Tuesday, August 30, 2005

Michigan considers a Medicaid False Claims Act

Michigan lawmakers are considering a bill that would reward people who successfully sue health care providers for Medicaid fraud. The legislation is similar to whistleblower laws in other states and is receiving strong support from Michigan Attorney General Mike Cox. State False Claims Acts are credited with increasing recoveries from defrauders by a factor of three - or even four.

The Detroit News ran an August 28, 2005 story on the proposed legislation.

Whistleblower suit against Caremark expands

The Medicaid fraud suit against Caremark, one of the nation's largest pharmacy benefit managers, could have damages in excess of $500 million, according to a newly expanded whistleblower suit.

Five states have joined with the federal government in an effort to recover money from Caremark, and others are considering joining.

The False Claims Act suit alleges that Caremark defrauded Medicaid by improperly rejecting claims from Medicaid, the Indian Health Service, the Veterans Administration and other government programs.

The Street.com's August 29, 2005 described developments.

Friday, August 26, 2005

California sues drug makers on behalf of Medi-Cal

California Attorney General Bill Lockyer filed suit against 39 pharmaceutical companies, alleging they manipulated prices to artificially increase the reimbursement rate paid by the state's Medicad program, called Medi-Cal.

The case will be consolidated with those filed by other states in federal court in Boston. The central claim is that drugmakers have manipulated the average wholesale price of a new drug, setting it higher than it should be to maximize profit. In one example, Lockyer showed reporters a drug that pharmacies purchased $2.82 but were reimbursed $31.83 from Medi-Cal.

The San Francisco Chronicle reported on the lawsuit on August 26, 2005.

Monday, August 22, 2005

University of Illinois to pay $2.5 million in settlement of whistle-blower lawsuits

The University of Illinois has agreed to pay $2.5 million to settle lawsuits brought by a whistle-blower who accused the university of fraud in its transplant program. The whistle-blower is the former chief of transplant surgery at the medical center. He accused the facility of improperly diagnosing some patients to make them eligible for transplants.

The university previously paid $2.5 million to federal and state authorities in settlement of the fraud allegations.

The AP story ran in the August 23, 2005 issue of the Chicago Flame.

Florida imaging centers accused of defrauding Medicare

University MRI, a chain of medical imaging centers in Boca Raton, have been accused in a whistleblower lawsuit of defrauding Medicare. United States agents, investigating charges that the chain overbilled Medicare and illegally paid doctors to refer patients, searched the firm's offices.

MRI and CT scans can cost up to $2500. A doctors' association estimates that Medicare and insurers pay as much as $16 billion a year for unnecessary tests ordered by doctors who make money from them.

See the August 19, 2005 issue of the Sun-Sentinal for more details.

Monday, August 15, 2005

Visiting Physicians face Medicare inquiry

The nation's largest physician house-call group is being investigated by federal authorities in Ohio on suspician of defrauding Medicare.

A criminal inquiry is proceeding and federal prosecutors have moved to shut down a private whistleblower lawsuit that also alleges Medicare fraud. The prosecutors claim that the whistleblower suit could interfere with their criminal investigation.

The whistleblower suit, brought under the qui tam provisions of the federal false Claims Act, accuses the company of "upcoding" in order to inflate reimbursement amounts.

The Cleveland Plain Dealer reported on developments in its August 13, 2005 issue.

Friday, August 12, 2005

Mass. AG investigates allegations of substandard Big Dig concrete

Federal and Massachusetts prosecutors are investigating allegations that Aggregate Industries, the largest supplier of concrete to the Big Dig, delivered substandard concrete to the $14.6 billion project. Investigators have turned up evidence that the company had drawn up phony documents to make it appear that truckloads of old or rejected concrete were freshly poured.

The state attorney general is working with the FBI and the Boston US Attorney's Office to prosecute the case.

The Boston Globe ran an August 11, 2005 story on developments.

Wednesday, August 10, 2005

Mount Vernon Hospital to pay $2.65 million in settlement of fraud claims

Mount Vernon Hospital, of Westchester County, New York, will pay $2.65 million to settle charges that it participated in an illegal Medicaid referral scheme involving kickbacks for patients who sought substance abuse services.

The suit, originally brought by a whistle-blower, charged that the hospital paid a consulting company, Applied CaseManagement Inc., $60,000 a month for patient referrals, something that violates state and federal laws. The payments were allegedly mischaracterized as administrative services. The suit also claimed that the hospital was not certified to provide inpatient alcoholism services, making any claims to Medicaid for those services false.

The Journal News ran a story on the settlement on August 2, 2005.

Tuesday, August 09, 2005

Homecare company agrees to settlement of qui tam lawsuit

Apria Healthcare has reached a preliminary agreement for the settlement of two lawsuits involving allegations of incomplete or inaccurate documentation in Medicare billings. The lawsuits were originally brought by a private whistleblower acting under the qui tam provisions of the Federal False Claims Act. Apria will pay the government $17.6 million without admitting wrongdoing.

News of the settlement appeared at PrimeZone on August 9, 2005.

Thursday, August 04, 2005

Harvard defendants settle False Claims Act suit

Harvard University and two senior advisors have agreed to pay over $31 million to settle allegations of defrauding the U.S. Agency for International Development. The advosors were paid under a USAID grant to advise Russia on economic development. In violation of their agreement, they made investments in Russia in areas where they were providing advice.

The August 3, 2005 press release on the settlement can be found at the U.S. Newswire website.