Healthcare and Pharma Cases

Whistleblower and pediatrician, Dr. Jean Moore, will collect an $825,000 cash reward for filing a False Claims Act lawsuit alleging that her employer, Mercy Health Springfield Communities, supplied illicit financial incentives to referring physicians. Mercy Health Springfield has agreed to pay the U.S. government $5.5 million to settle the allegations of healthcare fraud.

Dr. Jean Moore Files Whistleblower Lawsuit Alleging Improper Physician Referral Bonuses

Mercy Health Springfield Communities, a partnership between Springfield Missouri Hospital and Mercy Clinic Springfield, provides health care services for southwestern Missouri residents. Dr. Jean Moore’s whistleblower claim alleged that Mercy Health submitted false claims to Medicare when they billed for services that included financial bonuses for physicians’ patient referrals....

The pharmacy arena provides a vast, alluring and easily manipulated cash source for fraudsters. According to the Centers for Disease Control and Prevention, national expenditures for prescription drugs in 2013 alone were approximately $270 million, 9.3% of the total US health expenditures. Current projections show total healthcare spending will top $3.2 trillion in 2015. From 2015 to 2021, pharmaceutical spending is projected to grow at an average rate of 5-7%.

On the front-line in medication distribution, pharmacists, pharmacy owners, technicians, managers, pharmaceutical sales representatives, compliance officers, nurses and physicians are in prime position to detect and uncover fraudulent activities. Illegal kickbacks, false billings and off-label marketing arrangements violate Federal and State False Claims Acts, the Anti-Kickback Statute, and other federal and state laws. In turn, the number of pharmacy and health care professionals initiating successful and lucrative whistleblower actions under the False Claims Act continues to climb.

The 2014 Fiscal Year Report of the Departments of Health and Human Services and Justice on the Health Care Fraud and Abuse Control Program (HCFAC FY2014) listed eight examples of successful pharmacy fraud cases initiated, prosecuted or settled during fiscal year 2014. Of the eight cases mentioned (only a handful of the total 2014 pharmacy fraud cases), the United States government reclaimed over $157.6 million. The 2013 fiscal year report (HCFAC FY2013) mentioned pharmacy fraud cases with recoveries totaling $86 million....

Nuvasive Inc. has agreed to pay $13.5 million to settle a False Claims Act (FCA) healthcare fraud lawsuit with the United States, the US Department of Justice announced Thursday. Whistleblower Kevin Ryan initiated the whistleblower lawsuit alleging NuVasive caused health care providers to submit false claims to Medicare and Medicaid for surgical methods not approved by the U.S. Food and Drug Administration (FDA).

The lawsuit further alleged NuVasive paid kickbacks to induce physicians to use the company’s products. Kevin Ryan was awarded a $2.2 million whistleblower cash reward for reporting the false claims and kickback allegations.

Sales Representative Alleges NuVasive Misrepresented Products and Provided Physician Kickbacks

Mr. Ryan, a former NuVasive sales representative, alleged that, from 2008 to 2013, the California-based medical device manufacturer marketed its CoRoent System approved for the surgical treatment of severe scoliosis and severe spondylolisthesis for uses unapproved by the FDA. This misrepresentation allegedly prompted a number of hospitals and physicians to submit ineligible claims for reimbursement to Medicare and other federal health care programs....

A podiatrist accompanied by nail salon workers offers free pedicures to seniors. Sounds like a great deal, right? But the foot doctor winds up billing Medicare for phantom foot surgeries.

An equipment supplier gives away free knee braces to seniors, but then bills Medicare for more expensive types.

These are just two examples of how fraud is driving up America’s healthcare costs, according to Jim Landers, a reporter for the Dallas Morning News. Such rampant abuse amounts to anywhere from a staggering $93 billion to $310 billion, or 3 to 10 percent of what the US spends on health care, he says.

No Cost to Patients?

Consumers are told by the charlatans that the goods and services they are getting will not cost them a thing. The reality is that they may not be paying anything at the point-of-purchase, but all the waste will result in increased Medicare premiums they have to shell out the following year. [break]...

Orbit Medical Inc. and its partial successor, Rehab Medical Inc., agreed to pay $7.5 million to settle a Medicare fraud lawsuit. Whistleblowers Dustin Clyde and Tyler Jackson alleged the power wheelchair suppliers submitted false claims to federal health care programs for wheelchairs and accessories. Clyde and Jackson will split a $1.5 million whistleblower award for bringing the allegations to light.

