Health

A settlement has been reached in a whistleblower class action lawsuit brought against Pediatric Services of America Healthcare, Pediatric Services of America, Inc., Pediatric Healthcare, Inc., Pediatric Home Nursing Services (collectively, “PSA”), and Portfolio Logic, LLC. They are accused of failing to disclose and return overpayments that it received from federal health care programs and submitting false claims to federal health care programs.

The whistleblowers will receive a $1,121,729 share of the recovery.

The case, filed in 2011, alleged that PSA knowingly (1) failed to disclose and return overpayments that it received from federal health care programs such as Medicare and Medicaid, (2) submitted claims under the Georgia Pediatric Program for home nursing care without documenting the requisite monthly supervisory visits by a registered nurse, and (3) submitted claims to federal health care programs that overstated the length of time their staff had provided services, which resulted in PSA being overpaid.

A settlement has been reached in a whistleblower class action lawsuit brought against Abbott Laboratories Inc., B. Braun Medical Inc. and Roxane Laboratories Inc. n/k/a Boehringer Ingelheim Roxane Inc. They are accused of that engaging in a scheme to report false and inflated prices for numerous pharmaceutical products.

The whistleblowers will receive approximately $88.4 million.

This whistleblower case stemmed from numerous cases filed against these pharmaceutical companies, one case goes all the way back to 1997.  The United States allged that Abbott, Roxane and Braun created artificially inflated spreads to market, promote and sell the drugs to existing and potential customers.  Because payment from the Medicare and Medicaid programs was based on the false inflated prices, the government alleged that the defendants caused false claims to be submitted to federal healthcare programs, and as a result, the government paid millions of claims for far greater amounts than it would have if Abbott, B. Braun and Roxane had reported truthful prices. 

The difference between the resulting inflated government payments and the actual price paid by healthcare providers for a drug is referred to as the “spread.”  The larger the spread on a drug, the larger the profit for the health care provider or pharmacist who gets reimbursed by the government.

A settlement has been reached in a whistleblower class action lawsuit brought against Dey Inc, Dey Pharma LP (formerly known as Dey, LP) and Dey LP Inc.  They are accused of  engaging in a scheme to report false and inflated prices for numerous pharmaceutical products.

The whistleblowers will receive a share of approximately $67.2 million.

The initial whistleblower complaint against Dey Inc was filed in the Southern District of Florida on August 13, 1997. Eventually the United States interevened in August 2006.  The United States alleged that Dey reported false prices for the following drugs: Albuterol Sulfate, Albuterol MDI, Cromolyn Sodium and Ipratropium Bromide. The difference between the resulting inflated government payments and the actual price paid by health care providers for a drug is referred to as the “spread.”  The larger the spread on a drug, the larger the profit for the health care provider or pharmacist who is reimbursed by the government.  The government alleges that Dey created artificially inflated spreads to market, promote and sell the drugs to existing and potential customers.  Because payment from the Medicare and Medicaid programs was based on the false inflated prices, the government alleged that Dey caused false and fraudulent claims to be submitted to federal health care programs and, as a result, the government paid millions of claims for far greater amounts than it would have if Dey had reported truthful prices.

A settlement has been reached in a whistleblower class action lawsuit brought against St. Joseph Medical Center (SJMC) in Towson, MD who is accused of paing unlawful remuneration in a series of professional services contracts with MidAtlantic Cardiovascular Associates (MACVA).

The whistleblowers recovery amounts were not disclosed.

The original lawsuit was filed in June 2010 and it alleged that SJMC paid kickbacks to MidAtlantic under the guise of professional services agreements, in return for MACVA’s referrals to the medical center of lucrative cardiovascular procedures, including cardiac surgery and interventional cardiology procedures, over the period from Jan. 1, 1996, to Jan. 1, 2006. The settlement agreement resolves issues relating to 11 professional services agreements between MidAtlantic and St. Joseph under which MACVA received payments above fair market value, for services not rendered or that were not commercially reasonable and were entered into for the purpose of inducing referrals by MACVA to SJMC.

Under the settlement the hospital also agrees to settle allegations that it received from federal health benefit programs between Jan. 1, 2008, and May 12, 2009, for medically unnecessary stents performed by Mark Midei, M.D., a one time partner in MACVA who was later employed by SJMC.

A settlement has been reached to resolve False Claims Act Allegations against Dr. Walter Janke, his wife, Lalita Janke, and Vero Beach, Fla.-based Medical Resources L.L.C. (MR).  They are accused of submitting false diagnosis codes to Medicare.

The Jankes were the owners of America’s Health Choice Medical Plans Inc. (AHC), a Medicare Advantage Organization (MAO), approved by the federal health care program to provide health care to enrolled Medicare beneficiaries. The Jankes also owned MR, AHC’s primary care provider. AHC and MR are no longer doing business.

The United States allged that the Jankes and MR violated the False Claims Act by causing AHC to falsely increase the severity of beneficiary diagnoses to obtain higher Medicare payments. Under the Medicare Advantage Program, MAO's are paid more to provide services for members with serious and/or chronic medical conditions then they are for relatively healthy members.

In addition to suing the Jankes and MR, the United States successfully petitioned the court to freeze approximately $20 million of the Janke's assets believed to be the proceeds of their unlawful scheme. A portion of the Janke’s frozen assets, along with monies resulting from the dissolution of AHC now held in receivership by the Florida Department of Financial Services, will be used to pay the settlement.

A settlement has been reached in a whistleblower class action lawsuit brought against El Centro Regional Medical Center who is accused of defrauding Medicare.

The whistleblower will receive $375,000.

