Archive

Sutter Health – Medicare Advantage Fraud ($90 million)

Constantine Cannon represented whistleblower Kathy Ormsby in a False Claims Act litigation against Sutter Health and its affiliates that resulted in a $90 million settlement – the largest Medicare Advantage FCA settlement to date against a hospital system, and the second largest reported Medicare Advantage fraud settlement to date. Ms. Ormsby, a former Risk Adjustment Factor Project Manager at Sutter Health affiliate Palo Alto Medical Foundation, alleged the Sutter Health defendants inflated the number and severity of Medicare Advantage patient diagnoses, manipulated patient records, ignored audit “red flags,” and engaged in other misconduct to increase patient risk scores and obtain Medicare Advantage payments to which they were not entitled. In Spring 2019, the Government intervened in Ms. Ormsby’s case as to PAMF, and Ms. Ormsby continued to pursue her claims against the other Sutter Health affiliates on a non-intervened basis. This settlement resolves all claims and follows Sutter’s unsuccessful effort to dismiss both the complaints. Read more: Press Release; Whistleblower Insider.

Tagged in: FCA Federal, Healthcare Fraud, Hospital Fraud, Managed Care, Provider Fraud, Risk Adjustment Fraud, Upcoding,

Kaiser Permanente – Medicare Advantage Risk Adjustment Fraud (Case Intervention)

Constantine Cannon represents Dr. James Taylor, a highly placed physician and healthcare coding expert, in False Claims Act litigation against Kaiser Permanente. He is among a group of ten whistleblowers who accuse the large Medicare Advantage organization of knowingly submitting false claims for risk-adjusted payments to the Centers for Medicare & Medicaid Services (CMS). The suit alleges that Kaiser routinely obtained fraudulently inflated risk-adjusted payments by knowingly submitting diagnosis codes for patients that were unsupported by the patients’ medical records, and the government’s intervention focuses on unsupported diagnosis codes that Kaiser allegedly improperly added through addenda to patients’ medical records. The qui tam whistleblower suit was unsealed on July 29, 2021. See: Taylor Amended Complaint; DOJ Press Release

Tagged in: FCA Federal, Healthcare Fraud, Managed Care, Risk Adjustment Fraud, Whistleblower Case,

Group Health Cooperative (now a subsidiary of Kaiser Permanente) – Medicare Advantage Fraud ($6.375 million)

Constantine Cannon represents whistleblower Teresa Ross against Group Health Cooperative, an insurance company that participates in the Medicare Advantage program. GHC has agreed to pay $6.375 million to resolve allegations that the insurance plan improperly collected money from the Medicare Advantage program by overstating how sick its beneficiaries were. Ms. Ross is a former employee of GHC, where she worked for 14 years; her most recent position was the director of risk adjustment services. In her complaint, Ms. Ross alleged that GHC had improperly relied on coders’ interpretations of diagnostic tests, prescriptions, and entries in problem lists to come up with diagnoses and that it had also submitted other codes that were false because they were diagnosed by inappropriate providers, fell outside service year, or the patient had no evidence of a current condition. See Press Release and Whistleblower Insider for more.

Tagged in: FCA Federal, Healthcare Fraud, Managed Care, Medical Billing Fraud, Medicare, Risk Adjustment Fraud, Whistleblower Case, Whistleblower Rewards,

Mid Dakota Clinic – Medicare Fraud/ASC Kickbacks ($5.45M)

The Constantine Cannon team represented Jeffery Neuberger, the former CEO of a medical group in North Dakota, in a 2017 False Claims Act case alleging a scheme in violation of the Anti-Kickback Statute (AKS) between the medical group and its wholly owned ambulatory surgery center (ASC). The AKS is intended to prevent abuses (such as unnecessary treatments) that can occur when a doctor makes money from referring patients for goods or services. The ASC safe-harbor to the AKS is limited; it essentially permits ASC ownership only by surgeons who perform procedures or surgeries in the ASC as a functional extension of his or her office. The lawsuit alleges that all of the multi-practice physician owners profited from referrals, not only the surgeons, and that they refused to give up this lucrative income stream despite knowing that it violated the AKS. In November 2019, Mid Dakota Clinic, its affiliated building partnership, and insurer agreed to pay the United States $4.15 million to resolve the case. The clinic additionally paid $1.3 million for the whistleblower’s attorneys’ fees and costs, for a total payment of $5.45 million. The United States awarded Mr. Neuberger a 25% relator’s share of its recovery.

Tagged in: Anti-Kickback and Stark, FCA Federal, Healthcare Fraud, Medicare, Provider Fraud, Whistleblower Rewards,

Visiting Nurse Service of New York – Medicare/Medicaid Home Health Care Fraud ($57 million)

Constantine Cannon represented whistleblower Edward Lacey against Visiting Nurse Service of New York – the largest not-for-profit home health care agency in the United States. VNSNY agreed to pay $57 million to resolve allegations it failed to provide home health care visits and services to tens of thousands of New Yorkers and fraudulently billed Medicare and Medicaid. Mr. Lacey was an executive at VNSNY for 16 years. In his complaint, Mr. Lacey alleged that VNSNY failed to provide its patients all the critical nursing and therapy visits and services their doctors prescribed under the patient Plans of Care. He contended that by failing to provide this care, VNSNY endangered the welfare of tens of thousands of its patients while maximizing the company's Medicare and Medicaid reimbursement. Mr. Lacey's claims concerning alleged Plan of Care failures impact the entire home health care industry. This is the first reported False Claims Act settlement involving allegations of a home health agency failing to follow patient Plans of Care. It also is the largest non-kickback False Claims Act settlement ever against a home health care company and the second largest settlement of any home health care fraud case. Read more: Press Release; Whistleblower Insider.

