FCA State

June 29, 2015

New York announced a settlement with pharmacy Trinity Homecare LLC that returns $2.5 million to the state’s Medicaid program. A whistleblower filed a lawsuit in 2009 alleging that Trinity pushed infusion drugs, which are prescribed to manage symptoms, to hemophilia patients and presented claims to Medicaid for unneeded or excessive quantity of these drugs. The whistleblower alleged improper billing for drug deliveries, including ones that patients refused to accept and excess shipments. In at least one instance, these expensive drugs were allegedly left outside a patient’s home without signature by the patient. NY

June 18, 2015

47 states and the District of Columbia reached a settlement with Inspire Pharmaceuticals, resolving allegations that Inspire violated state and federal False Claims Act laws by illegally marketing the drug Azasite for off-label uses not approved by the U.S. Food and Drug Administration. Approved only for the treatment of bacterial conjunctivitis (“pink eye”), Inspire marketed Azasite for the treatment of blepharitis, an inflammation of the eyelash follicles. While physicians are permitted to prescribe drugs for conditions other than those for which the drugs have been approved by the FDA, pharmaceutical companies are prohibited from marketing drugs to physicians for such off label conditions. It is contended that, as a result of Inspire’s illegal off label promotion, Inspire caused the submission of false and fraudulent claims for Azasite to the Medicaid program and other federal programs. NY

June 18, 2015

Connecticut commenced a case under that state’s False Claims Act against the co-owners of a psychiatric clinic alleged to have submitted false claims to the state’s Medicaid program, Connecticut Medical Assistance Program (CMAP), from January 2010 through December 2014. According to the complaint, the defendants illegally submitted false claims for reimbursement while knowingly retaining and concealing the overpayment. The psychiatrist is alleged to have engaged in a systemic practice of knowingly “upcoding” the claims for reimbursement she submitted to the CMAP. For example, as the complaint alleges, she routinely double, triple, and in some cases quadruple-booked appointments for her Medicaid patients, then submitted CMAP using a reimbursement code, which required her to see the patient for approximately 75 to 80 minutes when, in fact, she saw each patient for as little as 5-10 minutes. The state’s complaint identifies 113 days where the psychaitrist billed the CMAP for more than 24 hours of service. Both defendants are also alleged to have attempted to conceal from state auditors the existence of databases that contained information which would have established evidence that the claims were false. CT

June 11, 2015

Louisiana announced that its Medicaid program will receive over $5 million as a result of a settlement between specialty pharmacy company Accredo Health Group, Inc. and 40 states and the federal government, resolving allegations that Accredo engaged in a scheme with drugmaker Novartis to boost sales of the drug Exjade, which is used to treat chronic iron overload due to blood transfusions. Accredo is accused of improperly directing nurses to contact Medicaid beneficiaries to encourage continued use of Exjade. Accredo’s goal in the scheme was to earn higher sales revenue, additional dispensing fees and more rebates from Novartis. The nurses were directed to discuss Exjade’s common side effects, but not its less common but more severe possible side effects such as kidney or liver problems. LA

May 8, 2015

New York Attorney General Eric T. Schneiderman announced an agreement in principle to settle kickback claims against Medco Health Solutions subsidiary Accredo Health Group, Inc. to resolve allegations that Accredo recommended the drug Exjade to Medicaid patients in exchange for kickbacks from Novartis Pharmaceuticals Corporation which markets the drug. Under the settlement, Accredo will pay $60 million to the federal government, New York, and several other states. About $3.4 million of the settlement will resolve claims relating to New York’s Medicaid program. In January 2014, another pharmacy, BioScrip, Inc., agreed to pay $15 million to resolve similar claims. The case against Novartis is ongoing. NY

April 28, 2015

Life Focus Center of Charlestown, Inc., a former nonprofit that provided day habilitation services to individuals with developmental disabilities, agreed to pay more than $94,000 to settle claims it violated the Massachusetts False Claims Act by billing the state’s Medicaid program (MassHealth) for services not provided. MA

April 23, 2015

Grady Health System agreed to pay $2,950,000 to settle claims it inaccurately coded claims for neo-natal intensive care unit patients, resulting in alleged damages to the Georgia Medicaid program. GA

April 13, 2015

Hallmark Health Systems agreed to pay $1.75 million to settle allegations it improperly billed the Massachusetts Medicaid Program (MassHealth) for certain inpatient admissions at its hospitals, resulting in overpayments by MassHealth. The settlement alleges that from March 2008 to December 2013, Hallmark used a specific default code that classified MassHealth patients as having received short-stay inpatient services, when an observation or outpatient level of care would have been more appropriate. MA