department of Health and Human Services.

Inspector General Colburn explained to the Senators some of the other major provisions of the bill, and answered questions about the amount of suspected Medicaid fraud in his state. The Senators also questioned Rep. Lindsey, Inspector General Colburn, and Sullivan about how the bill would apply to medical providers in certain examples.

Although representatives of the health care industry were present, none cam forward to speak out against the bill or express any concerns.

The Committee voted unanimously to approve the new whistleblower law. It moves on to the Senate Rules Committee before consideration by the full Georgia Senate.

Once again, we at Finch McCranie, LLP are proud to be part of the process of helping enact laws that stop fraud against the government. We will continue to report on the progress of these smart and cost-effective laws both in Georgia and in other states.

We have had many calls this week from potential clients in our IRS Whistleblower practice, probably because msn.com featured an article about the IRS Whistleblower program on Monday that linked to our whistleblower lawyer blog.

As I have explained to many whistleblower clients, the new regulations for the IRS Whistleblower Rewards Program are in the works, but have not been issued. We have been pursuing IRS Whistleblower claims under the new program and have found the IRS agents to be excited about it.

Adding to the mix for those seeking a whistleblower attorney is that Congress is considering amendments to the law that established the new IRS Whistleblower Program in December 2006. Among the possible changes/additions are a provision opening up the Whistleblower Program to more claims by setting a different threshold for the amount of money in question, which could allow more whistleblowers to qualify for a reward.

Another provision would appropriate funds for the IRS Whistleblower Office, some of which might help defray expenses incurred by the whistleblower's legal representative. Yet another provision addresses the confidentialty of whistleblowers in Tax Court proceedings.

These proposed changes are part of HB 2, the "minimum wage" bill, which passed the Senate in February.

We will continue to keep up with any developments affecting the IRS Whistleblower Program, which we believe promises to be a great success. If you have any questions about the IRS Whistleblower program, feel free to email me here.

The current section of the proposed HB 2 that applies to the IRS Whistleblower Program is below:

Continue reading "Amendments to New IRS Whistleblower Law Considered" »

A subsidiary of the drug manufacturer Pfizer has agreed to plead guilty in a kickback scheme and to pay a criminal fine of $19.68 million, according to the U.S. Attorney for the District of Massachusetts, Michael J. Sullivan (not to be confused with Michael A. Sullivan, one of the authors of this whistleblower lawyer blog).

The government's announcement was that Pharmacia & Upjohn Company, Inc., a subsidiary of Pfizer, Inc., was charged with offering a kickback in connection with the administration and distribution of its human growth hormone, Genotropin. Another Pfizer subsidiary, Pharmacia & Upjohn Company LLC entered into a Deferred Prosecution Agreement with the Government for what the government described as illegally promoting Genotropin for “off-label” uses as anti-aging, cosmetic use and athletic performance enhancement. The result is that the companies will pay a total amount of $34.7 million.

The New York legislature has become the latest state to agree to the enactment of a State False Claims Act, when it approved passage of such a whistleblower law as part of approving the state budget. The Buffalo Times reported on this encouraging development.

We have written before about why states are passing their own whistleblower laws to protect taxpayer money. Congress has created significant financial incentives for states that pass their own state false claims acts, with whistleblower provisions that are at least as effective as the federal False Claims Act.

States whose whistleblower laws are approved by the Office of Inspector General are entitled to a 10% increase in their share of Medicaid fraud recoveries. OIG recently approved the whistleblower laws of Hawaii and Virginia, which now join Illinois, Massachusetts, and Tennessee as having whistleblower laws that qualify the state for the extra funds. OIG has disapproved the whistleblower laws of seven other states, California, Florida, Louisiana, Indiana, Michigan, Nevada, and Texas, which can still strengthen their laws to make them as effective as the federal False Claims Act.

New York Governor Elliott Spitzer and Attorney General Andrew Cuomo supported the whistleblower law.

We are encouraged that New York has taken the responsible step of protecting taxpayer funds by passing its own whistleblower law.