Articles Posted in Health Care Fraud

The Department of Justice needs whistleblowers to report fraud involving drug pricing overbilling in the Medicare, Medicaid, TRICARE and FEHB programs.  There are potential rewards and protections for whistleblowers who have evidence of false claims against the Government.

In declining to dismiss a whistleblower’s lawsuit against Rite Aid for alleged drug overbilling, the court laid out the basis for its decision that the whistleblower’s lawsuit alleged sufficient evidence for the case to proceed.  The allegation was that Rite Aid charged Medicare, Medicaid, and TRICARE prices that exceeded prices paid by other customers.  A pharmacist who had worked for Rite Aid stepped forward with information that allowed the case to proceed, in April 2019.

Guidance is available for how to blow the whistle on your employer.  Reaching out to a former prosecutor who represents whistleblowers is a helpful first step.  An attorney can guide you through the process, assist you with documenting your concerns, answer your questions and instruct you on the nature and strength of evidence you do have.  A good whistleblower attorney will provide you a free consultation.  You should seek out an accomplished attorney as soon as you have concerns, and while you are still employed by the company where you believe there is wrong-doing.  Bottom line:  don’t do it alone.  Get an expert opinion from a prosecutor who’s tried False Claims Act cases and has significant experience under their belt.

The Department of Justice needs whistleblowers to continue to report health care fraud

The Health Care Industry is Responsible for Most of the False Claims Act Recoveries

Bloomberg Law published a piece in March 2019 about the the $270 million settlement with DaVita Medical Holdings LLC., the nation’s largest dialysis provider.  The claims involved fraudulent Medicare billing whereby a company subsidiary directed physicians to use improper billing codes for certain conditions, leading to payments that the Government otherwise would not have paid.  Typical for False Claims Act cases, this one involved medically necessary services at the expense of federal health care programs.  Also reported were other common schemes involving over-prescribing of opioids and the payment of kickbacks to induce physicians, hospitals, and clinics to prescribe certain drugs or refer patients to specific treatment facilities.  Many False Claims Act cases involve providers that are already subject to stringent requirements under Corporate Integrity Agreements.  As reported, Health Management Associates, a former hospital chain, also settled with the Government for $260 million making illegal payments to physicians in exchange for patient referrals.

The Department of Justice is continuing to fight the ongoing drug epidemic by pursuing companies and individuals that fraudulently compound medications, according to a DOJ press release issued on March 15, 2019.  DOJ charged 7 people in a $50 million health care fraud conspiracy targeting state health benefits programs.   DOJ needs whistleblowers to step forward and report fraud involving compounded drugs, which can lead to patient harm.

Guidance is available for how to blow the whistle on your employer.  Reaching out to a former prosecutor who represents whistleblowers is a helpful first step.  An attorney can guide you through the process, assist you with documenting your concerns, answer your questions and instruct you on the nature and strength of evidence you do have.  A good whistleblower attorney will provide you a free consultation.  You should seek out an accomplished attorney as soon as you have concerns, and while you are still employed by the company where you believe there is wrong-doing.  Bottom line:  don’t do it alone.  Get an expert opinion from a prosecutor who’s tried False Claims Act cases and has significant experience under their belt.

The authors represent whistleblowers / Renée Brooker (former Assistant Director for Civil Frauds/Justice Department) reneebrooker@finchmccranie.com (202) 288-1295 / Eva Gunasekera (former Senior Counsel for Health Care Fraud/Justice Department) eva@finchmccranie.com.

Through a $465 million settlement, Finch McCranie’s Michael A. Sullivan and James J. Breen of the Breen Law Firm successfully represented a whistleblower whose qui tam case under the False Claims Act helped return hundreds of millions to the United States and various states for Medicaid rebates underpaid on new EpiPen products introduced in 2009.

The Department of Justice announced the settlement on August 17, 2017, of two qui tam cases pending in the District of Massachusetts, United States, et al. ex rel. sanofi-aventis US LLC v. Mylan Inc., et al., and our case, United States, et al. ex rel. Ven-A-Care of the Florida Keys, Inc. Mylan Inc., et al..

These cases illustrate the importance of the False Claims Act to uncover and stop fraud and false claims in health care and other industries, which harm taxpayers by stealing taxpayer dollars needed to provide medical care and other services.

Today the Department of Justice announced the largest settlement in its history with a skilled nursing facility chain–a qui tam whistleblower case under the False Claims Act that our firm and our co-counsel Mark Simpson worked side-by-side with DOJ to prepare for trial.

We applaud the exceptional work of DOJ’s attorneys, as well the outstanding attorneys of the U.S. Attorney’s Office for the Eastern District of Tennessee.  Below is our press release on today’s settlement:

$145 Million Settlement in Groundbreaking Health Care Fraud “Whistleblower” Case by Atlanta’s Finch McCranie LLP and U.S. Department of Justice

Yesterday the Justice Department apparently responded to the frequent lament, “Why has almost no one gone to prison for the financial crisis?” DOJ signaled that it will now look to hold responsible both culpable individuals and their companies for corporate misdeeds–both criminally and civilly.

