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DOJ Catch of the Week - Comprehensive Health Services

Posted  February 10, 2017

This week’s Department of Justice “Catch of the Week” goes to Comprehensive Health Services, Inc., one of the country’s largest providers of workforce medical services. On Wednesday, the Florida-based company agreed to pay roughly $3.8 million to settle charges it violated the False Claims Act by double-billing and mischarging the government for medical services in connection with work it performed on an Internal Revenue Service contract. See DOJ Press Release.

Comprehensive Health manages for both the government and private companies customized medical programs for large workforces. In February 2009, the company was awarded an IRS contract to provide various medical services to IRS personnel.  This included pre-placement medical examinations with electrocardiograms, vision tests and a host of other tests to be billed as part of a bundled fee.  The contract also included blood specimen collections, also to be billed as part of a bundled fee, and physical fitness examinations to be billed only if medically necessary.

According to the government, Comprehensive Health double-charged the government for vision screenings, resting electrocardiograms, and for the collection of blood specimens when those costs were already included in the bundled price for the IRS new applicant pre-placement exam. The company also allegedly charged the government for full physical exams when there was no determination of medical need and the exams were never actually performed.

In announcing the settlement, the government stressed its commitment to go after government contractors that defraud the government:

Businesses that knowingly overcharge the government should be held accountable and penalized. The settlement serves as a reminder that all government contractors need to be good stewards of taxpayer money, and those who seek to defraud the Federal government through contracts will be prosecuted to the fullest extent.

The government likewise highlighted the critical role of whistleblowers in assisting the government in its efforts to combat fraud: “Whistleblower lawsuits are a valuable tool to deter fraud and punish perpetrators.”

The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by James J. Kerr, Jr.  He will receive a whistleblower reward of roughly $645,000 from the proceeds of the government’s recovery.

Tagged in: Bundling and Unbundling, Catch of the Week,