Whistleblower Rewards

October 24, 2016

Life Care Centers of America Inc., the Tennessee-based operator of more than 220 skilled nursing facilities, and its owner Forrest L. Preston, agreed to pay $145 million to resolve charges that Life Care violated the False Claims Act by submitting claims to Medicare and TRICARE for rehabilitation therapy services that were not reasonable, necessary or skilled.  It is the largest settlement with a skilled nursing facility chain in DOJ’s history.  The allegations originated in a whistleblower lawsuit filed by former Life Care employees Tammie Taylor and Glenda Martin under the qui tam provisions of the False Claims Act.  They will receive a whistleblower award of $29 million from the proceeds of the government’s recovery.  Whistleblower Insider

October 21, 2016

New York-based hematology and oncology practice Hudson Valley Associates agreed to pay $5.31 million to settle charges of violating the False Claims Act by improperly waiving patient copayments and submitting claims for services it did not provide and/or were not permitted under the Medicare and Medicaid program rules.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act.  The whistleblower will receive a yet-to-be-determined whistleblower award from the proceeds of the government's recovery.  DOJ (SDNY)

October 17, 2016

Ohio-based nursing home pharmacy Omnicare, Inc. agreed to pay roughly $28 million to resolve charges of violating the False Claims Act by soliciting and receiving kickbacks from pharmaceutical manufacturer Abbott Laboratories in exchange for promoting the prescription drug, Depakote, for nursing home patients.  The settlement follows the May 2012 settlement under which Abbott agreed to pay $1.5 billion to resolve Abbott’s liability under the False Claims Act for, among other things, alleged kickbacks to nursing home pharmacies, including Omnicare and PharMerica Corp.  In October 2015, PharMerica agreed to pay $9.25 million to settle its role in the alleged scheme.  The allegations underlying this settlement as well as the prior Abbott and PharMerica settlements originated in two whistleblower lawsuits filed by former Abbott employees Richard Spetter and Meredith McCoyd under the qui tam provisions of the False Claims Act.  Ms. McCoyd will receive a whistleblower award of $3 million from the proceeds of this settlement.  Whistleblower Insider

October 4, 2016

Arizona not-for-profit community health system Yavapai Regional Medical Center agreed to pay $5.85 million to resolve claims that it violated the False Claims Act by misreporting data about the hours worked by its employees on its annual cost reports, which improperly inflated the amount of money it received from the Medicare program.  According to the government, the artificially inflated wage index was used by the Medicare program when it calculated the amount of the payments it made to Yavapai.  The allegations originated in a whistleblower lawsuit filed by Gregory Kuzma under the qui tam provisions of the False Claims Act.  Mr. Kuzma will receive a whistleblower award of $1.17 million from the proceeds of the government's recovery.  DOJ (DAZ)

October 3, 2016

Major hospital chain Tenet Healthcare Corporation and two of its Atlanta-area subsidiaries, Atlanta Medical Center Inc. and North Fulton Medical Center Inc., agreed to pay over $513 million to resolve charges they violated the False Claims Act and Anti-Kickback statute through illegal kickbacks it paid in exchange for patient referrals.  The allegations originated in a whistleblower lawsuit filed by Ralph Williams under the qui tam provisions of the federal and Georgia False Claims Acts.  Mr. Williams will receive a whistleblower award of approximately $84 million from the proceeds of the federal and state civil recoveries.  DOJ

October 3, 2016

California orthopedic clinics Orthopedic Associates of Northern California, San Bernardino Medical Orthopaedic Group Inc. (doing business as Arrowhead Orthopaedics) and Reno Orthopaedic Clinic agreed to pay a combined $2.39 million to resolve federal and state False Claims Act allegations that they improperly billed federal and state health care programs for reimported osteoarthritis medications, known as viscosupplements.  According to the government, the clinics purchased deeply discounted viscosupplements that were reimported from foreign countries and billed them to state and federal health care programs in order to profit from the reimbursement system, when such reimported viscosupplements were not reimbursable by those programs.  The reimported products allegedly included labeling in foreign languages and in English for additional uses not approved in the United States.  The government further alleged there was no manufacturer assurance that the drugs had not been tampered with or that it was stored appropriately.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by a Senior Musculoskeletal Specialty Manager in the Biosurgery Division of Sanofi S.A.  The whistleblower will receive a whistleblower award of approximately $430,000 from the proceeds of the government's recovery.  DOJ (EDCA)

September 30, 2016

Daniel Scott Goldman and his companies, Ecologic Industries LLC and OMNI SCM LLC, agreed to pay $1,525,000 to settle charges of violating the False Claims Act by making false statements to avoid paying duties on wooden bedroom furniture imported from China.  According to the government, the defendants misclassified or conspired with others to misclassify wooden bedroom furniture on documents presented to U.S. Customs and Border Protection to avoid paying antidumping duties on Chinese imports of wooden bedroom furniture.  Specifically, Goldman and his companies allegedly classified the furniture as office and other types of furniture not subject to duties while selling the furniture in the student housing market for use in dormitory bedrooms.  The allegations originated in a whistleblower lawsuit filed by Matthew L. Bissanti, Jr. under the qui tam provisions of the False Claims Act.  Bissanti will receive a whistleblower award of $228,750 from the proceeds of the government's recovery.  DOJ (WDTX)

September 28, 2016

Pennsylvania-based hospital chain Vibra Healthcare LLC agreed to $32.7 million to resolve claims it violated the False Claims Act by billing Medicare for medically unnecessary services.  According to the government, Vibra admitted numerous patients to five of its long term care hospitals and one of its inpatient rehab facilities who did not demonstrate signs or symptoms that would qualify them for admission.  In addition, Vibra allegedly extended the stays of its long term care patients without regard to medical necessity, qualification and/or quality of care.  In some instances, Vibra allegedly ignored the recommendations of its own clinicians, who deemed these patients ready for discharge.  The allegations originated in a whistleblower lawsuit filed by Sylvia Daniel, a former health information coder at Vibra Hospital of Southeastern Michigan, under the qui tam provisions of the False Claims Act.  She will receive a whistleblower award of at least $4 million from the proceeds of the government's recovery.  Whistleblower Insider

Bay Sleep Clinic - Healthcare Fraud/Kickbacks ($2.6 million)

Constantine Cannon represented a whistleblower under the False Claims Act case alleging Bay Sleep Clinic billed Medicare for sleep studies by unlicensed technicians and paid kickbacks to doctors for patient referrals.  In December 2016, the company agreed to pay $2.6 million to settle the matter.  Our client received a whistleblower award of roughly 21% of the government’s recovery.  Read more -- SF Gate, DOJ, PR Newswire, CC.