October 16, 2021

Volume XI, Number 289

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October 15, 2021

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October 14, 2021

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“Free” Costs Taxpayers: Mail-Order Diabetic Testing Company Settles for $160 Million

August 10, 2021.  The United States Department of Justice settled a False Claims Act case against one of the nation’s largest Medicare mail-order diabetic testing suppliers and its parent company for $160 million.  A whistleblower, who was a call center employee, brought the supplier’s alleged wrongdoing to light.  The whistleblower is receiving $28,548,749 as their share of the recovery.

According to the allegations, Arriva Medical LLC (Arriva) and its parent company, Alere Inc. (Alere) paid kickbacks to Medicare beneficiaries, billed Medicare for patients who were ineligible to receive glucose meters, or billed Medicare for services for deceased patients. Over approximately six years, the testing supplier allegedly induced Medicare beneficiaries to choose their company’s glucometers and supplies by promising patients “free” or “no cost” diabetes testing materials. For services which Medicare beneficiaries would normally owe copayments, the supplier allegedly “routinely waived, and failed to make reasonable efforts to collect” copayments, effectively making the glucometers and test strips “free” to patients. Under Medicare rules, eligible patients can get a new glucometer once every five years. The supplier allegedly provided patients and subsequently billed Medicare for meters more often than patients were eligible. Additionally, the supplier allegedly submitted false claims to Medicare for glucometers for every new patient, regardless of medical need. The supplier finally lost its Medicare supplier number in 2016 when it was caught submitting false claims to Medicare on behalf of deceased beneficiaries.

In providing health insurance services, Medicare serves as part of the social safety net for the elderly and other vulnerable populations. Providers, suppliers, and healthcare systems submitting false claims to Medicare violate the intention of the program, defraud taxpayers, and divert funds away from those in need. A whistleblower reported their employer to the government, courageously identifying wrongdoing, which harms not only improperly-billed and -treated patients, but also taxpayers funding Medicare. The Department of Justice needs whistleblowers to report Medicare fraud and stop those who seek to make a mockery of this healthcare system.

© 2021 by Tycko & Zavareei LLPNational Law Review, Volume XI, Number 222
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About this Author

Jonathan K. Tycko leads the Whistleblower Practice Group of Tycko & Zavareei LLP

In recent years, the laws of the United States have undergone a whistleblower revolution. Federal and state governments now offer substantial monetary awards to individuals who come forward with information about fraud on government programs, tax fraud, securities fraud, and fraud involving the banking industry. Whistleblowers also now have important legal protections, designed to prevent retaliation and blacklisting.

The law firm of Tycko & Zavareei LLP works on the cutting edge of this whistleblower revolution, taking on even the most complex and confidential whistleblower...

202-973-0900
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