Thursday, June 29, 2006

Highmark Insurance settles qui tam suit

Highmark, Inc., a Pennsylvania insurance company, has entered into an agreement with the federal government to resolve allegations that it underpaid amounts due for care of certain Medicare beneficiaries. Medicare is a secondary payer for its beneficiaries who have other coverage under employer group health plans. The group health plans, in these cases ones administered by Highmark, are responsible for primary payment.

According to the terms of the settlement, announced June 19, 2006 by the U.S. Attorney's Office for the Eastern District of Pennsylvania, Highmark will pay $2.5 million and enter into a "model Medicare secondary payer" program.

The suit originated in a qui tam, complaint filed by a former Highmark employee who will receive $818,632 as her relator's share.

Clinic and manufacturer pay $345,000 in kickback case

Stryker Corp., an artificial joint manufacturer, and the Center for Neurosciences, Orthopedics & Spine have agreed to pay $345,000 to the Medicare Trust Fund to settle a federal kickback case., the U.S. Attorney's Office for the District of South Dakota announced.

The corporation made payments to the Center in order to induce it and its surgery center to buy Stryker products. The federal Anti-Kickback Act prohibits the payments from one entity to another for the purpose of inducing the purchase of goods or services.

A former physician and board member of the center brought the suit under the qui tam provisions of the False Claims Act.

The Sioux City Journal reported on the settlement on June 24, 2006.

Tenet will pay $900 million to settle FCA charges

The U.S. Dept. of Justice has announced that Tenet Healthcare Corporation has agreed to pay more that $900 million to settle allegations of unlawful billing practices.

The settlement is the second-largest ever paid by a for- profit hospital company. It ends a 2003 lawsuit alleging the company cheated Medicare, the U.S. insurance plan for the elderly and disabled, for six years in the 1990s by overbilling. The payment will be made over four years, Tenet said today.

Several of the issues resolved arose from qui tam lawsuits filed by whistleblowers. The False Claims Act allows whistleblowers to bring suits against companies who defraud the government and to share in the recovery.

The DOJ issued a press release on June 29, 2006 and Reuters and Bloomberg reported on the settlement

Wednesday, June 28, 2006

AT&T pays nearly $3 million in qui tam suit

AT&T has paid the United States $2,946,000 to resolve allegations that it defrauded federal agencies by knowingly charging them more than the actual costs and fees AT&T paid to local telephone companies for access to their phone lines.

AT&T provided telephone services to the government as part of a program administered by the General Services Administration that was designed to provide global telecommunications services to federal agencies.

The suit was the result of a whistleblower complaint filed under the qui tam provisions of the False Claims Act, a federal law that allows private individuals to sue on behalf of the United States.

Lawfuel reported on the settlement on June 27, 2006

Friday, June 16, 2006

St. Barnabas hospitals to pay $265 million to settle qui tam suit

Saint Barnabas Health Care System will pay $265 million to settle charges that it cheated Medicare out of more than half a billion dollars. The payment will resolve allegations that the hospitals inflated charges for Medicare patient care and received supplemental "outlier" payments to which they was not entitled.

Court papers indicate that numerous other unidentified hospitals are apparently facing similar accusations that they abused a Medicare provision that provides for supplemental payments for unusually expensive cases, referred to as "outliers."

The suit was the result of qui tam complaints filed by whistleblowers under the False Claims Act. and The Wall Street Journal (subscription required) reported on the settlement on June 16, 2006.

Tuesday, June 13, 2006

Atlanta hospital will pay $3 million to settle False Claims Act allegations

Piedmont Hospital, of Atlanta, Georgia, has agreed to pay more that $3 million to resolve allegations that the hospital submitted claims to federal health care programs for services that were not eligible for reimbursement. The suit was brought by a whistleblower, Patricia Quinnelly, who brought her charges under the False Claims Act. Ms. Quinnelly, a vascular technologist, will receive $354,390 as her "relator's share."

The U.S. Attorney's Office for the Northern District of Georgia issued a press release on the settlement on June 9, 2006.

Baxter International to settle Texas Medicaid fraud suit

Baxter International, a maker of blood-disease treatments, has agreed to pay $8.5 million to settle a suit alleging it falsely reported the prices of drugs to the Texas Medicaid system. The suit was brought against Baxter, as well as Abbott Laboratories and B. Braun Medical Inc., in 2004. The other defendants have not yet settled.

The suit alleged that the companies misreported prices of intravenous fluids and injectable medications, causing Texas Medicaid to reimburse pharmacies at above-market rates.

The Chicago Tribune ran the Bloomberg story on June 13, 2006.

Gabelli agrees to settle False Claims Act suit

Mario Gabelli, the money manager, has agreed to settle charges that he defrauded the federal government by using sham companies to bid for cellular phone licenses. The terms of the settlement will not be publicly disclosed until June 29th, when they will be filed with the court.

Gabelli bankrolled sham startup companies in order to bid on Federal Communications Commission licenses that were set aside for small businesses. The Wall Street Journal story speculated that the settlement will include a payment of more that $100 million to the federal government.

The relator who originally brought the suit under the qui tam provisions of the False Claims Act was Rufus Taylor III. Mr. Taylor was represented by the law firms of Phillips & Cohen and Williams & Connelly.

Bloomberg reported on the settlement on June 6, 2006. Additional information, with cites to a variety of news reports, is available at the Phillips & Cohen website.

Saturday, June 10, 2006

New Jersey school pays for school lunch fraud

A private school in Union City, New Jersey, has paid the federal government $469,000 to settle charges that it billed the National School Lunch Program for meals it never served. Mesivta Sanz, a nonprofit corporation that runs the school, allegedly submitted false information to the Dept. of Agriculture, claiming that meals were served on days on which no classes were in session.

Newsday ran a story on the settlement on June 9, 2006.

Monday, June 05, 2006

Farmers Exchange Bancorp. to settle loan fraud allegations

Farmers Exchange Bancorporation and Farmers Exchange Bank of Cherokee, Oklahoma, will pay the federal government over $2 million to settle allegations that they submitted false claims to the Farm Service Agency of the Department of Agriculture. The suit, originally brought by whistleblowers under the qui tam provisions of the False Claims Act, alleged that FEB improperly charged excessive fees and inflated interest rates on federally-guaranteed agricultural loans.

News of the settlement was reported by U.S. Newswire on May 31, 2006.