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April 27, 2016

Michigan and 34 other states reached an agreement in principle to settle allegations against Wyeth, a subsidiary of Pfizer, Inc. The settlement will resolve allegations that Wyeth knowingly underpaid rebates owed under the Medicaid Drug Rebate Program for the sales, Protonix Oral and Protonix IV between 2001 and 2006. Both are drugs that are used to treat conditions such as acid reflux. Under the settlement Wyeth agreed to pay $784.6 million to the United States and the States. Over $371 million of this amount will go to the Medicaid Program. The settlement stems from two whistleblower lawsuits which were filed in the United States District Court for the District of Massachusetts. The United States, 35 states (including Michigan) and the District of Columbia intervened in the lawsuits. NY, NJ, MI, WA

March 9, 2016

Florida arrested a couple for defrauding the Medicaid program out of more than $180,000 in fraudulent claims. Oscar Alzate, 48, and Alba Garcia, 48, owners of Digital Radiology Center, Inc. and Medisound, Inc., allegedly operated a clinic without the appropriate licensure or proper oversight by a physician as required by Florida law. The investigation revealed that Alzate and his partner Garcia, neither who are physicians, billed the Medicaid program for services never rendered. The clinic owners also allegedly forged physicians’ signatures on medical reports and provided defective mammography services. FL

March 8, 2016

A Connecticut psychiatrist will pay $404,798 to settle a civil False Claims Act lawsuit alleging that she submitted false claims for payments to Connecticut’s Medicaid program. The state alleged that, from March 2010 to September 2013, while operating a private practice in Mansfield, Dr. Panoor submitted upcoded claims indicating that she provided Medicaid patients with both group counseling and either individual psychotherapy or a detailed examination on the same dates of service when, in fact, she did not provide psychotherapy or detailed examination sessions but instead provided medication management services or a brief meeting with the patient for the purpose of monitoring or changing a patient’s drug prescription – services that are coded, and thus reimbursed, at lower payment rates.

March 7, 2016

A Colorado-based telecommunications and Internet service provider company, Level 3 Communications, has agreed to pay more than $8 million to resolve allegations it improperly withheld rental payments to the Massachusetts Department of Transportation (“MassDOT”) under an agreement that allows it to run fiber optic cables alongside state highways. The settlement agreement resolves allegations that Level 3 Communications breached its contract with MassDOT and violated the Massachusetts False Claims Act by concealing the amount it owed the state agency and knowingly avoiding its annual rent obligations. MA

January 27, 2016

New York announced that it reached an agreement with a Capital Region transportation company, Advantage Transit Group, Inc., for repayment of Medicaid funds totaling over $1 million dollars that the company was not entitled to receive. Advantage Transit Group provides, among other services, transportation for Medicaid recipients to and from appointments and submits claims for reimbursement to Medicaid. Under the settlement agreement, Advantage Transit Group acknowledged that it submitted claims for reimbursement to Medicaid for transportation services and received payment for services that were not rendered. NY

January 12, 2016

Connecticut-based J&L Medical Services agreed to pay $600,000 to resolve allegations it violated the federal and state False Claims Acts.  J&L Medical is a durable medical equipment company that provides Continuous Positive Airway Pressure (CPAP) and Bilevel Positive Airway Pressure (BiPAP) devices and accessories to Medicare and Medicaid beneficiaries who have been diagnosed with obstructive sleep apnea.  According to the government, the company regularly used the services of unlicensed technicians to provide respiratory therapy services to Medicare and Medicaid beneficiaries, including setting up CPAP and BiPAP machines, fitting the patients with the masks used with those machines, and educating the patients about the use of the machines.  The allegations originated in a whistleblower lawsuit filed by John Hart, a former employee of J&L Medical and a licensed respiratory therapist, under the qui tam provisions of the False Claims Act.  He will receive a whistleblower award of $102,000 from the proceeds of the government’s recovery.  DOJ (CT)

January 5, 2016

Nashville Pharmacy Services, LLC, and its majority owner Kevin Hartman, agreed to pay up to $7.8 million to settle charges they violated the False Claims Act by overbilling Medicare and TennCare for pharmacy services.  Specifically, the government claimed the Nashville-based pharmacy that specializes in dispensing HIV and AIDS-related medications automatically refilled medications without a request from the beneficiary or their physician; improperly waived TennCare and Medicare co-payments without an individualized assessment of ability to pay; improperly used pharmaceutical manufacturers’ co-payment cards to pay the co-payments of Medicare beneficiaries; billed for medications dispensed after the deaths of certain beneficiaries; and billed for medications that lacked a valid prescription.  The allegations originated in a whistleblower lawsuit filed by Marsha McCullough, a former Nashville Pharmacy order entry technician, under the qui tamprovisions of the False Claims Act.  She will receive a whistleblower award of 18 percent of the government’s recovery which could amount to $1.4 million.  Whistleblower Insider

December 16, 2015

Qualitest Pharmaceuticals, the company’s corporate shell, Vintage Pharmaceuticals, its parent Endo Pharmaceuticals, and seven of their affiliates, agreed to pay $39 million to 48 states and the federal government to settle charges they violated federal and state False Claims Acts by selling understrength chewable fluoride tablets.  As part of the settlement, Qualitest admitted the drug labeling for its chewable fluoride tablets represented fluoride amounts in line with guidelines of the American Dental Association and the American Academy of Pediatrics when in reality it used less than half of these represented amounts.  The allegations were first raised in a whistleblower lawsuit brought Dr. Stephan Porter under the qui tam provisions of the False Claims Act.  He will receive a whistleblower award of roughly $4.71 million from the proceeds of the government’s recovery.  Whistleblower Insider, NY, NH

November 18, 2015

Deaconess Home Health, Inc. (formerly known as Outreach Home Health) and its owner, Lazarus Bonilla, agreed to pay $3,724,000 to resolve charges they violated the False Claims Act through the false billing of personal care worker services to the Wisconsin Medicaid Program.  Specifically, the defendants (1) intentionally recruited patients for personal care services without regards to whether the services were medically necessary; (2) instructed nurses employed by Deaconess to routinely inflate, without regard to medical necessity, the assessment of the patient that was provided to the Medicaid program; (3) failed to conduct required supervisory visits to ensure that services were in fact being provided, that services continued to be medically necessary, and that any services provided were appropriate for the needs of the patient; and (4) hired physicians to act as medical directors to sign plans of care for patients on whom they had not completed a physical examination.  The allegations first arose in three whistleblower lawsuits filed under the qui tam provisions of the False Claims Act.  Two of the whistleblowers are former employees of Deaconess.  The whistleblowers collectively will receive a whistleblower award of approximately $600,000.  (DOJ (EDWI)

November 16, 2015

Pittsburgh-based for-profit education company Education Management Corp. agreed to pay $95.5 million to resolves allegations it violated the federal False Claims Act and several state False Claims Acts by falsely certifying it was in compliance with Title IV of the Higher Education Act and parallel state statutes.  The government alleged the company violated the statute’s Incentive Compensation Ban by running a high pressure boiler room where admissions personnel were paid based purely on the number of students they enrolled.  The allegations first arose in series of whistleblower lawsuits filed under the qui tam provisions of the False Claims Act.  The whistleblowers will collectively receive a whistleblower award of $11.3 million from the proceeds of the government’s recovery.  Whistleblower Insider IN, IL, IA, MT, NJ, NY, NM, VA, WA
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