The original lawsuit was filed in May 2006. The United States alleged that the 165-bed acute care hospital fraudulently inflated its charges to Medicare patients to obtain larger reimbursements from the federal health care program. The settlement covers claims submitted by the hospital for short inpatient admissions, usually of one day or less, when the services should have been billed on an outpatient “observation” basis or as emergency room visits.

A settlement has been reached in a whistleblower class action lawsuit brought against St. Jude Medical Inc, Parma Community General Hospital, and Norton Healthcare. They are accused of violating the False Claims Act in relation to certain illegal kickbacks to secure heart-device business.

Under the terms of the settlement, St. Jude, headquartered in St. Paul, Minn., will pay $3,725,000. Parma Community General Hospital, located in Parma, Ohio, will pay $40,000, and Norton Healthcare in Louisville, Ky., will pay $133,300. The government asserted that Parma and Norton were recipients of improper rebates from St. Jude.  The reward for the whistleblower will be $640,050.

The whistleblower case was originally filed in 2006. The United States alleged that St. Jude paid illegal kickbacks to two hospitals to secure heart-device business and that these kickbacks caused false claims to be submitted to federal health care programs in violation of the False Claims Act. The kickbacks included alleged rebates that were "retroactive" and paid based on a hospital’s previous purchases of St. Jude heart-device equipment and rebates that St. Jude paid for purchases of heart-device equipment sold by its competitors to induce purchases of similar equipment from St. Jude in the future.

A settlement has been reached in a whistleblower class action lawsuit brought against Metropolitan Ambulance & First Aid Corp, Metro North Ambulance Corp, Big Apple Ambulance Service Inc, including their president, Steve Zakheim. They are accused of falsifying records to appeal a Medicare program refund demand.

The whistleblower will receive $618,450.

The original whistleblower case was filed in 2000.  The United States alleged that the companies and Zakheim used, or caused the use of, falsified records to appeal a Medicare program refund demand. Medicare had demanded the companies return millions of dollars they had been paid for medically unnecessary ambulance trips. Under Medicare rules, the companies could bill for these expensive non-emergency transports only if the patient could not be transported by any other means, such as by car or by wheelchair van. Medicare audited the companies’ past billings and concluded that the companies had charged Medicare tens of millions of dollars for ambulance trips that did not meet this standard. Medicare demanded a refund and afforded the companies an extensive informal and formal appeals process to prove that their billings were proper.

The government contended that, rather than contesting the refund demand fairly, the companies resorted to fraud when they could not otherwise prove an ambulance was medically needed. According to the suit, in their ensuing appeals, the companies used, and Zakheim caused the use of, hundreds of letters attesting to the need for an ambulance that were forged or otherwise purported to come from some neutral, disinterested health care provider when they in fact did not.

A settlement has been reached in a whistleblower class action lawsuit brought against Novartis Vaccines & Diagnostics Inc and Novartis Pharmaceuticals Corporation. They are accused of causing false claims to be submitted to federal health care programs.

According to the settlement, the United States will receive $43.5 million to resolve the federal claims, and the states will receive $29 million to settle their respective claims. The whistleblowers will receive $7.825 million of the federal share of the settlement announced today.

The original lawsuit was filed in October 2006.  The United States alleged that, between Jan. 1, 2001 and July 31, 2006, Novartis and its predecessor, Chiron Corporation, caused false claims to be submitted to federal health care programs for certain off-label uses of the cystic fibrosis drug TOBI.

The Food and Drug Administration (FDA) approved TOBI, an inhaled antibiotic, for the treatment of certain cystic fibrosis patients. The United States alleges that Chiron, and then Novartis, marketed TOBI for unapproved uses, such as diseases other than cystic fibrosis, and for cystic fibrosis patients who did not meet the parameters of the FDA-approved indication and for which TOBI was not a medically accepted use. The government alleges that this conduct caused the submission of false claims to federal health care programs.

A settlement has been reached in a whistleblower class action lawsuit brought against nine hospitals located in Alabama, Indiana, Florida, Michigan, South Carolina, New York and Minnesota. They are accused of submitting false claims to Medicare.

The settling facilities and the amount being paid by each to the United States are Ball Memorial Hospital, Muncie, Ind. ($1,995,431); Bethesda Memorial Hospital, Boynton Beach, Fla. ($356,079); Bloomington Hospital, Bloomington, Ind. ($1,443,848); Genesys Regional Medical Center, Grand Blanc, Mich. ($931,742); Huntsville Hospital, dba The Health Care Authority of the City of Huntsville, Huntsville, Ala. ($1,992,756); Palmetto Health dba Palmetto Health Baptist Hospital, Columbia, S.C. ($1,861,083.14); St. Elizabeth Medical Center, Utica, N.Y. ($195,976); St. Mary’s of Michigan Hospital, Saginaw, Mich. ($260,065.21); and United Hospital, St. Paul, Minn. ($428,656).  The whistleblowers will receive approximately $1.5 million as their share of the settlement proceeds.

The original whistleblower case was filed against multiple facilities and filed in 2008.  The United States specifically alleged that these nine hospitals overcharged Medicare between 2000 and 2008 when performing kyphoplasty, a minimally-invasive procedure used to treat certain spinal fractures that often are due to osteoporosis. In many cases, the procedure can be performed safely as a less costly out-patient procedure, but the government contends that the hospitals performed the procedure on an in-patient basis in order to increase their Medicare billings. 

The settlement with these facilities follows the settlements that the government reached in May and September 2009 with nine other hospitals for alleged kyphoplasty-related Medicare fraud claims, as well as the government’s May 2008 settlement with Medtronic Spine LLC, corporate successor to Kyphon Inc. Medtronic Spine paid $75 million to settle allegations that the company defrauded Medicare by counseling hospital providers to perform kyphoplasty procedures as an in-patient procedure, even though in many cases the minimally-invasive procedure should have been done on an out-patient basis.