Clyde and Jackson Allege Orbit Forged Medical Records to Defraud Medicare

Tyler Jackson and Dustin Clyde, two former employees of Orbit Medical, filed allegations of healthcare fraud under the Federal False Claims Act. Orbit Medical and Rehab Medical are medical equipment suppliers based in Utah and Indiana. Dustin Clyde and Tyler Jackson alleged that Orbit sales representatives adjusted physician prescriptions to get Medicare to pay power wheelchair and accessory claims....

Century Ambulance and nine Jacksonville, Florida hospitals will pay $7.5 million to settle allegations of healthcare fraud. The settlement resolves claims that hospitals routinely ordered medically suspect ambulance transfers, defrauding Tricare, Medicaid, Medicare and the Federal Employees Health Benefits Program out of $5 million in unwarranted billings. Whistleblower Shawn Pelletier will receive over $1.2 million for bringing the False Claims Act lawsuit.

Century Ambulance Employee Shawn Pelletier Alleges Unnecessary Transport Billings

Initial complaints were raised by former Century Ambulance employee Shawn Pelletier who filed a lawsuit under the Federal False Claims Act and the Florida False Claims Act. Pelletier alleged that hospitals and Century Ambulance were defrauding federal healthcare programs by submitting unnecessary claims for ambulance services....

Five ambulance companies in Southern California have settled at $11.5 million to resolve yet another ambulance-related healthcare fraud whistle blower lawsuit. Whistleblower Kelvin Carlisle, owner of a competitor ambulance company, alleged the five fraudulently engaged in “swapping” services with nursing homes and hospitals for exclusive rights to transport Medicare patients. Kelvin Carlisle will receive a $1.7 million whistle blower reward for exposing the allegedly fraudulent scheme.

Kelvin Carlisle Alleges Competitor Ambulance Companies’ Kickback-Scheme

Kelvin Carlisle filed the whistleblower lawsuit alleging his company, Care Medical Transportation Inc., could not compete with rival companies who were offering illegal discounts. He accused competitors of offering 50 to 100 percent discounts on non-emergency patient transport to nursing homes and hospitals. In return, the nursing homes and hospitals promised to use only those ambulance companies’ services for the lucrative Medicare transports....

Citizens Medical Center, a county-run hospital located in Victoria, Texas, agreed to settle with the United States government to the tune of $21,750,000 in a False Claims Act whistleblower case. According to the US Justice Department, this settlement will resolve claims that the Citizens Medical Center allegedly engaged in inappropriate financial transactions with referring doctors.

Department of Justice Monitoring Health Care Providers on Physician Referrals

“The Department of Justice has longstanding concerns about improper financial relationships between health care providers and their referral sources, because those relationships can alter a physician’s judgment about the patient’s true health care needs and drive up health care costs for everybody,” stated the Principal Deputy Assistant Attorney General Benjamin C. Mizer from the US Justice Department’s Civil Division. “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make healthcare more affordable.”...

The Department of Justice isn’t talking, nor is PharMerica, but at least one report claims the embattled institutional pharmacy operator is nearing settlement with the DOJ on two lingering False Claims Act cases.

PharMerica Pharmacist’s Lawsuit Filed in 2009

Louisville, Kentucky-based PharMerica has been embroiled in one whistleblower lawsuit under the U.S. False Claims Act since 2009 filed by Jennifer Denk (later Jennifer Bluth), a former employee pharmacist who blew the whistle when she allegedly discovered that Schedule II narcotics were being dispensed under her license without physician approved prescriptions and a host of other allegations of massive healthcare fraud against the government in billing Medicare....

A U.S. False Claims Act lawsuit alleging Adventist Health System Sunbelt Healthcare Corporation failed to provide oncologist supervision to Florida Medicare and TRICARE patients receiving radiation oncology services has been settled for $5.4 million according the Department of Justice.

Oncology Dr. Michael Montejo Exposed Alleged Adventist Cutting Corners

The settlement is the culmination of a False Claims Act whistleblower lawsuit filed by radiation oncologist, Dr. Michael Montejo in 2010. The “Qui Tam” filing, which allows a private citizen to file suit on behalf of the government, claimed that throughout the period 2010 to 2013 Adventist Health System failed to provide an oncologist or similarly qualified professional to supervise patients served by the Department of Defense’s healthcare system TRICARE and Medicare patients receiving radiation therapy....