Healthcare Fraud

$6 Million Settlement Reached to Resolve False Claims Act Allegations against Quest Diagnostics Inc

Settlement Amount: 
$6,000,000

A settlement has been reached to resolve False Claims Act allegations against Quest Diagnostics Inc.

The allegations arose from a lawsuit that claimed Berkeley HeartLab Inc, violated the False Claims Act by paying kickbacks to physicians and patients to induce the use of Berkeley for blood testing services and by charging for medically unnecessary tests. Quest Diagnostics acquired Berkeley in 2011.

According to the government’s complaint, Berkeley allegedly paid kickbacks to referring physicians disguised as “process and handling” fees. Also, the complaint alleged that Berkeley paid kickbacks to patients by routinely waiving copayments owed by certain patients who were legally required to pay for part of their tests. Allegedly, Berkeley paid the kickbacks to induce both the physicians and patients who received them to choose Berkeley over other laboratories. The government’s complaint further alleged that these illegal practices resulted in medically unnecessary cardiovascular tests being charged to federal healthcare programs.

“We rely on doctors to provide honest, independent recommendations regarding clinical testing,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “Companies that pay kickbacks to referring doctors corrupt those doctors’ independence, leaving patients vulnerable to expensive and unnecessary testing.”

Whistleblowers share of the settlement with Quest Diagnostics has not been determined.

Sort Amount: 
6000000.00
Company: 
Quest Diagnostics Inc

United States Intervenes In False Claims Act Lawsuit against UnitedHealth

The Justice Department announced today, that the United States has intervened and filed a complaint in a lawsuit against UnitedHealth Group Inc (UHG), alleging the Company obtained inflated risk adjustment payments based on untruthful and inaccurate information about the health status of beneficiaries enrolled in UHG's largest Medicare Advantage Plan, UHC of California.

According to the United States, allegedly UHG knowingly disregarded information about beneficiaries' medical conditions, which increased the payments UHG received from Medicare.

“Since 2005, UnitedHealth knew that many diagnosis codes that it submitted to the Medicare Program for risk adjustment were not supported and validated by the medical records of its enrolled beneficiaries,” according to the complaint. In February, the United States joined a related lawsuit filed by a whistleblower in California alleging that UnitedHealth defrauded the Medicare program.

“Medicare Advantage plans not only receive taxpayer-funded payments, but are intended for the health and welfare of the beneficiaries,” said Acting U.S. Attorney Sandra R. Brown for the Central District of California. “This action sends a warning that our office will continue to scrutinize and hold accountable Medicare Advantage insurers to safeguard the integrity of the Medicare program.”

The lawsuit was brought forward by a former employee of Senior Care Action Network Health Plan and a consultant to the risk adjustment industry, James Swoben, who will receive a share of any recovery.

Company: 
UnitedHealth

$2.7 Million Settlement reached in Whistleblower case with an Encino Dermatologist

Settlement Amount: 
$2,700,000

A settlement has been reached to resolve fraud allegations against the owner of The Skin Cancer Medical Center.

The allegations arose from a lawsuit that claimed the owner of The Skin Cancer Medical Center submitted bills to Medicare for Mohs micrographic surgeries for skin cancers that were medically unnecessary.

According to the U.S. Attorney's Office, the owner of The Skin Cancer Medical Center, Dr. Norman A. Brooks, paid the $2,681,400 settlement on April 10 without admitting liability.

Allegedly, Brooks falsely diagnosed skin cancer in some of his patients so that he could perform and bill for Mohs surgeries. This specialized procedure is used for removing certain types of skin cancers in specific areas of the body, including the face.

Reportedly, as part of the settlement, Brooks entered into a three-year Integrity Agreement with the U.S. Department of Health and Human Services, Office of Inspector General. Under the Integrity Agreement, Brooks will establish and maintain a compliance program that includes, among other things, mandated training for Brooks and his employees and review procedures for claims submitted to Medicare and Medicaid programs.

This lawsuit was brought forward by a former employee, Janet Burke, who will receive $482,500 for her role in the case.

Sort Amount: 
2700000.00
Company: 
The Skin Cancer Medical Center

$1 Million Settlement reached to resolve False Claims Act Allegations against Natural Way Chiropractic Center

Settlement Amount: 
$1,038,903

A settlement has been reached to resolve False Claims Act allegations against Brian Schnitta and his clinic, Natural Way Chiropractic Center P.A.

The allegations arose from a lawsuit that claimed Brian Schnitta and his clinic, Natural Way Chiropractic Center submitted false claims to Medicare for treating patients with peripheral neuropathy.

According to the government, allegedly from July 1, 2011 through May 31, 2013, Schnitta and the clinic claimed they provided treatments for peripheral neuropathy and charged Medicare for several procedures that were not medically necessary or not otherwise covered by the program. The claimed procedures included nerve conduction tests, nerve block injections, and ultrasound needle guidance. Peripheral neuropathy affects nerves in the hands and feet and includes symptoms such loss of sensation and/or a burning sensation.

