False Claims Act

A settlement has been reached in a whistleblower class action lawsuit brought against Dr. Todd J. Scarbrough and Melbourne Internal Medicine Associates P.A. (MIMA), who are accused of submitting false claims to Medicare and the military’s health care program - TRICARE.

The whistleblower will receive $2.64 million of the settlement.

The case was originally filed in July 2008.  The United States alleged MIMA Cancer Center had defrauded the federal health care programs by improperly inflating claims through various schemes specifically designed to cloak the fraudulent practices. In particular, the MIMA Cancer Center billed for services not supervised, duplicate and unnecessary services, services not rendered and upcoded services - a practice in which provider services are billed for higher procedure codes than were actually performed. The United States’ investigation found that MIMA executives had knowledge of a substantial number of the fraudulent billing practices at the facility, but had failed to stop the fraudulent billing.

A settlement has been reached in a whistleblower class action lawsuit brought against Atricure Inc who is accused of submitting false and fraudulent claims for Medicare reimbursement.

The whistleblower that filed this lawsuit will receive a total of $625,000.

The case was originally filed in 2007.  The United States alleged that Atricure marketed its medical devices to treat atrial fibrillation (the most common cardiac arrhythmia or abnormal heart rhythm), a use that is not approved by the U.S. Food and Drug Administration (FDA). Atricure also allegedly promoted expensive heart surgery using the company’s devices when less invasive alternatives were appropriate, advised hospitals to up-code surgical procedures using the company’s devices to inflate Medicare reimbursement, and paid kickbacks to health care providers to use its devices. The United States asserted that by engaging in this conduct, Atricure knowingly violated the Food, Drug, and Cosmetic Act and caused the submission of false and fraudulent claims in violation of the False Claims Act.

A settlement has been reached to resolve False Claims Act allegations against Lincoln Fabrics Ltd, and its American subsidiary.  They are accused of knowingly selling the government defective products.

In October 2009, the United States filed suit against Lincoln for violations of the False Claims Act and related claims. The $4 million settlement resolves this lawsuit.

The United States allegations are in relation to Lincoln Fabrics Ltd's role in the weaving of Zylon fabric used in the manufacture and sale of defective Zylon bullet-proof vests.

Using Zylon fiber manufactured by Toyobo Corp., Lincoln wove ballistic fabric for the body armor industry. Lincoln’s woven Zylon fabric was used in the manufacture of Zylon bullet-proof vests sold by several companies, including Second Chance Body Armor Inc., First Choice Armor Inc. and Point Blank Body Armor Inc. These vests were purchased by the United States, and by various state, local, and/or tribal law enforcement agencies, who were partially reimbursed by the United States.

The United States alleged that the Zylon in these vests lost its ballistic capability quickly, especially when exposed to heat and humidity. The United States further alleged that Lincoln was aware of the defective nature of the Zylon by at least December 2001, but continued to sell Zylon for use in ballistic armor until August 2005, when the National Institute of Justice issued a report that Zylon degraded quickly in ballistic applications. At that time, all American body armor manufacturers stopped using Zylon in body armor.

A settlement has been reached to Resolve False Claims Act allegations against Mercy Hospital Inc (d/b/a Mercy Medical Center) of Springfield, MA, who is accused of failing to adhere to Medicare guidelines.

In June 2007, Mercy disclosed to the Department of Health and Human Services Office of Inspector General that it could not demonstrate that it had provided the required level of therapy.

The settlement resulted from the company’s disclosure.  The allegations were that Mercy Medical Center, between 2005 and 2006, failed to provide, or failed to document that it provided, the minimum number of hours of rehabilitation therapy required under Medicare guidelines.

Under Medicare, inpatient rehabilitation hospitals must provide a minimum amount of rehabilitative therapy to their patients.

A settlement has been reached to resolve False Claims Act allegations against University of Phoenix who is accused of student recruitment policies that violated the False Claims Act.

The two whistleblowers will receive $19 million from the settlement.

This case began as a whistleblower action against another company. Though the United States did not intervene in this action, the Government provided support and assistance to the whistleblowers at many stages of the case.

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 to resolve False Claims Act allegations against St. John Health System who is accused of paying physicians or physician groups to induce referrals for medical services.

In April 2008, St. John submitted a self-disclosure report to the Department of Health and Human Service’s Office of Inspector General that acknowledged that the physician agreements may have run afoul of federal law. The settlement resulted from the company’s disclosure.

The United States determined that St. John made payments to 23 individual physicians or physician groups to induce referrals for medical services.

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 Spectranetics Corporation who is accused of causing false claims to be submitted to the Medicare Program.

The United States allegations were that the company illegally imported unapproved medical devices and provided them to physicians for use in patients, conducted a clinical study in a manner that failed to comply with federal regulations and promoted certain products for procedures for which the company had not received Food and Drug Administration approval or clearance.

A settlement has been reached in a whistleblower class action lawsuit brought against AT&T Missouri (formerly known as Southwestern Bell Telephone L.P.), who is accused of engaging in non-competitive bidding practices for Federal Communications Commission contracts.

The whistleblower will receive a $195,000 share of the government's settlement.

Originally filed in 2006, the United States alleged that the Company violated the False Claims Act in connection with the Federal Communications Commission's E-Rate program. 

The E-Rate program, which Congress created in the Telecommunications Act of 1996, provides funding for needy schools and libraries to connect to and utilize the Internet. Under the program, which is supported by fees collected from telephone users, schools apply for funds to pay for hardware and monthly connectivity service fees.

The government's complaint asserted AT&T Missouri provided false information to the E-Rate program and otherwise violated the program’s requirements by engaging in non-competitive bidding practices for E-Rate contracts. The United States further alleged that AT&T Missouri employees colluded with officials in the Kansas City, Mo., School District to award contracts to the company, extended contracts in violation of E-Rate rules and provided meals and other inducements to school district employees.