A settlement has been reached in a whistleblower class action lawsuit brought against Orthofix Inc who is accused of improperly waiving patient co-payments and paying kickbacks to physicians.
The whistleblower will receive a $9,243,251 share of the civil settlement amount.
The government's complaint stemmed from a whistleblower lawsuit that was filed in March 2005. The United States alleged that Orthofix improperly waived patient co-payments, thus misstating their true cost and resulting in overpayments by federal programs; paid kickbacks to physicians and their staffs in the form of “fitter fees,” referral fees and other comparable fees, to induce the use of Orthofix products; caused the submission of falsified certificates of medical necessity; and failed to advise patients of their right to rent rather than purchase Orthofix products.
The company has also agreed to plead guilty to a felony of obstruction of a federal audit, and to pay a $7,765,737 criminal fine. The company’s criminal guilty plea involved its failure to disclose information concerning its practices regarding certificates of medical necessity to a Medicare contractor during a June 2008 audit. Five individual Orthofix employees had previously pleaded guilty to criminal charges in connection with this matter.