Tagged in: FCA Federal, Healthcare Fraud, Home Health and Hospice, Lack of Medical Necessity, Whistleblower Case, Whistleblower Rewards,

Sharp HealthCare — Medicare Fraud/Kickbacks (undisclosed settlement amount)

Three of our whistleblower attorneys represented a whistleblower in a qui tam action under the False Claims Act against Sharp HealthCare, a regional hospital system in San Diego. Our client alleged that the Sharp Healthcare Center for Research, Sharp’s clinical-trial research arm, fraudulently billed government payers in violation of “secondary payer” rules that prohibit billing the government when other payers will pay for a patient’s care. Our whistleblower client also alleged that Sharp cultivated an illegal kickback scheme to entice prospective trial sponsors to host clinical trials at Sharp by regularly undervaluing Sharp’s costs involved in managing clinical trials. By offering below-market value incentives and billing government and commercial insurers for injuries, the lawsuit alleged that Sharp sought to increase its attractiveness to trial sponsors. Sharp’s alleged purpose was to burnish the organization’s reputation and offer a lucrative stream of income for Sharp-affiliated physicians involved in clinical trials. Sharp settled the whistleblower’s case for an undisclosed amount. Read more here.

Tagged in: Anti-Kickback and Stark, FCA Federal, FCA State, Healthcare Fraud, Hospital Fraud, Medicaid, Medical Billing Fraud, Medical Devices and DME, Medicare, Other Government Health Programs, Pharma Fraud, Private Insurance Whistleblower Reward Programs, Provider Fraud, Whistleblower Rewards,

Skyline Urology — Healthcare Fraud ($2.1M)

Constantine Cannon represented a whistleblower in a qui tam lawsuit that alleged that from 2013 through 2016 a large urology practice had fraudulently and systematically misused a billing code in order to increase reimbursements from insurers, including Medicare and private insurers in California. The code, modifier 25, is properly used when a physician performs an evaluation and management service and a separate and distinct service on the same day. Billing with modifier 25 when no distinct service occurred can improperly inflate reimbursement rates and is known as “unbundling fraud.” The Federal Government recovered $1.85M and the State of California recovered $250,000 to resolve the allegations. For his efforts in uncovering the fraud, the whistleblower received a portion of both recoveries. See The National Law Review and Becker’s ASC Review for more.

Tagged in: Bundling and Unbundling, FCA Federal, Healthcare Fraud, Medical Billing Fraud, Private Insurance Whistleblower Reward Programs, Provider Fraud, Whistleblower Case, Whistleblower Rewards,

Freedom Health, Optimum Healthcare - Medicare Risk Adjustment ($32.5 million)

Two of our whistleblower lawyers led the representation of the late Dr. Darren Sewell, M.D., the former chief medical officer and vice president of special projects for two large health insurers and operators of Medicare managed healthcare insurance plans based in Tampa, Florida. Dr. Sewell brought a qui tam case under the False Claims Act against Freedom, Optimum and Mr. Pagidipati alleging that they improperly gamed a feature of the Medicare Advantage program known as risk adjustment, or risk scoring, by fraudulently inflating their members’ risk scores and the corresponding risk adjustment payments they received from CMS, and that they fraudulently induced CMS to allow them to expand their health insurance offerings into new counties in Florida and the Carolinas by falsely representing that they had a sufficient network of doctors, clinics and hospitals available to serve their enrollees in the expanded service areas when they had no such networks in place. The Government joined the case and in 2017, defendants agreed to pay $32.5 million to settle the matter. The Government and the whistleblower are in the process of negotiating the amount of the relator’s share of the Government’s $32.5 million recovery that Dr. Sewell’s estate will receive. See NPR, DOJ for more.

Tagged in: FCA Federal, Healthcare Fraud, Managed Care, Medicare, Risk Adjustment Fraud, Whistleblower Rewards,

UnitedHealth Group, Inc. – Medicare Advantage Risk Adjustment Fraud (Case Intervention)

Constantine Cannon represents the whistleblower in one of the largest Medicare Advantage risk adjustment cases in history. Our client, Benjamin Poehling, alleges that UHG, the nation’s largest health insurer, together with its related Medicare Advantage Organizations, knowingly inflated Medicare Advantage risk scores by engaging in “one-way” chart reviews, even after he expressed concern about this practice to fellow executives. The United States filed a complaint in intervention in May, 2017, and the case continues to be actively litigated, with trial scheduled in 2023. See: Government Complaint in Intervention; Poehling Second Amended Complaint; Constantine Cannon Press Release.

Tagged in: FCA Federal, Healthcare Fraud, Managed Care, Risk Adjustment Fraud, Whistleblower Case, Whistleblower Rewards,

Bay Sleep Clinic – Medicare Fraud/Unapproved Facilities, Unlicensed Technicians, and Physician Kickbacks ($2.6M).

Constantine Cannon represented whistleblower Elma Dresser, a sleep technician and former Bay Sleep employee. Ms. Dresser alleged that Bay Sleep Clinic and associated businesses, a network of sleep clinics in the San Francisco Bay Area, fraudulently billed Medicare for sleep studies conducted by unlicensed technicians in unapproved locations; improperly dispensed durable medical equipment from unapproved locations using unlicensed technicians; and paid doctors for referrals in violation of the federal Anti-Kickback Statute. The government joined a portion of the case, and in 2016, defendants agreed to pay $2.6 million to settle the matter. For her significant contributions, the relator’s share award was almost 21% of the government’s recovery. See DOJ for more.

Tagged in: Anti-Kickback and Stark, FCA Federal, Healthcare Fraud, Improper Medical Facility, Improper Medical Personnel, Laboratory and IDTF, Medicare, Provider Fraud, Whistleblower Rewards,

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