The largest monetary False Claims Act (“FCA”) case this week was by one of the nation’s leading provider of mobile equipment and services for eye surgery Sightpath. The company admitted no wrongdoing yet settled with the government for $12 million dollars after allegations surfaced that it violated the FCA and committed Medicare fraud. The complaint included allegations that Sightpath provided clinicians with luxury trips and fake consulting agreements as a way to bribe them to use Sightpath products and services in their eye practices for such services as cataract surgery covered by Medicare.
This was a violation of the Anti-Kickback Statute and the FCA. The scheme was revealed by a whistleblower who is protected by the FCA and who is now entitled to 20% of the amount recovered – out of $12 million dollar receovery that adds up to approximately $2.5 million dollars for the qui tam whistleblower. This unlawful promotion of the products and defrauding of a government program such as Medicare is absurd and rightfully caught. Enticing clinicians is not new but is becoming more and more frowned upon and captured by scrupulous employees and thereafter the government.
Under the FCA, the Judge is entitled to order the defendant to pay triple the actual damages that the jury finds. In addition, the FCA also permits statutory penalties from $5,500 to $11,000 for each false claim submitted by the defendant. As result, the whistleblower will receive approximately 15 to 30 percent of the total FCA recovery plus attorney’s fees.
As the main enforcement arm of the federal government, the Justice Department reviews all cases filed under the FCA. Then, once the whistleblower case is assessed, the government decides whether it will prosecute or allow the whistleblower to bring the complaint on the government’s behalf.
The FCA is used to stem out fraud related to billing, staffing, and kickbacks. Examples of these are when financial companies are supposed to abide by state and federal laws and chose to ignore them. They also bills for services that were not provided or the bill was submitted at an improperly higher rate of reimbursement for the services. In addition, financial companies are often fount to illegally bill the government for substandard services by fraudulently certifying otherwise. Alternatively, these companies may realize that they have credit from their services that they have to repay to the government, but the companies do not reimburse the government within the 60 day time frame. See these blogs for more examples of the FCA.
If you witness any potential false claims in California (i.e. requests for reimbursement to the government, not actually rendering work when reimbursement is received, or receiving and knowingly retaining an overpayment) by your company, or you are retaliated against for voicing your concern about potential wrongdoing, immediate action is vital. Contact the experienced employment law attorneys at Stephen Danz & Associates for a free consultation to discuss your circumstances and legal options.