“Medicare is designed to ensure that this country’s elderly have access to vital health care services,” U.S. Attorney Tom Beall said. “This office will continue efforts to protect the program and beneficiaries from providers that submit false claims for personal gain.”

Reportedly, Brian Schnitta, and Natural Way Chiropractic Center, agreed to pay $1,038,903 to the U.S. government. Schnitta and Natural Way agreed to the settlement while maintaining that they were not guilty of any wrongdoing.

Sort Amount: 
1038900.00
Company: 
Natural Way Chiropractic Center

University of California Alleges $12 Million Health Fraud Scheme

Settlement Amount: 
$12,000,000

According to University of California,  allegedly a group of physicians defrauded students’ self-funded health care benefit plan of $12 million by prescribing thousands of drugs to students who did not know they had been dispensed under their names.

University of California sued Studios Pharmacy, Excel Care Pharmacy, Pharma Pro Solutions and California Clinical Trials, and 17 people in Superior Court, claiming they “drained” the University of California Student Health Insurance Plan of millions of dollars through false claims.

Allegedly, students were also targeted with social media ads that offered them as much as $550 to enroll in "sham clinical trials" by California Clinical Trials, LLC.  

Reportedly, many of the students were also prescribed pain creams, normally given to patients who suffer from arthritis, without even being examined by doctors. Altogether, possibly over 500 students handed over their personal information to the company.

California Clinical Trials LLC, allegedly attended college job fairs, telling students about marketing job opportunities at pharmaceutical companies if they revealed their health insurance and medical information and were willing to try medications.

"This needs to be immediately stopped," Dr. John Stobo, the executive vice president for UC Health, said in a statement. "We have identified nine different health care providers who prescribed medications to these students, likely without any indication of physical exams or even a physician-patient relationship."

Reportedly, prescribers wrote over hundreds of prescriptions a day causing the UC Student Health Insurance Plan almost $1 million a day in losses.

The prescription medications allegedly involved in this scheme include Dermacin, Inflammacin, Diclofex, Mebolic, Migranow, Inflammation Reduction Pak, Xelitral, and perhaps others.

University of California is warning students to beware of anyone offering free samples or easy cash in exchange for personal information.

Sort Amount: 
12000000.00
Company: 
University of California

$11.4 Million Settlement reached to resolve False Claims Act Allegations against Pacific Pulmonary Services

Settlement Amount: 
$11,400,000

A settlement has been reached to resolve False Claims Act allegations against Pacific Pulmonary Services.

The allegations arose from a lawsuit that claimed Pacific Pulmonary Services filed false reimbursement claims with federal health care programs and arranged a kickback scheme with sleep-testing clinics.

According to the Department of Justice, Pacific Pulmonary Services has since about 2004 submitted claims for reimbursement to Medicare, Tricare and federal employee health benefits programs for home oxygen and related equipment without physicians’ approval, as required by program rules.

Also, in 2006, certain of the company’s patient care coordinators also allegedly agreed to make patient referrals to sleep testing clinics in exchange for those clinics’ agreement to refer patients to Pacific Pulmonary Services for sleep therapy equipment.

Reportedly, Pacific Pulmonary Services is the business name of Braden Partners LP and Teijin Pharma USA LLC. Pacific Pulmonary Services provides oxygen tanks, related supplies and sleep therapy equipment.

“This settlement demonstrates our tenacity in pursuing health care providers who seek to take advantage of federal healthcare programs,” said Acting Assistant Attorney General Readler.  “Providers who cut corners and pay kickbacks should be aware that they may face serious consequences.”

A former Pacific Pulmonary sales representative, Manuel Alcaine, will receive $1.824 million, or about 16 percent of the settlement. Mr. Alcaine sued the company in 2010 under the whistleblower provisions of the False Claims Act, which allows private citizens who expose fraud against the government to share in any recovery.

Sort Amount: 
11400000.00
Company: 
Pacific Pulmonary Services

$9.86 Million Settlement reached to resolve False Claims Act Allegations against Walgreen Co.

Settlement Amount: 
$9,860,000

A settlement has been reached to resolve False Claims Act allegations against Walgreen Co.

The allegations arose from a lawsuit that claimed Walgreen Co. knowingly submitted claims for reimbursement to California’s Medi-Cal program that were not supported by applicable diagnosis and documentation requirements.

Allegedly, Walgreens improperly billed Medi-Cal for certain prescription drugs, "Code 1" drugs, appearing on Medi-Cal's formulary list.  As alleged, Walgreens knowingly failed to comply with applicable "Code 1" drug restrictions and documentation requirements by failing to ensure that the drugs were prescribed for the requisite diagnoses prior to dispensing the drugs to Medi-Cal beneficiaries.

Reportedly, the allegations resolved by this settlement were first raised in two lawsuits filed by a former Walgreens pharmacist and a former pharmacy technician. The whistleblowers will receive roughly $2.3 million as part of the settlement.

“This settlement illustrates our commitment to protect the integrity of California’s Medi‑Cal program,” said U.S. Attorney Talbert. “Regulations like those at issue here protect both critical funding and beneficiaries served. My office will continue working to ensure that pharmacies comply with these regulations.”

