Healthcare reform in the United States

A settlement has been reached in a whistleblower class action lawsuit brought against three home health agencies.   Nursing Personnel Home Care (Nursing Personnel), Extended Home Care (Extended) and Excellent Home Care (Excellent) are accused of submitting false claims to the New York Medicaid and Medicare programs.

The United States is receiving approximately $9.7 million as a result of the settlement with these three companies, and the state of New York is receiving approximately $14.3 million, for a total recovery of $24 million. The settlement resolves allegations from two different lawsuits filed by whistleblowers. One of the whistleblowers will receive $251,107 from the government’s recovery from Nursing Personnel. The other whistleblower's reward is $1,663,040 from the government’s recovery from Extended and Excellent.

The first of the two lawsuits was filed in 2006.  The United States alleged Nursing Personnel Home Care (Nursing Personnel) knowingly supplied aides with phoney training certificates to Extended Home Care (Extended) and Excellent Home Care (Excellent), which then billed New York Medicaid for the aides’ services; that Extended and Excellent knowingly billed for aides with phoney certificates who were untrained; and that Extended and Excellent knowingly submitted claims to the Medicare program for home health aide services purportedly rendered by aides supplied by Nursing Personnel that were not actually provided.

A settlement has been reached in a whistleblower class action lawsuit brought against Visiting Physicians Association who is accused of submitting false claims to Medicare, TRICARE and the Michigan Medicaid program.

The lawsuit was one of four filed against the defendants.  The whistleblowers will share in a recovery of approximately $1.7 million.

The United States alleged that Visiting Physicians Association submitted claims to the Medicare, TRICARE and Michigan Medicaid for unnecessary home visits and care plan oversight services, for unnecessary tests and procedures, and for more complex evaluation and management services than the services that Visiting Physicians Association actually provided.

A settlement has been reached to resolve False Claims Act allegations against Kaiser Foundation Hospitals. Kaiser Sunnyside Medical Center, Kaiser Foundation Health Plan of the Northwest and Northwest Permanente P.C., Physicians & Surgeons (collectively, Kaiser NW) are accused of billing Medicare without obtaining written certifications of terminal illness required under the federal health care program.

Medicare hospice care providers like Kaiser NW must obtain written certifications of terminal illness for each hospice beneficiary’s initial certification period (the first 90 days of care) from the medical director of the hospice and the individual beneficiary’s attending physician, if the beneficiary has one. Medicare requires a hospice to obtain these certifications prior to billing Medicare in order to help ensure that hospice care is medically necessary.

In June 2005, Kaiser NW submitted a report to the Department of Health and Human Service’s Office of Inspector General disclosing that between October 2000 and March 2004, there were instances in which Kaiser NW did not obtain written certifications of terminal illness for hospice beneficiaries prior to billing Medicare for the beneficiaries’ initial certification period. The settlement announced today resulted from the company’s disclosure.

A settlement has been reached in a whistleblower class action lawsuit brought against Brookhaven Memorial Hospital who is accused of fraudulently inflating charges to Medicare.

The United States settled for $2.92 million, plus interest and the whistleblower will receive roughly $613,000, plus interest.

The case was originally filed by a whistleblower in 2005 against two different hospitals.  The United States alleged that the hospitals defrauded Medicare by fraudulently inflating their charges to Medicare patients to obtain enhanced reimbursement from Medicare.

In addition to its standard payment system, Medicare provides supplemental reimbursement, called "outlier payments," to hospitals and other health care providers in cases where the cost of care is unusually high. Congress enacted the supplemental outlier payments system to ensure that hospitals possess the incentive to treat inpatients whose care requires unusually high costs. The lawsuit alleged that the hospitals inflated their charges to obtain supplemental outlier payments for cases that were not extraordinarily costly and for which outlier payments should not have been paid.

A settlement has been reached in a whistleblower class action lawsuit brought against Trinitas Regional Medical Center who is accused of fraudulently inflating charges to Medicare.

The United States settled for $3.02 million, plus interest and the whistleblower will receive a share of the recovery totalling approximately $679,000.

The case was originally filed by a whistleblower in 2005 against two different hospitals.  The United States alleged that the hospitals defrauded Medicare by fraudulently inflating their charges to Medicare patients to obtain enhanced reimbursement from Medicare.

In addition to its standard payment system, Medicare provides supplemental reimbursement, called "outlier payments," to hospitals and other health care providers in cases where the cost of care is unusually high. Congress enacted the supplemental outlier payments system to ensure that hospitals possess the incentive to treat inpatients whose care requires unusually high costs. The lawsuit alleged that the hospitals inflated their charges to obtain supplemental outlier payments for cases that were not extraordinarily costly and for which outlier payments should not have been paid.

A settlement has been reached in a whistleblower class action lawsuit brought against Mylan Pharmaceuticals, UDL Laboratories, AstraZeneca Pharmaceuticals and Ortho McNeil Pharmaceutical.  They are accused of failing to pay appropriate rebates to state Medicaid programs for drugs paid for by those programs.

