September 25, 2021

Volume XI, Number 268

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Summer of Medical Fraud: Four Cases Across the US Where Unnecessary Tests, Services, or Prescriptions were Given to Patients and Fraudulently Billed to the Government

July 29, 2021.  The United States Department of Justice this month settled four cases involving health care fraud for a total of $6 million.  Whistleblowers received $504,000 for reporting fraud.

An Ocala, Florida-based neurologist settled with the government regarding allegations that the physician improperly prescribed Acthar Gel® to patients, costing Medicare $35,000 for each prescription.  Whistleblowers reported this egregious situation and received $144,000 of the government’s $800,000 recovery.

Billings, Montana-based rheumatologist settled allegations of overbilling and unnecessary claims sent to Medicare for $2 million.  Between January 2015 and September 2018, the rheumatologist and his business allegedly ordered medically unnecessary biologic infusions and MRIs and improperly billed for patient visits for people who had did not have seronegative rheumatoid arthritis.

Lexington, Kentucky-based toxicology lab settled for $1.2 million regarding allegations about submitting claims for urine drug tests with an inflated number of drug classes tested to Medicare, Kentucky and Indiana Medicaid programs, TRICARE, and CHAMPVA.  The lab also allegedly submitted claims with insufficient documentation of the treating physician’s intent to order tests.  Despite guidance since January 14, the lab additionally allegedly submitted claims to Medicare for specimen validity testing, which should not be separately billed to Medicare.  The lab self-disclosed its misconduct.

An Orange County, California-headquartered rehabilitation facility allegedly billed Medicare for medically unreasonable and unnecessary rehabilitation therapy services rendered between 2006 and 2014.  Vulnerable elderly patients at 11 Skilled Nursing Facilities were inappropriately diagnosed as needing “Ultra High” levels of physical, occupational, and/or speech therapy, for which the facilities then billed Medicare.  A former director of the facility blew the whistle on this activity and will receive $360,000 of the $2 million settlement as part of the qui tam or whistleblower provisions of the False Claims Act.

As this Friday is National Whistleblower Day, it is important to highlight the role ordinary citizens and employees of companies can have in reporting fraud.  Medicare and other government-funded healthcare programs exist to serve vulnerable populations as part of the social contract that is health insurance.  Providers should not see these programs as a means to enrich themselves at either their patients’ or taxpayers’ expense.  The qui tam provisions of the False Claims Act encourage and potentially reward whistleblowers for suing on behalf of the United States.

© 2021 by Tycko & Zavareei LLPNational Law Review, Volume XI, Number 210
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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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