Sort Amount: 
9860000.00
Company: 
Walgreen Co.

$20 Million Settlement Reached to Resolve False Claims Act Allegations against a Pain Management Physician, Dr. Robert Windsor

Settlement Amount: 
$20,000,000

A settlement has been reached to resolve False Claims Act allegations against Dr. Robert Windsor which operated under the umbrella of National Pain Care Inc.

The allegations arose from lawsuits that claimed Dr. Robert Windsor which operated under the umbrella of National Pain Care Inc billed federal health care programs for surgical monitoring services that he did not perform and for medically unnecessary diagnostic tests.

According to the government, Dr. Robert Windsor engaged in two schemes. First, the government alleges that Dr. Windsor caused the submission of false claims to Medicare, TRICARE, and FEHBP for the online, real time intraoperative monitoring of surgeries that Dr. Windsor did not personally monitor, that were not monitored by a physician, and that Dr. Windsor falsely represented had been monitored by him during the period from January 1, 2008 through July 22, 2013. On October 24, 2016, Dr. Windsor was sentenced to three years, two months in federal prison and three years of supervised release in connection with this conduct.

“Windsor placed patients at risk by claiming that he was monitoring the neurological health of patients during surgery when he actually had an unqualified medical assistant do the work,” said U.S. Attorney John Horn. “Windsor unfortunately put his own interests above the health and safety of his patients.”

Also, the government alleges that that between January 2010 and June 2014, Dr. Robert Windsor took part in submitting false claims to Medicare, the Kentucky and Georgia Medicaid programs, and other insurance providers for medical tests and procedures that were not necessary.

Dr. Robert Windsor agreed to sell most of his commercial and residential properties and other assets, such as boats and jet skis, to try to settle the $20 million judgment.

The settlement resolves two lawsuits filed by three whistleblowers, Kris Frankenberg, Stephanie Herder, and Bradley Davis, who will share in the settlement.

Sort Amount: 
20000000.00
Company: 
Dr. Robert Windsor

$60 Million Settlement reached to resolve False Claims Act Allegations against TeamHealth Holdings

Settlement Amount: 
$60,000,000

A settlement has been reached to resolve False Claims Act allegations against TeamHealth Holdings.

The allegations arose from a lawsuit that claimed TeamHealth Holdings, as successor in interest to IPC Healthcare Inc (IPC) violated the False Claims Act by billing Medicare, Medicaid, the Defense Health Agency and the Federal Employees Health Benefits Program for higher and more expensive levels of medical service than were actually performed.

According to the Department of Justice, the government contended that allegedly IPC knowingly and systematically encouraged false billings by its hospitalists, who are medical professionals whose primary focus is the medical care of hospitalized patients. Particularly, the government alleged that IPC encouraged its hospitalists to bill for a higher level of service than actually provided. IPC’s scheme to improperly maximize billings allegedly included corporate pressure on hospitalists with lower billing levels to “catch up” to their peers.

Reportley, TeamHealth, as part of the settlement,  entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) covering the company’s hospital medicine division. This CIA is designed to increase TeamHealth’s accountability and transparency so that the company will avoid or promptly detect future fraud and abuse.

“When health care companies boost their profits by misrepresenting the services they bill to taxpayer-funded health care programs, our office will make sure they are held accountable for their deceptive schemes and that they make changes to bill these programs appropriately,” said Special Agent in Charge Lamont Pugh of HHS-OIG.

The whistleblower, Dr. Bijan Oughatiyan, a physician formerly employed by IPC as a hospitalist, will receive approximately $11.4 million from the settlement.

Sort Amount: 
60000000.00
Company: 
TeamHealth Holdings

$150 Million Settlement reached to resolve False Claims Act Allegations against McKesson Corporation

Settlement Amount: 
$150,000,000

A settlement has been reached to resolve False Claims Act allegations against McKesson Corporation.

The allegations arose from a lawsuit that claimed McKesson Corporation violated the Controlled Substances Act (CSA).

According to the Department of Justice, allegedly McKesson failed to design and implement an effective system to detect and report “suspicious orders” for controlled substances distributed to its independent and small chain pharmacy customers – i.e., orders that are unusual in their frequency, size, or other patterns. From 2008 until 2013, McKesson supplied various U.S. pharmacies an increasing amount of oxycodone and hydrocodone pills, frequently misused products that are part of the current opioid epidemic.

For example, in Colorado, McKesson processed more than 1.6 million orders for controlled substances from June 2008 through May 2013, but reported just 16 orders as suspicious, all connected to one instance related to a recently terminated customer. 

As part of the settlement, McKesson will have to suspend sales of controlled substances from distribution centers in Colorado, Ohio, Michigan and Florida for several years. The settlement also imposes new and enhanced compliance obligations on McKesson’s distribution system. Additionally, the government and McKesson agreed to enhanced compliance terms for the next five years. Also, McKesson has agreed to specific, rigorous staffing and organizational improvements; periodic auditing; and stipulated financial penalties for failing to adhere to the compliance terms and require to engage an independent monitor to assess compliance.

Sort Amount: 
150000000.00
Company: 
McKesson Corporation

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