Mylan and UDL agreed to pay $118 million to resolve allegations that they underpaid their rebate obligations with respect to several Mylan drugs (nifedipine extended release tablets, flecainide acetate, selegiline HCL, Orphenadrine Citrate Aspirin and Caffeine tablets, Triamterene/Hydrochlorothiazide, Propoxyphene HCL, Propoxyphene HCL/Aspirin/Caffeine, Prophyxphene Napsylate/Acetaminophen, Ibuprofen tablets, Bumetanide, Cephalexin and Cefactor) and several UDL drugs (nifedipine extended release tablets, selegiline HCL, Triamterene & HCTZ, Propox Naps & APAP, Flecainide Acetate, Trihexyphenidyl, Ranitidine HCL syrup, Sucralfate Suspension, Selegiline HCL and Bumetanide). Because the Medicaid program is funded by both the federal and state governments, the federal government received $60,896,476.00, the states $49,824,389.00 of the settlement amount and $7,279,135.00 will be paid to entities that participated in the Public Health Service’s Drug Pricing Program.

Separately, AstraZeneca paid $2.6 million ($1.43 million to the federal government and $1.17 million to the states) to resolve allegations that it underpaid its rebate obligations with respect to Albuterol. Ortho McNeil paid $3.4 million ($1.87 million to the federal government and $1.53 million to the states) to resolve allegations that it underpaid its rebate obligations with respect to Dermatop.

The whistleblower will receive a $10,787,392 share of the total recovery.

Filed in 2010, the United States alleged that all four companies had sold innovator drugs that were manufactured by other companies and had classified those drugs as non-innovator drugs for Medicaid rebate purposes. As a result of the improper classification of these drugs, the companies underpaid their rebate obligations under the Medicaid Rebate Program. The Medicaid Prescription Drug Rebate Program was enacted by Congress in 1990 out of concern for the costs the Medicaid was paying for outpatient drugs. By agreeing to participate in the Medicaid Rebate Program and signing these rebate agreements, the four companies agreed to pay quarterly rebates to Medicaid that were based upon the amount of money that health care program paid for each company’s drugs. The precise amount of a rebate is determined in part by whether a drug is considered an "innovator" drug or a "non-innovator" drug. The rebate that must be paid for innovator drugs is higher than the rebate for non-innovator drugs.

According to the terms of the settlement, the state of New York will pay $440 million over time, partly in cash and partly by releasing its claim to payments withheld. New York City’s share of the settlement, $100 million, will also be paid over time. The whistleblower in this case will receive $10 million from the settlement.

The United States alleged that for the period 1990 to 2001, the state of New York knowingly failed to provide proper guidance to the districts and counties outlining the requirements for a service to be covered by the Medicaid program, failed to monitor the districts and counties for compliance as required by the program and passed on claims to the federal government for services it knew were not covered or properly documented, all to make the United States pay a larger share of New York’s Medicaid costs.

The government additionally asserted New York City submitted claims to the state for false speech services. The state then passed these claims on to the federal government for Medicaid reimbursement.

A settlement has been reached in a whistleblower class action lawsuit brought against Regency Nursing and Rehabilitation Centers Inc who is accused of submitting false claims to Medicare and the Texas Medicaid program.

Specifically the United States complaint alleged that Regency submitted claims for reimbursement to Medicare and Medicaid for rehabilitation and skilled nursing services that were not reimbursable because the nursing home residents were not qualified for the services, the services were not medically necessary, or they were not supported by adequate documentation.

A settlement has been reached in a whistleblower class action lawsuit brought against Aventis Pharmaceutical Inc., a wholly owned subsidiary of sanofi-aventis U.S. LLC.  Aventis is accused of misreporting drug prices in order to reduce its Medicaid Drug Rebate obligations.

According to the settlement, the federal recovery is approximately $49 million. Aventis will also pay over $40 million to the Medicaid participating states, and over $6 million to certain public health services entities who paid inflated prices for the drugs at issue.

The United States complaint alleged that between 1995 and 2000, Aventis and its corporate predecessors knowingly misreported best prices for the steroid-based anti-inflammatory nasal sprays Azmacort, Nasacort and Nasacort AQ. Under the Medicaid Drug Rebate Statute, Aventis was required to report to Medicaid the lowest, or "best" price that it charged commercial customers, and pay quarterly rebates to the states based on those reported prices.

In order to avoid triggering a new best price that would obligate it to pay millions of dollars in additional drug rebates to Medicaid, Aventis entered into "private label" agreements with the HMO Kaiser Permanente that simply repackaged Aventis’s drugs under a new label. As a result, Aventis underpaid drug rebates to the Medicaid program and overcharged certain Public Health Service entities for these products.

A settlement has been reached in a whistleblower class action lawsuit brought against San Mateo Medical Center (SMMC) who is accused of submitting false claims to the United States in connection with payments from the Medicare and Medicaid programs.

The whistleblower that filed the orignal complaint will receive $1,020,000.

The government alleges that SMMC falsely inflated its bed count to Medicare in order to receive higher payments under Medicare’s Disproportionate Share Hospital (DSH) adjustment. The DSH adjustment is an extra Medicare payment available to hospitals that meet certain requirements, including having 100 or more acute care beds.

In addition, the government alleges that San Mateo County improperly obtained federal payments under the Medicaid program for services provided to patients at Institutes of Mental Disease (IMDs) who were between the ages of 22 and 64. Such services are ineligible for federal funding, and San Mateo County was required to separately report them to the California Department of Mental Health so that the state could ensure that no federal funds were used to pay for them. Medicaid (known as Medi-Cal in California) is a program funded jointly by federal and state funds. The settlement covers conduct from 1997 to 2007.