If DOJ means what it says, this policy change is profound. It should hit corporate officers whose business models are based on fraud and false claims. It should also snare high level executives who turn a blind eye to wrongdoing, and who typically get away with it.

Corporations can act only through the humans who run them. Sometimes those humans steer the business to corrupt methods.

Until yesterday’s change in DOJ policy, however, the few corporations brought to heel by DOJ for crimes, fraud, or false claims absorbed the consequences, while the individuals who directed the wrongdoing usually escaped responsibility. Those individuals were free to continue their corrupt practices at the same firm or a different one.

New U.S. Deputy Attorney General Sally Yates plans to change that result. As a federal prosecutor in Atlanta, Yates was not afraid of pursuing big cases against individuals and their companies, as I learned from representing clients in some of those cases.

Yesterday Yates issued a Memorandum titled, “Individual Accountability for Corporate Wrongdoing.” It is far-reaching, if implemented. Yates announced “six key steps to strengthen [DOJ’s] pursuit of individual corporate wrongdoing, some of which reflect policy shifts and each of which is described in greater detail below:
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Each December, some of the nation’s top health care lawyers gather to discuss developments in prosecuting and defending health care fraud cases at the Health Care Fraud Institute in Atlanta. Because the qui tam law–the False Claims Act– is the government’s primary civil tool to combat fraud and false claims, the False Claims Act developments are a highlight of the discussion.

This year, I was honored again to be invited to participate as part of the False Claims Act panel with Rick Shackelford, an accomplished defense lawyer at King & Spalding, LLP; Marlan Wilbanks, my colleague; and our excellent moderator, Jim Breen.

One of the major developments we focused on was the increasing number of cases in which the Justice Department relies on private attorneys representing whistleblowers (“relators”) to litigate cases, since the government has limited resources.

Each Fall, the Justice Department tallies its recoveries of taxpayer dollars that have been pilfered through fraud directed at federal programs. A year ago, DOJ proudly announced $3 billion in recoveries in False Claims Act cases, and a record $8.7 billion recovered in the three years starting in 2009.

Late this year, DOJ will announce that its fraud recoveries tripled from $3 million in FY 2011 to more than $9 million in FY 2012. This trend of increasingly large recoveries of stolen taxpayer funds proves once again the effectiveness of laws like the False Claims Act, which incentivize whistleblowers to expose fraud through its qui tam provisions.

Although health care cases account for the vast majority of FCA recoveries, growing areas include banking, mortgage, and pension fraud cases involving fraudulently obtained taxpayer dollars, as my colleagues at Taxpayers Against Fraud point out. States are also using their own false claims laws to recover stolen taxpayer funds.

In qui tam cases, private citizen whistleblowers (known as “relators”) file suit on the government’s behalf to expose fraud against taxpayer funds. The whistleblowers can receive 15-25% of the government’s recovery of stolen funds if the government prosecutes the case, and 25-30% if the government leaves it to the whistleblower to pursue the recovery.

Consider the history of False Claims Act recoveries that have totalled more than $39 billion since 1986, when Congress authorized meaningful rewards to whistleblowers:
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Last week the government’s criminal trial of former GlaxoSmithKline vice president and associate general counsel Lauren Stevens ended abruptly, as the judge found no basis to allow the case to go to a jury. Prosecutors had charged that she obstructed justice and made false statements to cover up the company’s improper marketing of the antidepressant drug Wellbutrin SR.

While she dodged a bullet, the case jolted lawyers handling health care fraud investigations, which are more typically civil cases under the False Claims Act.

Yet also last week, prosecutors succeeded in convicting Raj Rajaratnam for insider trading. Wall Street’s hedge fund industry took note of the government’s use of investigative tools such as recorded phone calls.

Of interest to whistleblowers reporting fraud under the False Claims Act, the IRS Whistleblower Program, or the brand new SEC Whistleblower and CFTC Whistleblower Programs is an upcoming presentation, “Avoiding the Mistakes of the UBS/Birkenfeld Case: Protecting Whistleblowers from Criminal and Civil Liability.”

This discussion is part of a fascinating gathering this April in South Beach–the OffshoreAlert Conference. As the brochure promises:

Where else could tax collectors mingle with tax minimizers, asset tracers with asset protectors, regulators with the regulated, whistleblowers with their former employers and crooks with prosecutors?

How to protect whistleblowers from criminal and civil liability was a topic my panel discussed at the 2010 IRS Whistleblower Boot Camp in Washington. Because we had the IRS Chief Counsel’s Office participating in that discussion, we were unable to discuss directly what went wrong for Birkenfeld as he brought important information about tax evasion to the attention of the IRS, but ended up serving a prison sentence of 40 months. (We have written previously about Birkenfeld’s errors revealed in the court record.)

At the OffshoreAlert Conference discussion this year, I will moderate the panel discussion about what can be done to protect whistleblowers from criminal and civil exposure. Joining me are former Justice Department official and former General Counsel of the U.S. Department of Homeland Security Joe D. Whitley; former prosecutor and now whistleblower attorney Marc Raspanti; and federal and international tax attorney Richard Rubin.

The program description is reprinted below:
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